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Published on January 17, 2008

However, they have joined high-end retailers to urge the rapid formation of a new government as the final mechanism needed to drive the overall economy, consumer confidence and foreign investment.

Well-known Italian fashion brand Valentino has announced it will form its first joint venture in the Asia-Pacific with a Thai company named Angy, owned by Bangkok businessman Vachara Phanchet.

Saihathai Sangsingkaew, Angy's brand manager, said the joint venture would be formed next month and called Valentino Fashion Group (Thailand). The Italian firm opened its first retail outlet in Bangkok in the Siam Paragon shopping complex last May.

"We expect a better economic situation once a new government is formed and the overall political issues have been resolved," Saihathai said.

Chanel (Thailand) managing director Guillaume Sauzin said his company had never worried about Thailand's economic situation and was quite confident about the future.

"There is incredible energy and dynamism in the Thai economy, and despite the political turmoil, the people will manage to find a solution," Sauzin said.

In addition to its first boutique store in Bangkok, which opened in The Emporium shopping centre in 1997, Chanel has opened two new boutique stores in the past 18 months: one in Siam Paragon and another at Suvarnabhumi Airport.

"Despite the economic difficulties, we are doing extraordinarily well and have seen excellent opportunities for investments in Thailand. We'll continue growing at double-digit figures every year," Sauzin said.

He said his only major concern for Bangkok was that it should adopt a "real" duty-free price structure for imported fashion brands, in order to attract both foreign tourists and Thai shoppers.

The current customs-duty system means fashion products selling in Bangkok are 10-12-per-cent more expensive than in duty-free markets in Hong Kong and Singapore.

Thai Samsung Electronics marketing manager Manatase Annawat said his company was optimistic about better economic conditions this year.

"We'd like to see the new government set up as soon as possible, so that the political situation will be clear and foreign investors encouraged to invest in the country," he said.

Manatase said despite Thailand's economic and political difficulties, the mobile-phone market grew 12 per cent in sales volume last year. However, in terms of sales value, growth was flat.

Samsung posted 34-per-cent growth in mobile-phone sales volume, although the figure was only 20 per cent in value terms.

"We expect the mobile-phone market to continue to grow this year, driven by new touch-screen products and low-priced items. The market should grow 10 per cent in terms of quantity and 5 per cent in sales value," he said.

The Emporium's senior managing director, Kriengsak Tantiphipop, said his company was quite confident Thailand's economy would bottom out this year.

"We've seen better signs of the Thai economy picking up this year. Financial institutes are giving Thailand better ratings; foreign investors are taking a more favourable view," Kriengsak said. "We - the private sector - would like the new government to be set up as quickly as possible, because that is the last mechanism needed to make everything move."

Kriengsak said Thailand's retail industry was expected to grow 10-15 per cent this year, up from growth of about 5 per cent last year during last year's economic slowdown.

Kwanchai Rungfapaisarn

The Nation