What's new in business news: August 9, 2013
Solution for high mobile phone bill shock, govt bank ready for rice scheme finance & no change in rice scheme price but once a year limit?
Solution for high mobile phone bill shock, govt bank ready for rice scheme finance & no change in rice scheme price but once a year limit?
Sa-nguan Mongkonsripanlert, a farm analyst from Krabi province, instructs BAAC staff on how to plant rice in a building. The state-owned bank wants office workers everywhere to start growing rice in their buildings to teach them the value of the grain and give them a better appreciation of farmers. APICHIT JINAKUL
TELECOMMUNICATIONS
AIS curbs 'bill shock' for 3G customers using data services
Advanced Info Service (AIS) has introduced an automatic data tariff adjustment to curb "bill shock", one of 3G users' worst experiences.
AIS has seen an increasing number of customer complaints about unexpectedly high mobile bills, particularly from new smartphone users.
Customers sign up for monthly tariff plans starting from 99 baht a month, rising to 799 baht for unlimited use.
The new service will bill them automatically in accordance with the most economical package based on their monthly use.
The company then charges 1.50 baht a megabyte for mobile data use exceeding the package limit, down from the 2-5 baht per megabyte previously charged.
3G service pushed AIS's postpaid data revenue to 2.8 billion baht in the second quarter out of total revenue of 36 billion.
2 million postpaid users out of 3.9 million are still inactive data users.
A mobile data customer uses an average 300 megabytes a month with 399-599 baht packages. Average revenue per postpaid user is 728 baht.
AIS's 37.6 million subscribers include 6 million 3G users now, expected to rise to 10.5 million by year-end.
AGRICULTURE
Lower rice pledging price or once-a-year pledging?
It is possible that the government will continue to buy rice at 15,000 baht a tonne under the pledging scheme for the 2013-14 main crop but limit pledging to only once a year.
The Commerce Ministry is negotiating with farmers on the price and considering two or three options. The most likely one is the price unchanged at 15,000 baht a tonne for the 2013-14 main crop but capping pledging at once a year.
This option would require working capital of 300 billion baht a year and hold the government's loss to 80-100 billion baht a year.
Other options include cutting the pledging price to 12,000 baht with a cap on the pledging value at 400,000 baht per household but this was described as "too cruel" to farmers.
The proposed price reduction is due to budget constraints, as the Finance Ministry sets the loss ceiling of the scheme at 70 billion baht a year.
The 12,000-baht price is based on newly estimated farmer costs of 6,000 baht a rai and productivity of 600-800 kilogrammes a rai.
The farmers' price proposal is based on a cost of 9,000 baht a rai and productivity of 300 kg per rai, calculated by the Agricultural Economics Office.
Rice farmer associations earlier proposed a pledging price of 13,500 baht a tonne.
The current pledging price is 15,000 baht a tonne, with a cap of 500,000 baht per household.
Most Thai farmers no longer rely on rain and can now grow rice more than twice a year.
AGRICULTURE & BANKING
BAAC backs up liquidity talk with B90bn advance for rice
The Bank for Agriculture and Agricultural Cooperatives (BAAC) insists it has enough liquidity to finance the next rice harvest year despite the massive amount of funds used for the past four crops.
The state-owned bank affirmed its healthy liquidity, as it set aside 90 billion baht as working capital for the pledging scheme.
The BAAC has 100 billion baht in liquidity, representing 12-13% of its total deposits and at least double the Bank of Thailand's requirement of 6% of total deposits.
The state bank also plans to raise its deposits by 18 billion baht this fiscal year ending next March 31. Its outstanding deposits stand at 1.018 trillion baht.
Though the policy rate was recently cut by 25 basis points, the BAAC has maintained its interest rate due to fierce competition from commercial banks in mobilising deposits.
Previously, the bank borrowed 410 billion baht from the Finance Ministry to finance past crop subsidies as approved by the cabinet.
Rice pledging amounts exceeded government projections with the BAAC serving as the government's tool to dispense the subsidy.
The Finance Ministry has demanded the BAAC advance the funding for pledging expenses outside of its borrowing budget. If the advanced funding exceeds 100 billion baht, the Commerce Ministry is obliged to repay the bank once it can sell government rice stock.
