Meanwhile, gold in Thailand hit an all-time high price of 34,400 baht per baht-weight (December 4 this year) following the weakening US economy, coupled with the Federal Reserve’s expectations to cut interest rates at the beginning of 2024.
As of December 28 this year, the price stood at US$2,087.00 per ounce, up 14.44% — by US$263.42.
Both gold spot and local 96.5% purity gold prices this year have shown significant adjustments, paving the way for a continuous upward trend in gold prices in 2024, possibly reaching historic highs. This is further fuelled by the Fed’s entry into a downward interest rate cycle in 2024, resulting in a downward trend in the US dollar and bond yields. Consequently, gold retains strong momentum moving forward.
▪︎ Battle of the beer-makers – Singha, Chang, and Carabao
Intensive competition looms in the beer market worth over 270 billion baht, as major energy drink company, Sathien Sathientham, announced a 4-billion baht investment to produce 200 million litres of beer, launching two brands — Carabao and Tawan Daeng. The move threatened to shake the fortresses of two giants, Singha and Chang. However, they also have to contend with the global brand, Heineken.
Before the debut of the contender in the beer market, anticipation was high, especially in the distribution channels, the powerhouse of trade for every brand. Market leaders Singha and Chang are not taking this challenge lightly, releasing new products to defend their market share.
The plot thickened as Sathien Sathientham, initially targeting third position in the beer market, now appears to aim higher, and seems ready to challenge the established Singha and Chang brands head-on. Thapana Sirivadhanabhakdi, CEO of Thai Beverage (Chang beer brand), sees competition as healthy, emphasising the need for adherence to the same rules.
Currently, the Singha beer-maker dominates the market with a combined share of around 56-57% (Singha, Leo, MyBeer), while Thai Beverage holds around 33% (Chang, Archa Federbräu), among others. How this beer market battle will unfold remains to be seen, as beer is a mass-market product that requires at least three months of consumer trial and acceptance nationwide.
For new beers, the nationwide trial period will be long, considering the vast consumer base across the country. Initially, there might not be noticeable impact in the honeymoon phase.
▪︎ AIS-3BB merger deal
After a meeting that lasted more than six hours on November 10, the National Broadcasting Telecommunications Commission (NBTC) decided to allow Advanced Wireless Network Co Ltd, a subsidiary of AIS, and Triple T Broadband Plc, an internet service provider under the 3BB brand, to merge under specific terms/conditions.
The reason stated is that even though the business merger might impact competition in the regular internet market and service prices, the scope and level of the impact are not severe. This is because it can be compensated with mobile telephone services, and there are still nearly 50,000 spots with public network access and almost 16% market share controlled by the NBTC. The current internet market has around 13 million users. Following the business merger, the number of major service providers will decrease from four to three, and the NBTC remains a service provider with an estimated 16% market share.
Regarding price control, specific measures have been put in place to prevent price hikes or reduction in service quality. They have mandated maintaining a minimum price package for fixed-line internet services for a duration of five years. AIS announced its market venture under the “AIS – 3BB Fibre 3” brand. The NBTC’s approval has positioned AIS as the market leader with a combined customer base of 4.69 million, consisting of 2.38 million AIS Fiber customers and 2.31 million 3BB customers.
▪︎ Esso exits Thailand after 129 years
Standard Oil Company of New York first opened its branch in Bangkok back in 1894, selling kerosene under the “Chicken” and “Eagle” brands. Despite facing crises, such as world wars, the company consistently invested in new business ventures, including oil refineries, exploration, and petroleum production.
The final chapter of the Esso brand in Thailand unfolded after January 12 this year when Bangchak Corporation Plc made an offer to purchase all securities of Esso (Thailand) Plc from ExxonMobil Asia Holdings Pte Ltd. The deal was worth 55 billion baht and took four years of negotiations.
Subsequently, on August 31, Bangchak Corporation completed the acquisition by purchasing 2,283,750,000 ordinary shares, accounting for 65.99% of the total issued and outstanding shares of Esso, from ExxonMobil Asia Holdings at 9.8986 baht per share, totalling 22.6 billion baht.
Bangchak gained control of both the Bangchak refinery in Phra Khanong and the Sri Racha refinery, with a combined production capacity of 294,000 barrels per day and a network of 2,100 service stations. The Esso stations, numbering 832, will undergo rebranding within two years. Additionally, Bangchak acquired a 21% stake in Thai Oil Pipeline Co Ltd and a 7.06% stake in Bangkok Aviation Fuel Services Plc.
▪︎ Thai EV market grows by nearly 600%
The electric vehicle (EV) market experienced a major surge in 2022, especially during the period from January to November. A total of 67,056 vehicles were registered — a staggering 589% increase compared to the entire 2021, which saw 9,729 registrations. The most recent data from November 2023 shows the highest monthly registration with 8,982 units.
This market expansion stems from the global EV trend, the introduction of numerous new car models, and continuous new players entering the market.
A significant factor contributing to this surge is the government’s EV promotion policy, known as EV 3.0, providing incentives averaging between 200,000 to 250,000 baht per vehicle. This policy was approved by the Cabinet on February 15, 2022. While car companies began utilising these incentives seriously towards the end of the year, 2023 marked the first full year of utilising these incentives, resulting in exponential growth in sales and registrations.
The trend indicates continued growth for EVs in 2024, despite the conclusion of EV 3.0 at the end of 2023. The government recently introduced EV 3.5, albeit reducing the subsidy from the previous maximum of 150,000 baht per vehicle to 100,000 baht per vehicle.
However, vehicles benefiting from EV 3.0 between 2022 and 2023, and those commencing domestic production (CKD) in Thailand between 2024 and 2025, will continue to receive the EV 3.0 incentives.
▪︎ Pheu Thai Party changes partners to lead coalition government
In the general election on May 14 this year, a wave of public support for Pita Limjaroenrat led the Move Forward Party to victory. Move Forward had the most seats in the lower House, ahead of Pheu Thai. The two parties engaged in talks to form a coalition government. However, the alliance failed to take off as Move Forward leader Pita could not win support from Parliament to be elected prime minister. The negotiations between Move Forward and Pheu Thai broke down, while there were also simultaneous moves for exiled Pheu Thai patriarch Thaksin Shinawatra to return to Thailand.
With Move Forward out of the picture, Pheu Thai stitched together a new coalition, led by Srettha Thavisin. They joined hands with the political parties of former prime minister Prayut Chan-o-cha and former deputy prime minister Prawit Wongsuwan.
Pita and Move Forward, despite winning the election, found themselves in the opposition. Moreover, several legal cases targeted Pita, resulting in the Constitutional Court ordering the suspension of his parliamentary duties, leading to Chaithawat Tulathon taking over the party leadership and leading the opposition in Parliament. The threat of dissolution still hangs over the party.
Former PM Thaksin Shinawatra returned to Thailand on August 22 this year, ending 15 years in exile. A royal pardon reduced Thaksin’s jail sentence from eight years to one year, but he is yet to undergo jail time as he has been receiving medical treatment at a police hospital. He has been labelled a privileged prisoner. Meanwhile, there’s ongoing scrutiny of his attempt to seek imprisonment outside the prison under the new regulations of the Department of Corrections.
