New central company proposed for logistics

The Commerce Ministry plans to set up a central company in cooperation with private logistics operators to link logistics systems and help cut costs.

At present, logistics costs amount to Bt440 billion, comprising up to 19 per cent of the country's gross domestic product, which is too high.

The project to set up a central company for logistics is aimed at reducing dependence on fuel and developing logistics efficiency amid soaring oil prices.

The move came after the private sector called for the government to accelerate passing a Logistics Act to support the growth of the sector. However, the act needs time for consideration, therefore the government and private companies will set up a central organisation to develop the logistics system.

"There is an urgent agenda to develop logistics amid higher costs

of fuel. The ministry will help the private sector create a network to reduce logistics costs in order to increase the efficiency of enterprises," said Deputy Commerce Minister Viroon Tejapaiboon.

The central logistics firm will be formed in the next three months, with cooperation from Federation of Thai Industries, Thai Logistics Service Providers Federation, Air Logistics Service Provider Federa-tion, and Trucker Enterprises Federation.

The new firm is expected to create a network for shippers, truckers and logistics providers to cooperate in delivering goods on a round-trip basis. Currently, more than 40 per cent of domestic transportation is a one-way trip, which creates huge losses.

Moreover, the ministry will formulate regulations as part of the Logistics Act to further develop Thai enterprises and protect local logistics services.

Federation of Thai Industries deputy secretary-general Thanit Sorat said the rising cost of fuel was a major burden for all businesses.