Floods: Foreign investment in Thailand | Bangkok Post: learning

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Before the floods Thailand regained its position among the top 20 foreign investment destinations. Dealing with investor flood concerns, now key to the future.

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BY INVITATION: Thailand FDI: Will it stay afloat by Soon Ghee Chua & Chatinun Na Chiangmai

Thailand regained its position among the top 20 global destinations for foreign direct investment in 2011, according to the A.T. Kearney Foreign Direct Investment Index, a regular measure of senior executive sentiment at the world's largest companies. 

However, there is a high likelihood that Thailand's attraction to foreign investors will slip going forward, due to the impact of the Thai floods on its manufacturing base, unless the country takes concrete steps to address investor concerns.

Conducted regularly over the last 13 years by global management consulting firm A.T. Kearney, the survey this year found 55% of corporate investors saying FDI budget had returned to pre-crisis levels. But more than one-fifth said they didn't expect their FDI to return to pre-crisis levels until 2014 or later.

In addition, it is expected that the ongoing European debt crisis will have an impact on global investor confidence. China remains the top-ranked destination by foreign investors, a title it has held since 2002, followed by India and Brazil. 

The United States fell to fourth place from second, with its debt gridlock weighing heavily on investor sentiment.

Three countries from Southeast Asia - Singapore, Malaysia and Indonesia - are ranked in the top 10.

Thailand returns to the index this year in 16th place, after being out of the top 20 ranks since 2005 when it was in 20th place. This demonstrates Thailand's growth as a production base and a gateway for exporting industrial products to the booming Southeast Asian economies.

Foreign direct investment inflow expanded 17% to 180 billion baht, a vote of confidence despite political chaos resulting in battles in the streets of Bangkok and an iconic shopping mall being burned to the ground.

Investor perception has improved, especially among Europeans and Americans. Significant improvements are in heavy and light industry, where investor confidence rose more than 80% to the 9th and 11th spots, respectively, in the FDI Index by Industry. Financial services also made it into the top 10 destinations for investors.

Political disorder aside, industry in Thailand has enjoyed legal and regulatory predictability in its operating environment, in contrast with other countries in Asia. It would appear that investors are not worried about political instability in Thailand as long as the overall infrastructure support and investment climate is sound.

However, the flooding in Thailand is likely to have some impact on FDI.

According to the World Bank, estimated damage to Thailand's manufacturing base is about 400 billion baht in terms of assets destroyed, and a further 700 billion baht in production loss.

The impact has been directly felt by Western Digital and other hard drive makers, which have seen 60% of their factories inundated, as well as automotive players such as Toyota and Honda, whose inventory has been hit by damage to suppliers' and their own factories

Other global industries and players not directly present in Thailand have been affected. For example, Intel said it would miss its revenue estimate in the coming quarter by US$1 billion because PC and server makers have put off orders for chips in anticipation of a hard drive shortage.

While short-term FDI in Thailand may be aided by the rebuilding effort at damaged plants, investor confidence will probably suffer in the medium to long term. Investors are likely to revisit their manufacturing footprint and take into account the risk of floods and other natural disasters in Thailand

As a result, existing operations in Thailand may be scaled back or eliminated altogether and new investments curtailed, especially if there are other attractive destinations in the region such as Malaysia, Indonesia and Vietnam.

In order to regain investor confidence, Thailand will need to [do several things, read about them in the rest of the article: here]

(Source: Bangkok Post, BY INVITATION, Thailand FDI: Will it stay afloat, 26/12/2011, Soon Ghee Chua & Chatinun Na Chiangmai, link) 

Foreign Direct Investment (FDI) Vocabulary

Foreign Direct Investment (FDI) - investments by companies of one country in another country by buying property, building factories, buying businesses, etc (See Wikipedia)
investment - taking your money and putting it into projects to make a profit or earn interest (buying stock shares, bonds, real estate)
Thailand FDI - foreign companies investing in Thailand

afloat - floating on water ลอยอยู่ในน้ำ
stay afloat - not sink, not fail, continue in existence
Will it stay afloat?  - will it fail or continue in existence? 

global - all over the world, including the whole world, throughout the world ทั่วโลก
destination - the place where someone or something is going ปลายทาง จุดหมายปลายทาง
global destinations for foreign direct investment
Thailand regained its position among the top 20 global destinations for foreign direct investment in 2011

the A.T. Kearney Foreign Direct Investment Index, a regular measure of senior executive sentiment at the world's largest companies  

likelihood - the chance that something will happen ความเป็นไปได้
attraction to foreign investors will slip going forward - will become less attractive to investors

there is a high likelihood that Thailand's attraction to foreign investors will slip going forward

impact - an effect or influence ผลกระทบ
the impact of the Thai floods on its manufacturing base

concrete - based on facts, not on ideas or guesses
take concrete steps - do things to achieve a goal that can be seen (not just talk, not just plans)

address - to try to deal with a problem or question จัดการกับปัญหา
investor - a person or organisation that puts money into a company in exchange for a future profit นักลงทุน
concerns - worries ความกังวล

address investor concerns - take action on the things that investors say they are nervous about
the country takes concrete steps to address investor concerns.

consulting - giving expert advice on a subject (for example: how to run a business or how to build a building)
firm - a business or company บริษัม
management consulting - experts in how to run a business who go into a business, do a study and then give advice (See Wikipedia)

survey - gathering information about what people think about different subjects (public opionion) by asking large numbers of people questions and counting their answers, and then using statistics, graphs, and tables to present results (See Wikipedia) การสำรวจความเห็น
conduct a survey - do a survey, carry out a survey

a survey conducted regularly over the last 13 years by global management consulting firm A.T. Kearney

budget - the amounts of money that an organisation has available to spend on different things during a period งบประมาณ (See Wikipedia)
FDI budget - the amount in  an organization to be spent on overseas business operations such as factories

crisis - an urgent, difficult or dangerous situation วิกฤตการณ์ วิกฤต
pre-crisis levels - the amount before the crisis

this year found 55% of corporate investors saying FDI budget had returned to pre-crisis levels

expected - believe will happen คาดว่า (จะเกิดขึ้น)
ongoing - happening at the present moment; continuing ไม่หยุดยั้ง, ต่อเนื่อง
debt - an amount of money that you owe หนี้
confidence - the quality of being certain; feeling sure about something; trusting and believing in something ความมั่นใจ, ความเชื่อมั่น

it is expected that the ongoing European debt crisis will have an impact on global investor confidence.

title - the position of a winner in a sports competition ตำแหน่งแชมป์

top-ranked - among the best
China remains the top-ranked destination by foreign investors, a title it has held since 2002, followed by India and Brazil.

ranked in the top 10   - among the 10 best
Three countries from Southeast Asia - Singapore, Malaysia and Indonesia - are ranked in the top 10.

gridlock - a situation in which you cannot move forward (example: heavy traffic at the intersection caused gridlock and cars were unable to go anywhere)
debt gridlock - a situation in which the interest rates or debt is so high so debt cannot be paid off

sentiment - feelings; an attitude or belief that people have based on their thoughts and feelings อารมณ์ทางความคิด; a thought, opinion or idea based on a feeling about a situation, or a way of thinking about something กระแส, แนวความคิด, ความคิดเห็น
investor sentiment - the way that investors feel about some situation that they might invest in

debt gridlock weighing heavily on investor sentiment

the United States fell to fourth place from second, with its debt gridlock weighing heavily on investor sentiment

Thailand's growth as a production base and a gateway for exporting industrial products to the booming Southeast Asian economies.

chaos - a situation in which everything is confused and in a mess ความยุ่งเหยิง, ความสับสน การจราจล a very confused situation ความโกลาหล
perception - the way people think about something, the impression that people have of something; the way you see and think about something การรับรู้

vote of confidence - do something like choose a person for some project or work (that shows that you are "confident" in them and believe in them)
political chaos - political disorder

iconic - an important image with a meaning; the symbol of something
iconic shopping mall being burned to the ground

foreign direct investment inflow expanded 17% to 180 billion baht, a vote of confidence despite political chaos resulting in battles in the streets of Bangkok and an iconic shopping mall being burned to the ground

investor perception - what investors see and believe the situation to be
heavy and light industry
financial services

disorder - a situation in which people behave in a noisy or violent way in public, often as a protest against something ความวุ่นวาย
X aside, Y - Y is generally true, but X is an exception that does not follow the rule
contrast - a difference between two things when you compare them; a noticeable difference ความแตกต่าง
enjoyed legal and regulatory predictability in its operating environment
X in contrast with Y - X very different from Y 

political disorder aside, industry in Thailand has enjoyed legal and regulatory predictability in its operating environment, in contrast with other countries in Asia

instability - unstable, can change suddenly without notice, this makes it difficult to work with
X as long as Y - X is true if Y is true, for as long as Y is true

infrastructure - the high-cost facilities that everyone in the economy shares (water, roads, electricity, trains) สาธารณูปโภค
support - help สนับสนุน
infrastructure support - help from infrastructure that makes business operations easy

sound - in good condition; healthy แข็งแรง
not worried about political instability in Thailand as long as the overall infrastructure support and investment climate is sound.

Thailand's manufacturing base - the factories and companies doing manufacturing in Thailand (producing goods in factories such as cars, electronics, etc)
in terms of Y - as measured by Y
assets - a thing of value that a person or a company owns, for example: stocks, bonds, real estate, loans to others, or money ทรัพย์สิน

estimated damage to Thailand's manufacturing base is about 400 billion baht in terms of assets destroyed, and a further 700 billion baht in production loss

inundated - flooded ถูกน้ำท่วม, จมลงใต้น้ำ
have seen 60% of their factories inundated

players - participants in an industry, companies and individuals who compete in a market; important companies, people, or countries in an industry ผู้ค้าคนสำคัญ หรือผู้ค้ารายใหญ่
inventory - goods that a company has bought and stores for future use or sale;  the products kept in a shop, warehouse, etc., in this case, unsold cars สินค้าที่จัดเก็บในสต๊อก (See Wikipedia)

automotive players such as Toyota and Honda, whose inventory has been hit by damage to suppliers' and their own factories

present - being at a place, existing at a place (here: doing business, running a business at a place)
global industries and players not directly present in Thailand have been affected.

revenue - income from taxes or business activities รายได้
estimate - a guess; to say what you think an amount or value is or will be, either by using available information or by guessing คาดคะเน  โดยประมาณ

revenue estimate - the company said it would earn this amount (during the next year or quarter) 
miss revenue estimate - the company failed to earn this amount
miss target - fail to reach or achieve target or goal

miss its revenue estimate in the coming quarter

X in anticipation of Y - doing X because you think that Y will happen

shortage - when there is not enough of something การขาดแคลน
a hard drive shortage
server makers have put off orders for chips in anticipation of a hard drive shortage.

Intel said it would miss its revenue estimate in the coming quarter by US$1 billion because PC and server makers have put off orders for chips in anticipation of a hard drive shortage.

aided - helped ช่วยเหลือ
effort - an attempt to do something ความพยายาม
plants - factories
suffer - to experience physical or mental pain

while short-term FDI in Thailand may be aided by the rebuilding effort at damaged plants, investor confidence will probably suffer in the medium to long term.

footprint - the impact or trace of something that remains after an event happens 
manufacturing footprint
revisit their manufacturing footprint

X takes into account Y - statement or action X knows about and uses information Y

risk - danger, how likely or possible it is for a bad event that causes harm and damage ความเสี่ยง
risk of floods

natural - found in nature (not made in a factory by humans) ตามธรรมชาติ
natural disasters - bad events like earthquakes, floods, etc that damage things and hurt people

natural disasters
investors are likely to revisit their manufacturing footprint and take into account the risk of floods and other natural disasters in Thailand

scaled back - reducing the amount of an activity that is done
eliminated altogether - ended, stopped, no longer exists 
curtail - stop, end
new investments curtailed - not make any new investments in the future
as a result, existing operations in Thailand may be scaled back or eliminated altogether and new investments curtailed

attractive - 1. worth having or doing; 2. pleasant to look at น่าสนใจ
attractive destinations - a nice place to go to; a place worth going to
other attractive destinations in the region such as Malaysia, Indonesia and Vietnam.

regain - to get back something that was lost or taken away ได้กลับมา ได้กลับมาใหม่ บังคับรถได้เหมือนเดิม
regain investor confidence

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