Unrest hits transport, cargo firms
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Unrest hits transport, cargo firms

SMEs mull layoffs as border trade falls

The ongoing political conflict has adversely affected the land transport business and is expected to limit its growth to only 3% this year, the Land Transport Federation of Thailand (LTFT) says.

LTFT adviser Thongyu Khongkan said land transport and logistics companies, particularly small and medium enterprises (SMEs) which account for 70% of the country's 340,000 operators, are now having a hard time doing business.

Many are expected to be forced to halt operations and lay off cargo handlers from next month, he said.

"Prospects for the transport and logistics businesses this year are far worse than earlier expected," Mr Thongyu said. "Although the political problems could end quickly, the growth of the transport business this year is expected to be no more than 3%."

According to Mr Thongyu, the new expected growth rate is sharply lower than the 10% expansion earlier predicted based on the previous forecast that the economy could grow by 4-4.5% this year.

He said the transport business in the first quarter registered zero growth as the export sector has not yet recovered and was expected to miss its projected growth of 5% this year, he said.

Mr Thongyu also said purchasing power is expected to fall sharply after the Songkran festival due to faltering consumer confidence.

The passenger transportation business will also suffer due to an expected drop in the number of tourists during the rainy season from next month to September, he said.

Trade has also been impeded by limited numbers of distribution depots and checkpoints along the border, which has subsequently hurt border transport, he said.

Mr Thongyu also expressed his disappointment with the court's ruling to nullify the 2-trillion-baht borrowing bill for infrastructure development, which he said had resulted in opportunity losses for logistics development.

He said the plans under the 2-trillion-baht bill included the construction of 15 distribution centres to facilitate trade with neighbouring countries.

"The solution to the border trade problem has not been found yet," Mr Thongyu said. "The border checkpoints still face limitations and the long, 5km lines of congested traffic at the crossings are problematic."

The border transport problem has prompted Laos and Cambodia to buy goods from China and Vietnam instead, and that will be detrimental to Thai business operators in the long run, he said.

Meanwhile, Land Transport Department director-general Atchasatike Rattanadilok na Phuket yesterday said the agency is working with the LTFT and the Hazardous Substances Logistics Association to draw up measures to prevent cargo truck accidents.

A total of 126 accidents occurred involving goods lorries last year, he said. The major causes of the accidents were careless driving and speeding as well as drivers falling asleep behind the wheel.

Among the measures being worked on include the documentation of lorry drivers' details, a ban on drink driving, and a requirement for drivers to rest after every four hours of driving.

New weight limits, installation of Global Positioning Systems (GPS) in lorry carrying hazardous substances and penalties for careless driving would also be imposed.

Lorry drivers would also be required to strictly adhere to traffic and safety regulations, he said.

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