This was the conclusion of participants and speakers at the Bank of Thailand's annual conference yesterday.

Kiatipong Ariyapruchya, Chatsurang Karnchanasai and Cheerapan O-lanthanasate, from the central bank's Monetary Policy Group, presented a paper entitled "Strengthening the competitiveness of Thai Firms: What needs to be done?", in which they said the government should create a better local environment for competition to help businesses survive in this era of globalisation.

They said a major step in this direction would be to boost "total firm productivity", which reflects production efficiency at private firms.

"The government should create an environment that forces businesses to improve their competitiveness, then winners and losers will appear. The private sector should be well prepared if it is to integrate with the rest of the world," they said.

They trio also said the government should ensure that the Trade Competition Committee (TCC), which supervises fairness in trade activities, is transparent, while all relevant laws were maintained to ensure fairness for all companies.

Another speaker, Nipon Poapongsakorn, the dean of Thammasat University's Faculty of Economics, however, said that it is difficult for the TCC to be free from political interference.

He said that in practice, the commerce minister is automatically appointed chairman of the committee, while the permanent secretary of the Commerce Ministry is also a member.

He said the current anti-monopoly laws were not practical for the Thai market.

Meanwhile, presenting a paper entitled, "Thailand in the new Asian economy: The current state and way forward", Pichit Patrawimolpon and Runchana Pongsaparn, from the central bank's Economic Research Department, said Thailand's sectors with traditional strengths such as agricultural were still competitive and contributed significantly to the country's trade balance.

There are also contributions from the auto and electronics sectors to the trade balance, they said.

However, fuel, metallic and chemical products are the top three import items in terms of value, which is a situation that should be improved upon, they said.

The import value of these was US$32.4 billion (Bt1.22 trillion) in 2005, higher than the top 10 export items' combined value of $25.6 billion in the same year.

The 10 products are ceramics and glassware, fishery, footwear, furniture, wood and paper products, plastic products, agriculture, vehicles, textiles and clothing, rubber products, and processed food and tobacco.

From their findings, the department also found that foreign direct investment-based exports from Thailand helped maintain the Kingdom's global market share despite the economic rise of China and India.

Anoma Srisukkasem,

Jiwamol Kanoksilp

The Nation