Posted on 13 Dec 2011
Electrical and electronics industries are expected to lose 240 billion baht from the floods.
Most of their losses will be reported in the fourth quarter of this year, said Supachai Suthipongchai, chairman of the electrical and electronics club under the Federation of Thai Industries.
"It's the biggest loss for the sector since the 1997 crisis," he said.
Mr Supachai, also president of Sharp Thai Co, expects all flood victims in this sector will resume operations by the second half of next year.
Executives of many electronic firms located in Pathum Thani and Ayutthaya have discussed with their parent firms in Japan whether they would move their production bases from Thailand or re-invest here.
"It's not difficult for electronics firms to move their production because their factories don't use large machines," he said.
Moreover, many manufacturers set up their production in Pathum Thani and Ayutthaya provinces because it is near Don Mueang Airport of which reopening date has not been set.
"International flights were moved to Suvarnabhumi Airport and Don Mueang could take months to repair. This will be a factor in whether companies choose to stay or move," said Mr Supachai.
A few spare parts manufacturers have already confirmed they will move their production bases from Thailand.
Last week, Sanyo Semiconductor (Thailand) announced it will leave as well, affecting over 2,000 workers.
The confidence of foreign investors in Thailand, particularly the Japanese, has declined sharply during the floods. They felt the impact has been worse than need be because the government lacked efficient flood crisis management.
Another factor may be the Thai government's plan to increase the daily minimum wage to 300 baht in April.
"Foreign investors expect natural disasters should not be a major obstacle for them if the government plans properly to deal with disasters. They feel the government had information about water levels but did nothing with it," he said.
"And by choosing to continue with the minimum wage hike at a time when companies are hurting, some foreign investors feel Pheu Thai governs only based on popular vote and does not listen to other opinions."
Foreign investors feel the most important objective for the government is to find a clue on how to manage water efficiently over the long term, he added.
Mr Supachai also urged the government to revise regulations on foreign workers. He wants Thai factories to be able to hire more foreign unskilled workers, as prior to the flood, there was a shortage of 200,000-300,000 labourers for all industries.
He also wants the government to underline a clear focus for the country on agriculture or industries.
"The government didn't release water from dams because it wanted farmers to have more time for cultivation, but it didn't consider the damage to industries if too much water accumulated," he added.
Toshiba and Sony's electrical appliance factories were inundated, as well as Hitachi's plant for spare compressor parts.
Electrical appliance prices should increase next year as the minimum wage rises.
