Business

Former Thaksin Commerce Minister, Somkid to Inject Billions into Thai Economy

Published

9 years ago

October 4, 2015

Bchcomber

Military junta drafts in former ally of arch-enemy Thaksin to work magic on growth and rural incomes

BANGKOK – Thailand’s new economics guru, Somkid Jatusripitak, is trying to turn around one of the region’s worst performers, offering some 136 billion baht ($3.7 billion) in interest-free loans and cash injections to help reinvigorate small businesses in the country’s rural heartland. At the same time, he is offering a series of tax waivers and other incentives to lure high-end manufacturers to the country and persuade those already here to stay.

It won’t be easy to get Thailand moving again, though, or the rest of Asia, for that matter.

“The problems are very different from before. In the 1990s it was the rich who were affected after the baht was floated,” Mr. Somkid said, referring to the continentwide currency crisis that spread out from Thailand.

“Today it’s the sluggish grass-roots economy that is holding us back,” he said in an interview. And if he needs to deploy more measures, “I have two or three more arrows in my bag,” Mr. Somkid said.

Worries about China’s growth have pushed down the stock valuations, currencies and the prices of everything from rubber and rice to oil and circuit boards, thinning out consumers’ wallets. Household spending has fallen sharply in Southeast Asia in particular. It dropped more than 4% on year in the second quarter in both Indonesia and Malaysia as the prices of commodities such as palm oil and rubber slumped.

The one bright spot in consumer spending might be China itself, where shoppers appear to be a little more resilient than their neighbors and expanded retail sales by 10.8% on year in August.

But in Thailand, where the central bank’s private consumption index fell 1.4% on year in August and dropped 1.8% in July, the problems are worsened by a sharp slump in exports—down nearly 7% on year in August—and the collapse of a government program to support rice prices.

“Things might get better next year if the global picture improves, but right now we need to get things happening before the patient goes into cardiac arrest,” said Supavud Saicheua, an economist with Phatra Securities in Bangkok.

The rice problem is especially severe. For three years, Thailand bought grain from farmers at up to double market prices in an aggressive attempt to jack up rural incomes and boost spending. The program fell apart in early 2014 after incurring paper losses of some $15 billion, with much of the grain left unsold in government warehouses. The prime minister at the time, Yingluck Shinawatra, is now fighting criminal charges for allegedly failing to intervene. She denies any wrongdoing.

The aftershocks of the rice debacle have swept through Thailand’s rice-growing heartland. Pranee Treesak said she and her family used to go to shopping malls or eat in local restaurant chains when rice-price supports were still in effect. “Sometimes we would drive to Hua Hin or Rayong to eat fresh seafood. We’d stay at a hotel near the beach,” Ms. Pranee said.

“Now my husband and I are relying on our oldest son for support and ask around for day jobs,” she said.

Her situation is being replicated across the country, from the south, where rubber is the main crop, and across the rice-growing plains which make up much of the rest of the country. Mr. Somkid says his task is to help keep people afloat until commodity prices improve and export shipments begin to tick up again.

But he also says Thailand has to change the way it views its role in the world economy. “We can no longer be a place where people manufacture things cheaply. That can be done cheaper in Myanmar or Cambodia,” he said. “That’s our real focus. We have to restructure the way our economy works.”

With that in mind, Mr. Somkid is aiming to attract the kinds of businesses that need to pursue research with tax breaks, particularly technology firms, and expand tourism. He is also encouraging low-margin textiles and footwear manufacturers to relocate to new economic zones near the borders of Myanmar and Cambodia, where they can skip Thailand’s 300 baht-a-day minimum wage—some $8.20—and instead pay lower wages to people who cross the border each day to clock-in at work.

Mr. Somkid, 62 years old, has tried something like this before. A dozen years ago, he left behind a career in marketing and academia to emerge as the architect behind a package of policies—ranging from cheap health care to establishing village investment funds—that collectively came to be known as Thaksinomics, after Thailand’s prime minister at the time and Ms. Yingluck’s brother, Thaksin Shinawatra.

His efforts were never fully realized. Mr. Thaksin was ousted in a coup in 2006, as was Ms. Yingluck’s government last year after a series of mass protests driven in part by middle-class opposition to Thaksin-style populism.

That Thailand’s current junta has hired a man so closely associated with their policies has been taken in some quarters as an admission that the country’s economy is in crisis. Mr. Somkid, though, says he views it as an opportunity to try again—but without the handouts of the past.

“What we need to do is create the conditions whereby people can start generating their own money. We must target the roots,” he said.

By James Hookway

Business

PepsiCo Reduces Revenue Projections As North American Snacks And Key International Markets Underperform.

Published

2 months ago

October 8, 2024

Salman

(VOR News) – In the third quarter of this year, Pepsi’s net income was $2.93 billion, which is equivalent to $2.13 per share. This was attributed to the company.

This is in stark contrast to net income of $3.09 billion, which is equivalent to $2.24 per share, during the same period in the previous year. The company’s earnings per share were $2.31 when expenses were excluded.

Net sales decreased by 0.6%, totaling $23.32 billion. Organic sales increased by 1.3% during the quarter when the effects of acquisitions, divestitures, and currency changes are excluded.

Pepsi’s beverage sales fell this quarter.

The most recent report indicates that the beverage and food sectors of the organization experienced a 2% decline in volume. Consumers of all income levels are demonstrating a change in their purchasing habits, as indicated by CEOs’ statements from the previous quarter.

Pepsi’s entire volume was adversely affected by the lackluster demand they encountered in North America. An increasing number of Americans are becoming more frugal, reducing the number of snacks they ingest, and reducing the number of times they purchase at convenience stores.

Furthermore, Laguarta observed that the increase in sales was partially attributed to the election that occurred in Mexico during the month of June.

The most significant decrease in volume was experienced by Quaker Foods North America, which was 13%. In December, the company announced its initial recall in response to a potential salmonella infection.

Due to the probability of an illness, the recall was extended in January. Pepsi officially closed a plant that was implicated in the recalls in June, despite the fact that manufacturing had already been halted.

Jamie Caulfield, the Chief Financial Officer of Pepsi and Laguarta, has indicated that the recalls are beginning to have a lessening effect.

Frito-Lay experienced a 1.5% decline in volume in North America. The company has been striving to improve the value it offers to consumers and the accessibility of its snack line, which includes SunChips, Cheetos, and Stacy’s pita chips, in the retail establishments where it is sold.

Despite the fact that the category as a whole has slowed down in comparison to the results of previous years, the level of activity within the division is progressively increasing.

Pepsi executives issued a statement in which they stated that “Salty and savory snacks have underperformed year-to-date after outperforming packaged food categories in previous years.”

Pepsi will spend more on Doritos and Tostitos in the fall and winter before football season.

The company is currently promoting incentive packets for Tostitos and Ruffles, which contain twenty percent more chips than the standard package.

Pepsi is expanding its product line in order to more effectively target individuals who are health-conscious. The business announced its intention to acquire Siete Foods for a total of $1.2 billion approximately one week ago. The restaurant serves Mexican-American cuisine, which is typically modified to meet the dietary needs of a diverse clientele.

The beverage segment of Pepsi in North America experienced a three percent decrease in volume. Despite the fact that the demand for energy drinks, such as Pepsi’s Rockstar, has decreased as a result of consumers visiting convenience stores, the sales of well-known brands such as Gatorade and Pepsi have seen an increase throughout the quarter.

Laguarta expressed his opinion to the analysts during the company’s conference call, asserting, “I am of the opinion that it is a component of the economic cycle that we are currently experiencing, and that it will reverse itself in the future, once consumers feel better.”

Additionally, it has been noted that the food and beverage markets of South Asia, the Middle East, Latin America, and Africa have experienced a decline in sales volume. The company cut its forecast for organic revenue for the entire year on Tuesday due to the business’s second consecutive quarter of lower-than-anticipated sales.

The company’s performance during the quarter was adversely affected by the Quaker Foods North America recalls, the decrease in demand in the United States, and the interruptions that occurred in specific international markets, as per the statements made by Chief Executive Officer Ramon Laguarta.

Pepsi has revised its forecast for organic sales in 2024, shifting from a 4% growth rate to a low single-digit growth rate. The company reiterated its expectation that the core constant currency profitability per share will increase by a minimum of 8% in comparison to the previous year.

The company’s shares declined by less than one percent during premarket trading. The following discrepancies between the company’s report and the projections of Wall Street were identified by LSEG in a survey of analysts:

SOURCE: CNBC

Business

Old National Bank And Infosys Broaden Their Strategic Partnership.

Published

2 months ago

October 8, 2024

Salman

(VOR News) – Old National Bank, a commercial bank with its headquarters in the Midwest, and Infosys, a firm that specializes in information technology, have recently entered into a strategic expansion of their link, which has been in place for the past four years.

This expansion is more likely to take place sooner rather than later, with the likelihood being higher.

For the purpose of making it possible for Old National Bank to make use of the services, solutions, and platforms that are offered by Infosys, the objective of this expansion is to make it possible for the bank to transform its operations and processes through the application of automation and GenAI, as well as to change significant business areas.

This lets the bank leverage Infosys’ services, solutions, and platforms.

Old National Bank Chairman and CEO Jim Ryan said, “At Old National, we are committed to creating exceptional experiences for both our customers and our fellow employees.”

This statement is applicable to Old National Bank. Infosys is carefully managing the business process innovations that it is putting us through, putting a strong emphasis on efficiency and value growth throughout the process to ensure that it is carried out efficiently.

This is a routine occurrence throughout the entire operation. Because of Infosys’ dedication to our development and success, we are incredibly appreciative of the assistance they have provided.

Old National has been receiving assistance from Infosys in the process of updating its digital environment since the year 2020, according to the aforementioned company.

Ever since that time, the company has been providing assistance. The provision of this assistance has been accomplished through the utilization of a model that is not only powerful but also capable of functioning on its own power.

Infosys currently ranks Old National thirty-first out of the top thirty US banks.

This ranking is based on the fact that Old National is the nation’s largest banking corporation.

It is estimated that the total value of the company’s assets is approximately fifty-three billion dollars, while the assets that are currently being managed by the organization are valued at thirty billion dollars.

Dennis Gada, the Executive Vice President and Global Head of Banking and Financial Services, stated that “Old National Bank and Infosys possess a robust cultural and strategic alignment in the development, management, and enhancement of enterprise-scale solutions to transform the bank’s operations and facilitate growth.”

This remark referenced the exceptional cultural and strategic synergy between the two organizations. Dennis Gada is the one who asserted this claim. This was articulated explicitly concerning the exceptional cultural congruence and strategy alignment of the two organizations.

We are pleased to announce that the implementation of Infosys Topaz will substantially expedite the transformation of Old National Bank’s business processes and customer service protocols. We are exceedingly enthusiastic about this matter. We are quite thrilled about this specific component of the scenario.

Medium-sized banks operating regionally will continue to benefit from our substantial expertise in the sector, technology, and operations. This specific market segment of Infosys will persist in benefiting from our extensive experience. This phenomenon will enable this market sector to sustain substantial growth and efficiency benefits.

SOURCE: THBL

Business

American Water, The Largest Water Utility In US, Is Targeted By A Cyberattack

Published

2 months ago

October 8, 2024

kiaragrace

The largest regulated water and wastewater utility company in the United States stated Monday that it had been the target of a cyberattack, forcing the company to halt invoicing to consumers.

American Water, The Largest Water Utility In US, Is Targeted By A Cyberattack

American Water, based in New Jersey and serving over 14 million people in 14 states and 18 military facilities, said it learned of the unauthorized activity on Thursday and quickly took precautions, including shutting down certain systems. The business does not believe the attack had an impact on its facilities or operations and said employees were working “around the clock” to determine the origin and scale of the attack.

water

The corporation stated that it has alerted legal enforcement and is cooperating with them. It also stated that consumers will not be charged late fees while its systems are unavailable.

According to their website, American Water operates over 500 water and wastewater systems in around 1,700 communities across California, Georgia, Hawaii, Illinois, Indiana, Iowa, Kentucky, Maryland, Missouri, New Jersey, Pennsylvania, Tennessee, Virginia, and West Virginia.

SOURCE | AP