Labour woes, slow insurance pay-outs hit Japan invstors - The Nation

Home ? business ? Labour woes, slow insurance pay-outs hit Japan invstors

PETCHANET PRATRUANGKRAI
THE NATION March 30, 2012 1:00 am

"The flooding drove employees away from many firms that suspended operations for too long. Those firms now need thousands of new employees, but workers are hard to find," a Japanese businessman said at a special luncheon of the Thai-Japanese Association yesterday.

Japanese and Thai businesspeople said they had been unable to recruit workers even though they implemented the new Bt300 minimum daily wage ahead of schedule. The government should help solve the labour problem, otherwise many companies will further delay reopening and many industries will run out of parts and materials, they said.

The source also said his firm had not yet received a cheque for its insurance claims and it needed the funds to continue operating. He asked for the government's assistance to urge insurers to pay the claims soon.

Industry Minister Pongsvas Svasti said the slow claims payments were due to a lot of paperwork by insurance firms.

More than Bt100 billion is sitting in banks waiting for claims payment. However, the 838 companies in industrial estates were not alone in putting in claims. So have tens of thousands of small and medium-sized enterprises that were affected by flooding. Companies should soon start gradually receiving payments from the insurers, he said.

Pongsvas told the Japanese community that the government's measures would be able to prevent at least 50 per cent of floods this year. He assured Japanese investors that the government would continue to protect industrial estates and grant more privileges to promote investment in the country.

Kobkarn Wattanavrangkul, president of the Thai-Japanese Association, said many flood-affected companies could not resume operations as quickly as they had expected as they were facing human-resource and supply-chain problems and were still waiting for insurance payments. Also, many trading partners have forced companies in Thailand to take out more insurance to prevent business disruption this year.

Kobkarn, who is also the chairwoman of Toshiba Thailand, said many firms in flood-hit areas were now struggling to restart their plants because of many obstacles.

"The lack of workers is one of the most serious problems of enterprises in the industrial estates," she said.

Minoru Sato, president and chief executive officer of Yusen Logistic (Thailand), part of NYK Group, said he still had doubts about the country's flood-prevention measures, as their implementation and time frame were still unclear, while natural disasters are expected.

"A repeat of the floods would seriously damage the Thai economy and the country would face difficulty restoring confidence. Investors would cut back and stop investing in Thailand." Many companies are now concerned about the shortage of manpower in Thailand, he said.

Setsuo Iuchi, president of the Japan External Trade Organisation, said Japanese investors had more confidence in the government's flood-prevention measures, but they wanted to see clearer implementation plans and time frames.

Many Japanese companies still want to invest in Thailand despite the wage hike being imposed this weekend. The government should help promote investment, address the labour shortage and increase worker efficiency after the wage increase, he said.

Minoru Furusawa, vice president of the Japanese Chamber of Commerce in Bangkok, said Japanese companies still had confidence and were interested in investing more in Thailand after the government granted more privileges for projects in flood-hit industrial estates.

Pramon Sutivong, chairman of Toyota Motor (Thailand), said more investors would diversify to other Asean countries out of concern for floods and higher production costs in Thailand.

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