Joint panel aims to repair FTI rift

The two feuding factions of the Federation of Thai Industries yesterday agreed to set up a joint committee with five members each to resolve their conflicts.

Tanit Sorat, secretary-general of the FTI, said after a meeting of 257 members that the first thing for the joint panel to consider was Payungsak Chartsutipol's claim still to be the FTI chairman, and this confusion would be cleared up in 10 days.

Tanit said his side did not acknowledge the other's agenda, including the key relief measures for the impact of the higher minimum wage on small and medium-sized enterprises, on grounds that they were not informed of the agenda before the meeting. They then left the meeting room. This blocked the other camp from forming a quorum, which requires the presence of half of the 348 members.

Payungsak told a news conference that the joint committee was a good starting point.

"The FTI belongs to all members, and I myself am willing to talk with both sides. I will not make any accusations or attack anybody," he said.

The conditions raised at the meeting are still legitimate despite the walkout of the Tanit faction, he said. Those conditions include any actions raised by the FTI to push the government to help SMEs and relief measures for the new minimum wage's impact on them.

The FTI will lead SMEs to discuss with the government their request for 10 relief measures, he added.

Tanit told a seminar on "SMEs and Adjustment amid Changes" that the FTI and SMEs would meet with Deputy Prime Minister Kittiratt Na-Ranong again after previous meetings did not yield results.

Based on a survey this month by the FTI on relief measures for SMEs, the proposals include the setting up of a compensation fund for the differential between the old minimum wages and the new nationwide one of Bt300 a day, guidelines for such compensation, and a reduction of both employers' and employees' contributions to provident funds from 5 per cent to 3 per cent.

Relaxation sought

Other demands are a relaxation of contributions to the workmen's compensation fund to 0.01 per cent for three years, reduction in withholding tax for contracting and subcontracting from 3 per cent to 0.01 per cent, practical liquidity measures for access to funding sources, subsidies for other expenses, including tap water, electricity and diesel, and technology support and production efficiency improvement through low-interest credit for new machine purchases.

The development of operators' competitiveness through technology to lower costs and the launch of a state centre for product distribution in the country and abroad were also included.

Weerayut Sukwattako from Confederate International Co said operators had seen their costs rise by about 10 per cent after the minimum daily wage was raised to Bt300, while product prices had risen by only 2 per cent, leading to lay-offs. The company has cut its workforce from 260 to 140.

Tanit said the strengthening of the baht would likely be temporary, but the government should assist small and medium-sized exporters, which have been hit by the baht's appreciation.

The FTI will propose a package of SME measures to the Bank of Thailand, including the acceleration of the private sector's and state enterprises' debt repayment, extension of the holding period for foreign-currency deposits and acceleration of machinery imports for infrastructure investment.

Tanit also asked the central bank to stabilise the baht and keep the currency moving in parallel with its regional peers.