aec preparation for thai businesses
TRANSCRIPT
1© SCG 2012
AEC preparation for Thai Businesses
“โคง้สดุทา้ยสู่ AEC… อีสานกบั CLMV จะปรับตวัอย่างไร”
โรงแรมพูลแมน ขอนแก่น ราชา ออคิด จงัหวดัขอนแก่น
8 กนัยายน 2557 14:15 – 16:15
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Kulachet DharachandraCorporate Planning Director - SCG
2© SCG 2012
Agenda
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Thailand and CLMV –Opportunities
SCG Growth Stories
Challenges and how we managed…
3© SCG 2012
Agenda
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Thailand and CLMV –Opportunities
SCG Growth Stories
Challenges and how we managed…
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Opportunities in ASEAN and CLMV + Thailand
ASEAN CLMV Thailand ESAN
���� Population > 600M > 170M > 68M > 19M
���� GDP [Bn USD] 2,300 ∼ 220 ∼ 370 40
���� GDP [USD] per capita 3,750 1,270 5,400 2,150
���� GDP growth 5-6% 6-7% 4-5% N/A
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Thailand will be even more connected to CLMV than before under new infrastructure investment plan
Cambodia- GDP growth (‘14-’18): 7.4%- Population: 15.1 million- Cross border trade:
46,309MB (+19.46%)
Vietnam- GDP growth (‘14-’18): 6.4%- Population: 89.7 million- Cross border trade:
18,131MB (+206.42%)
Laos- GDP growth: 7.9%*- Population: 6.8 million- Cross border trade:
65,205MB (+9.47%)
* Figure of 2013, Trade figure is for Jan-May 2014
Myanmar- GDP growth (‘14-’18): 7.0%- Population: 61.9 million- Cross border trade:
81,544MB (+2.63%)
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6© SCG 2012
Agenda
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Thailand and CLMV –Opportunities
SCG Growth Stories
Challenges and how we managed…
SCG Competitive Landscape
Territory
Product
Focus
Domestic
Commodity-based
Cost Leadership
The Old Playing Field
ASEAN
HVA Products & Services
Innovation & Technology, Brand, Green Initiatives
The New Playing Field
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SCG’s Investment Practice
Strategic fit• Domestic – HVA and New
opportunities in new business• Overseas – expanding our
core businesses to ASEAN
Our Competitiveness• Financials, System,
Operations, Technology• Expertise, Manpower
Market attractiveness• Growth trend• Consumption per capita• Consumer behavior
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2
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SCG Investment CriteriaAlign with our vision
SCG Investment Steps
- Packaging Paper- Chemicals
Total Assets $1,111 Mil (36,050 MB)Total Assets $21 Mil (697 MB)
Total Assets $228 Mil (7,386 MB)- Paper
- Paper & Packaging
- Chemicals
- Cement-Building Materials
- Cement-Building Materials
- Cement-Building Materials
- Cement-Building Materials
- Cement-Building Materials- Cement-Building Materials
- Packaging Paper
Malaysia & Singapore (1996) Indonesia (1994)
Philippines (1994)
Vietnam (1992)
Laos & Cambodia (1992)
Myanmar (1994)
Total Assets $227 Mil (7,366 MB)
Total Assets $176 Mil (5,713 MB)Total Assets $604 Mil (19,599 MB)
Current update of SCG Presence in ASEANASEAN assets = $2.4 billion (76,811 MB)
(17% of total assets)
Note: As of June 14
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10%
12%
14%
16%
18%
20%
22%
24%
26%
28%
0
10,000
20,000
30,000
40,000
50,000
60,000
70,000
80,000
90,000
ASEAN Operation
Export to ASEAN
% ASEAN on Sales
SCG ASEAN Revenue and Vietnam operation
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0
5,000
10,000
15,000
20,000
25,000
2010 2011 2012 2013
VN Operation Export to VN
Sales (MB) % on SalesRevenue from VietnamSCG ASEAN Revenue
CAGR16%
CAGR15%
SCG presence more than 20 years in Vietnam since 19 92
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2013
Vina Kraft Paper
1992
1996
2004
SCG Trading
Viet-Thai Plastchem
CHEMTECH
2007
2010
2011
TPC VINA
SCG CONCRETE
New Asia
MINH THAI WINDSOR
1998
2006
2008
CPAC Monier
AP PackagingAlcamaxPackamax
2012Cement Buu Long
Tien Phong PlasticBinh Minh Plastics
Prime Group
SCG International Staff: 305 persons
SCG Staff in Overseas Operations: 14,942 persons
As of July 2014* Consolidated basis
Indonesia 6,681Vietnam 6,373
Philippines 1,086
Cambodia 400Myanmar 129Others 273
SCG Manpower: 50,345 personsOverseas staff: 30% of total staff
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Many dimensions of Vietnam are similar to Thailand
Source: EIU, Deutsche Bank analysis
Vietnam Thailand
KeyHighlight
“3 distinctive regions (North, Central,
South) in culture and dialect with challenging logistic issues
“Familiar market moving toward sophisticated
customer needs”
GDP Growth(2014-2018)
6.4% 4.5%
GDP per capita [USD]
(2012)
1,600 5,400
Population [Million]
90 68
GDP mix
Private consumption
51%
Govt. 10%
Investment22%
Export , 74%
Import, 59%
Private consumption
65%
Govt. 6%
Investment27%Export ,
89%
Import, 88%
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14© SCG 2012
Agenda
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Thailand and CLMV –Opportunities
SCG Growth Stories
Challenges and how we managed…
Cross-cultural diversity
Local Staff Engagement
Local Community Concerns
Country Risk
Law and Regulation
Language
FX/Currency
Challenges from Regional Expansion
ASEAN growth are just the first step...
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Challenges from Vietnam expansion
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Macroeconomics- Currency and foreign exchange
- VND devaluation in November 2011 and June 2013- High inflation (H1/2014, 4.98%)- High interest rate (H1/2014, 9.0%) and developing banking system
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Politics- South Sea dispute with China2
Law and Regulation - Periodical change of the regulation e.g. labor law- Local government rule under the master plan of central government
3Environmental and social issues
- Local community concern 4Language
- Vietnamese translators maybe required5
Engage local law firm Engage local community
IC approval by govt- Econ/Industrial zone
Suggested practice
17© SCG 2012 17
CLMV’s economy is growing .
Population is becoming more affluent. .
Regional Game Plan &
CLMV SPIRIT are vital
Thank you
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