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Thai-Norwegian Business Review 2013 – 03

Thai-Norwegian Chamber of Commerce

Successfully branding Norway

Thailand’s skies welcomes Norwegian


Contents President’s foreword

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World Economic Forum: An open canvas for telecom in Myanmar

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Branding Norway

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Presenting a united front Team Norway concept to help brand Norwegian business abroad

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Norway: An umbrella brand for Norwegian industries

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A branding case study: Telenor’s success in other countries

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From the clear, cold waters of Norway

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Norwegian: Flying soon to a destination near you

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Felicia: Inspired by northern lights

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True colours: The penguin story

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Telenor successful applicant for telecommunications license in Myanmar

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Norway-Asia Business Summit 2014, the next big event on the Chamber agenda

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Smooth sailing

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Nordea opens private banking branch in Singapore

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Wearnes Automotive Volvos: A safe bet for the younger generation

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Samitivej Hospitals: Letting service speak for itself

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Unlocking labour productivity: ict’s role in Thailand’s future economy

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TNCC Summer Party

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Thailand’s economy at a glance

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Getting to know the members: Jon Anders Aas Haug

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Members’ directory

53 Editor: Thitikul K. Opdal Advertising: Anders Magnusson Journalists: Eric Baker, Ezra Kyrill Erker, Nellie Willow, Anton Benzon Graphic Design: Andrew Spaulding www.norcham.com

Cover: Christian Chramer, Regional Director South East Asia for Norwegian Seafood Council

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Thai-Norwegian Chamber of Commerce


President’s foreword It’s 25 degrees and a soft breeze comes from the sea, beyond the fjord in the distance you see the Folgefonna glacier with its snow-capped mountains; wait, I think I just saw a salmon make a summersault in the crystalclear stream! Norway has just presented itself from its best, bringing meaning to the slogan NORWAY Powered by Nature. As brand ambassadors for our country, we are proud of Norway and its nature but also the social values and the egalitarian system it represents. In Thailand when mentioning Norway, the midnight sun, the North Cape, Hurtigruta and salmon come to mind. I would like to take the opportunity to congratulate one of Norway’s most recognised brands—Telenor—for their great achievement in Myanmar; they recently secured one of two telecom licences in the country. It has been a busy time since we returned from our summer holiday; our new branded webpages are up and running and it will be our main tool for member communication, so add it to your favourite folder: www.norcham.com A new person has joined the Chamber team, Director of Sales and Marketing Anders Magnusson. In our small Team, he works closely with the journalists to make sure we get professional and up to date articles of interest to our readers. His main focus is sales, sales, sales. He will be our very own ‘selling machine’. For those of you who have not had the pleasure of a phone call or visit from Anders, - be ready! He will be there with a big smile, convincing you in no time to sign up for advertising in the next four issues of Business Review and rightly so, it is an excellent channel to promote your company and your services! The new Chamber Team is now working on Branding and Strategy for 2014 and onwards. We have put strong focus on the findings from the survey done earlier this year; our members expressed their appreciation for the Business Review as a quality magazine. We were also requested for more business and social networking. So, please remember: for any event to be successful, we need not only your support but also your attendance. We plan to introduce the first stage of this work to the Chamber members towards the end of the year, so remember to check your mail or our webpages for updated to not miss this event. This autumn we plan a dinner talk with Telenor’s Sigve Brekke 29 October, a Get to Know the members event in November, and of course our annual Christmas Party in December. Please also make sure to mark your calendar for 25-29 April, 2014 when our Chamber will have the pleasure of hosting the next Norway-Asia Business Summit. Happy reading! Greetings from seat 23A, destination Hong Kong. Vibeke Lyssand Leirvåg Conselvan President

Thai-Norwegian Business Review

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World Economic Forum: An open canvas for telecom in Myanmar by Eric Baker

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art of the lure of Myanmar for international investors is that in so many sectors, it really is uncharted territory—you can set your own course. And so it is for telecom, where less than 7% of the population has a mobile phone, and only 1% has a wired connection, the third-lowest penetration rate in the world behind North Korea and Eritrea. Prior to approval of a pending telecom law this year, the previous regulation in Myanmar dates back to 1885. This is truly virgin waters for the entrepreneur, and a few months back Telenor was granted one of the licences to operate a telecom business in that country. This was the setting for the World Economic Forum (WEF) on East Asia that took place in Nay Pyi Taw, Myanmar, in June 2013. Myanmar is slated to take over the chairmanship of ASEAN in 2014, with the ASEAN Economic Community scheduled for late 2015. One of several subjects addressed was how changes in telecom in Myanmar and the region will affect living conditions in the near future. A lot of services people take for granted are not available in Myanmar, as an estimated 74% of the population lack access to power and live amidst very rudimentary infrastructure. For ICT (information and communications technology) infrastructure, there are “particularly significant” gaps among ASEAN members in the use of the internet and mobile broadband penetration, with Myanmar finishing near the bottom, reported the WEF Travel & Tourism Competitiveness Report 2013. The country also has a drop-out rate of 23% between primary and secondary school, the highest in East Asia and McKinsey Global Institute put’s the average schooling at four years according to “Myanmar’s Moment, Unique opportunities, Major challenges”, their report issued in June this year. But most of the business leaders were optimistic about the influence and potential of telecom in Myanmar. Sunil Bharti Mittal, the chairman and group chief executive of Bharti Enterprises Ltd, pointed to mobile banking, mobile education and entrepreneurship as the benefits of mobile penetration in the economy. He also believes the Myanmar government is

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Thai-Norwegian Chamber of Commerce

committed to using information and telecommunications technology to better the lives of its people. Thaung Tin, deputy minister in Myanmar’s Communications and Information Technology Ministry, said the government aims to have 50% telephone density by 2015, which means half the people living in a designated area have telephone connections. One of the criteria for the telecom licences the government just granted was coverage of 92% of the population within five years, and covering a certain percentage of universities, hospitals and major towns within the first year. “The telecommunications landscape of Myanmar should be totally different two years from now,” said Thaung Tin. But he emphasised that Myanmar’s education system is not able to produce enough capable graduates for service this industry on its own, so that outside expertise was needed for training and technology. “It is urgent that we create human capital that is ready for the industry,” he said. “But for now, we need international operators that have years of experience.” Dan’l Lewin, Microsoft Corporation’s corporate vicepresident for strategic and emerging business, declared “Myanmar’s telecom development has the opportunity to develop human potential”. He added that data sovereignty, public policies and privacy issues need to be normalised for private investment to occur. “Enterprises and ecosystems strive without friction, and governments create friction. But without government participation in the US there would be no Silicon Valley. Then the government kind of got out of the way, and we ended up with machines that automated regular tasks. Entrepreneurs need an environment where they can do business,” he said. Phone calls in Myanmar cost six US cents per minute now, but analysts believe they will drop to two to three cents per minute once infrastructure starts being built.


Cover story

Branding This issue of Business Review focuses on branding and more specifically about branding Norway. Norway has several years in a row been voted the best place in the world to live. National Geographic Magazine has also voted the fjords of Norway as the world’s best tourism destination. We can certainly be proud of the accolades. But Norway is more than nature although nature is features strongly in national branding; you may have seen and heard the slogan “Powered by Nature”. Norway is a world leader in renewable energy with 98% of Norway’s electric power coming from renewable resources. In addition, Norway is the world’s largest salmon exporter with fish coming from “the clean cold waters of Norway” and finally the Norwegian offshore industry is considered one of the most advanced in its field and Norwegian design ships are not far behind.

We all know individual Norwegian brands like Jotun, Telenor and Yara, to mention a few, but how to brand a whole nation? That is a task Norway’s Ministries of Trade and Industry and Foreign Affairs have recent taken on through revitalisation of the Team Norway concept idea: “We are too small on our own so let’s stand together and help each other” is the message. This has direct impact on Norwegian business and the message is: official Norway and its agencies as well as interest organisations like the chambers of commerce are ready to help.

To the question “What is a strong brand?” I end by quoting Olympic gold medallist Florence Griffith Joyner: “What do you need to be the best? Concentration. Discipline. A dream.”

Read on and you’ll see

Thai-Norwegian Business Review

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Team Norway

Presenting a united front Team Norway concept to help brand Norwegian business abroad The Norwegian government wants its embassies and consulates to have a more coordinated approach to promoting the country’s economic interests abroad, using a platform called Team Norway that will attempt to present a more unified front in foreign markets.

text by Eric Baker

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his concept has been percolating in the Ministry of Foreign Affairs for some time, but it was reinvigorated at a recent meeting of ambassadors, said H.E. Katja Christina Nordgaard, the Norwegian ambassador to Thailand.

“We have been following a similar philosophy for a while. But all the Norwegian stakeholders have to become better at working together, figuring out how best to protect and promote our common interests,” said Ms Nordgaard. “Innovation Norway and the Thai-Norwegian Chamber of Commerce and the embassy all communicate now, but we have to try and develop a strategic plan. Part of this is a realisation that with the world economy like this for the last few years, several countries are tightening their belts, so it becomes imperative that we work harder amidst tight competition.” Part of this concept is branding the way people in other countries think about Norway and Norwegian businesses.

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Thai-Norwegian Chamber of Commerce

“In talks with people abroad, we have projected the image that Norwegian companies are reliable, competent and capable of using advanced technology,” she said. “When you throw in that most of our companies have very solid social responsibility profiles and our zero-tolerance for corruption, we have to emphasise our quality because no one is going to look to Norway for cheap labour.” The other part of Team Norway is having the embassy and related agencies actually set up or host business meetings with interested Norwegian investors and local contacts. This can involve organising business matching events or having an ambassador host a dinner at his or her residence where a serious Norwegian investor gets to know some of the local interested parties. Both the embassy and established overseas Norwegian businesses can provide access to relevant decision-makers in another country so new investors can better decide whether to expand abroad. “I’m a big believer in having the big companies try to open doors for mid-sized businesses,” said Ms Nordgaard. “They can also provide advice, and if possible, help bring them along in a new market.”


Ms Nordgaard reiterated the real value in the scheme is having some coordination. “Some of these tasks were already being accomplished, but everybody is so busy it was not always coordinated. We need to have follow-up, that is the key,” she said. The ambassador said she is always open to big ideas and new suggestions from the Norwegian business community in Thailand about how to represent themselves here, but sometimes community members feel constrained because the business interests here are so diverse.

“In talks with people abroad, we have projected the image that Norwegian companies are reliable, competent and capable of using advanced technology... We have to emphasise our quality because no one is going to look to Norway for cheap labour.” —H.E. Katja Christina Nordgaard

“This is why the Asia Business Summit all our organisations are hosting next April is such a big deal,” said Ms Nordgaard. “We already have the support of our people here in Thailand, but we need to make sure we draw a lot of people from Norway as well.”

“One example of how we already cooperate is when we had the Polar Exhibition here in Bangkok, as Innovation Norway, the embassy and the chamber all worked to bring in companies that focus on climate change so they could showcase their products.

Embassies are also supposed to issue warnings about potential risks for investors abroad under this directive, such as crime, natural disasters, terrorism, piracy, political instability, and barriers to business entry. But this can be tricky if you note something negative about a host country in writing and people in the country eventually see it, said Ms Nordgaard.

“Another example is that during the big floods here in 2011, we had a Norwegian company that builds simple flood walls come in and we helped arrange a meeting with the Bangkok governor. The company mentioned wanting to start production here, which was well received because the sandbags were a toxic solution.”

“We will probably continue as we have been doing, which is we tell potential investors about these risks when they come here face to face, rather than put anything down in writing,” she said. “This is why we are so careful about our travel advisories and have a high threshold before issuing one, because it can affect our businesses here too.”

Embassies will also be charged with looking on the horizon for market opportunities, but these are not market reports Ms Nordgaard cautioned that this is limited by staff capabilities.

Ms Nordgaard pointed out the embassy is also very open to Thai companies looking to invest in Norway, helping to facilitate all the necessary documentation, and boasting that the Norwegian embassy processes visas the fastest of any of the Schengen countries.

“The point is to let people know back in Norway if a new law passes in a country or a situation changes that might present an opportunity. Of course there are limits, and Norway is not a big country, so we can’t have investment in every country in the world. But the point is to provide the information so investors can decide on their own,” she said.

Business interest groups such as the Norwegian Seafood Council and INTSOK (Norwegian Oil and Gas) will also be involved in the effort, and the ambassador’s hope is that the parties involved can ultimately reach a point where the embassy and chamber make a presentation in foreign countries about the values Norway represents, followed by companies showcasing what kinds of products or services they offer.

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Norway: An umbrella brand for Norwegian industries Former Thai-Norwegian Chamber of Commerce president, Axel Blom, speaks on Norway’s new branding strategy text by Ezra Kyrill Erker

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any around the world would probably suspect Norway of being a producer of high quality products but would be hard-pressed to name a single Norwegian brand. For the international consumer, neighbouring Sweden, Denmark and Finland each probably produce more name brands that come to mind. Yet despite the lack of recognition Norwegian products and services are all around us in Thailand, from telecommunications to paints, seafood and maritime services, as well as being active in the automotive, agriculture and banking industries, among others.

To tackle the shortfall in brand recognition, the Norwegian Government through Innovation Norway is embarking on a design strategy that will make Norwegian industries more recognisable: Through stark lines, fixed angles and prescribed shades of grey, aquamarine and red, as well as an evocative archive of stock photography, Norway itself becomes a brand, with the tag line “Powered by Nature”. Clusters and sectors can use it for industrial fairs and conferences; the logo, templates and labels can be combined with individual companies’ symbols and trademarks to become collectively identifiable. Innovation Norway representative in Bangkok, Axel Blom, sat down with the Review to explain the concept’s benefits and potential applications for Norwegian companies in Norway and abroad, as well as for the Norwegian tourism industry. “Branding is a difficulty for Norwegian companies,” Mr Blom says. “Very few brand names are known, so there is a need to raise awareness of Norway and Norwegian companies and to try to build an umbrella brand which will be easier to be recognised abroad, and to use this umbrella brand in all concepts in and outside of Norway, especially in

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Thai-Norwegian Chamber of Commerce

clusters, such as in the maritime cluster and the energy and environment sector. That’s where you see the application right now.” The Innovation Norway office in Thailand works predominantly in the energy and environment sector but also with marine products such as fish and seafood, Mr Blom explains. The Singapore and Malaysia offices typically work with oil and gas and the maritime sector, which are very important for Norway in those countries and internationally.

“Branding is a difficulty for Norwegian companies,” Mr Blom says. “Very few brand names are known, so there is a need to raise awareness of Norway and Norwegian companies and to try to build an umbrella brand which will be easier to be recognised abroad.” “The branding concept is relatively new,” he says. “I’d say about a year and a half old. I don’t think any individual companies have used it yet; it’s more for use on a cluster basis. Individual companies will typically want to use their own brand, and I don’t see a problem with that. These are typical pan-Norwegian initiatives, and we need to build awareness of the branding in Norway before we can start applying it internationally.”The concept is strict in terms of design, angles and colour. The angle must match the degree of the middle stroke of the N in Norway. Colours comprise four acceptable shades of aquamarine blue, solid red and grey. Lettering can be white, black or two tones of grey. It


is a challenge for designers, but staying strict to the template is critical to the initiative’s success. The Thailand office may be one of the first Innovation Norway offices trying to promote the concept internationally, due in part to Mr Blom’s personal interest in branding design. In his previous position with Scandinavian Airlines he was heavily involved with branding, and the company was at the forefront when it came to such initiatives.

Innovation Norway’s Thailand team members Axel Blom and Yanin Srathongnoi at National Science and Technology Fair in 2012 showcasing Norway-branded exhibition material

“By using the same branding concept it’s easier for companies and clusters to get recognised. At Innovation Norway we haven’t got very far in using it outside of the maritime sector. We have started to apply it toall fairs and exhibitions outside Norway, for example. For the Norway-Asia Business Summit [April 25 to 29, 2014, in Bangkok], we have decided to use the branding concept for the whole summit.” Companies interested in the concept can have their designers download materials in English or Norwegian at the website, www.innovationnorway.no, including templates, logos and stock imagery for free. Advice on application is readily given. “We’re very generous in that respect,” Mr Blom said, “but strictness in application of the design is necessary.”

Being situated in Thailand is no handicap in this regard, he said, as web design in Thailand is of high quality and is often available at a lower cost than in Norway. “We’re trying to develop it for the Norway-Asia Business Summit and see if they approve our design in Norway, and in that case they have another way that it can be applied. We are inventing as we are going along.” Mr Blom was president of the Thai-Norwegian Chamber of Commerce for six years until Vibeke Lyssand Leirvåg Conselvan took over this year. His company, Blue Business Solutions, represents Innovation Norway in Thailand. The latter is wholly owned by the Norwegian government, with the mandate of supporting SME businesses.

Consistency in application is necessary in order to achieve benefits in the long term, but the concept is still in a nascent phase that will take time to become recognisable and viable.

“Innovation Norway helps companies start up in Norway, grow in Norway and when they are ready for the international market Innovation Norway assists the company in finding new marketplaces and client bases and expanding internationally.”

“We are testing new ground with the application of the concept constantly, for instance we have only used it for media advertising a few times and in this respect we need to work with the material to find the optimal balance between the communication message and the design concept. In addition we have neverbuilt a website using the branding concept, but we’re going to do that.”

As for branding Norwegian industries and services, the process will take time, he says, but it is necessary to make the first inroads. “You have to start somewhere. The Norway-Asia Business Summit is a great way for us to start branding it. This is a major all-Asia initiative where the Norwegian companies will come and it can be a good vehicle to get the awareness out.”

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Continued from page 13

OMDØMME- OG MERKEVAREBYGGING

BUSINESS DELEGATION TO MYANMAR, APRIL 2013

Norway is the smallest among the Scandinavian countries but unknown to many it is a world leader in a number of industries such as oil and gas, maritime and energy & environment.

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“We need to start seeing Norway as an umbrella brand that is recognised as such when we apply it. We need to be strict in order for the brand to be recognized as well as the attributes it stands for: high quality, sustainability, being environmentally friendly. This is a completely new concept for Norwegian companies.”

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Despite the reach of Norwegian companies in Thailand such as Jotun, Telenor, Wallenius Wilhelmsen Logistics and Yara, in terms of recognition Norway still lags behind its neighbours.

PMS 3005, CMYK 100 35 0 0, RGB 0 125 200

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“Denmark and Sweden have a better spread of international brands. Denmark has traditionally been exceptionally good at design and branding, the Danish furniture industry is an example of this. Sweden with its large industrial base also have a number of well recoginsed brands. Norway is the smallest among the Scandinavian countries but unknown tio many it is a world leader in a number of industries such as oil and gas, maritime and energy & environment..” 20

Fellow EFTA member Switzerland has always been good at branding, establishing a reputation of quality, he says. In Mr Blom’s field of aviation, Swissair was one of the first to focus on its brand recognition. SAS likewise did research on global impressions of Scandinavian products, and key terms that came out of it included “modern”, “innovative”, and “informal”. This brand matrix helped SAS position itself on the international arena. Even without the logo, Mr Blom says, people could recognise the company literature by touch and feel. Brand Norway should likewise evolve into a recognisable force.

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YANMAR

BUSINESS DELEGATION 3-4 APRIL 2013

Thai-Norwegian Chamber of Commerce

results.

Maritime, oil and gas, energy and environment clusters will adopt it consistently for fairs, exhibitions, seminars, Mr Blom says. The concept has its origins in a branding system designed for the Norwegian tourism trade which has used the design, including the slogan “Powered by Nature”, since 2007. Norway’s tourism website, www. visitnorway.com, has won several awards for tourism website design. Use in the branding of Norwegian industry will have the secondary benefit of promoting Norway itself, though, as a nation and as a travel destination. For local use, the “Powered by Nature” slogan has been translated into Thai language and script. “We’re trying to get more Thais to go to Norway. At the moment it’s mainly a destination for those who’ve been to Europe, say two times. Third time’s to Norway. The draw? It’s a country powered by nature.” Well heeled Thai visitors are attracted by the competitive prices of luxury goods and scenic side trips such as buffet


lunches on Icelandic glaciers. Helpful in the tourism respect will be Norwegian Airlines’ new expansion into Thailand. “It’s the first intercontinental low-fare operator between Europe and Thailand, and it will be interesting to see the company’s impact on Norway’s tourism industry in the future.” Mr Blom says. Innovation Norway remains a key component of Team Norway, representing the country’s interests abroad.

“Every country’s Team Norway usually consists of Innovation Norway, the Chamber of Commerce and the Norwegian Embassy in addition to other governmental support organisations.” These bodies coordinate closely to provide a team response to the vagaries of the marketplace, economic or political turbulence and identifying pan-Norwegian issues and shortfalls, such as the one of how to create brand recognition for the nation’s industries.

Clockwise from above: Solvorn in luster. Photo: Erik Jørgensen / visitnorway.com; Stavanger, oil platform. Photo: Anders Nielsen/Innovation Norway; Bourbon Orca 2. Photo: Harald Valderhaug

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A branding case study: Telenor’s success in other countries text by Eric Baker

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ow do you localise a global grand? There’s no one right answer, but Telenor Group has found a way given its success in 12 countries, soon to be 13 given the finalisation of negotiations in Myanmar. You can either partner with a local company, as Telenor did in Thailand to create dtac, or you can create a local version of your company, as it plans to do in Myanmar. But certain hallmarks must remain the same. The Thai-Norwegian Business Review interviewed Glenn Mandelid, director of communications for Telenor Group, to get a better idea of what is required in overseas branding. “When you’re partnering with other shareholders, you have to consider what the brand represents globally,” said Mr Mandelid. “You have to keep a common set of working values, including easy access to top management and an open working environment. But above all, you have to understand the local customer.” For example, in Thailand the market is quite different than in Europe, he said. “Here it is all about topping up. It is the same mentality as buying chewing gum at a convenience store. Thailand is a prepaid market and up until recently the focus was on voice service. Now the focus is on data, and your ad campaigns here have to be funny or emotional to work,” said Mr Mandelid.

Glenn Mandelid

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“We have a lot of statistics that analyse consumers here, but our top management also spends a lot of time in the marketplace to meet customers and see what works, what doesn’t work, and what are the thresholds for buying.” He added that foreign ownership doesn’t matter to Thai customers, as most Thais would not even recognise the name Telenor. This is by design, as locals know only dtac or the Happy brand because their concern is merely which brand gives them the quality services at the best price. And while Telenor is very hands-off with dtac, letting them run their business, in Myanmar Telenor will wholly own the telecom business. Still, several elements will be similar, said Mr Mandelid. “The graphic components will remain the same,” he said. “The logo, the font, the corporate branding guidelines— these will all be constant. But you have to allow flexibility as well, such as the red smiley-face logo they have for the Happy brand.” So if Telenor is hands-off, how does it ensure dtac represents its brand in a proper manner? “We understand there needs to be a high degree of localization, as one size definitely does not fit all in various telecom markets,” said Mr Mandelid. “But our stakeholders need to understand the value of what Telenor represents. You have to build the company culture in a certain way, and we believe that starts with hiring the right employees.”

“Here it is all about topping up. It is the same mentality as buying chewing gum at a convenience store. Thailand is a prepaid market and up until recently the focus was on voice service. Now the focus is on data, and your ad campaigns here have to be funny or emotional to work.”

Thai-Norwegian Chamber of Commerce

Mr Mandelid said Telenor’s long-term commitment to its overseas operators was likely one of the factors that convinced Myanmar to grant it a telecom operating licence. “We’ve been in Thailand for over 10 years. When we entered Asia in 2000, all the large Western operators were here.


But now only Vodaphone remains in India, and Telenor is the only large operator in more than one market. Myanmar will be our sixth market, along with Pakistan, India, Bangladesh, Malaysia and Thailand,” he said.

But the final emphasis still needs to be on the customer, said Mr Mandelid.

“In other words, our message is we’re here for the long haul, and we brand for the long haul.”

“Everything we do needs to be customer-centric,” he said. “A couple years back we had a branding campaign that ‘Telenor is built for people’s needs’. We have to live up to that sentiment as it’s written on the back of all our business cards.”

He noted there are other aspects that may have swayed Myanmar. Telenor has studies, as do most telecom companies, that there is a direct correlation between access to mobile telephony and data and increased economic growth.

“I’m happy to be working for a company that actually interacts with people in their daily lives. There are a few bigger companies in Norway, but they sell oil and gas to retailers, not expressly to customers. At Telenor we have a direct impact on customer’s lives.”

Velkommen, välkommen, tervetuloa, welcome ...

Nordea opens International Private Banking branch in Singapore With the opening of its new private banking branch in Singapore, clients resident in Asia can benefit from Nordea’s wealth management expertise, global market access and Nordic approach to doing business, while maintaining their account in the Asian financial centre of Singapore. Address: Nordea Bank S.A., Singapore Branch, 3 Anson Road, #20-01 Springleaf Tower, Singapore 079909 Visit us at www.nordeaprivatebanking.com, call +65 65 97 10 82 or email nordea@nordea.sg for more information or to set up a personal meeting.

Making it possible

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Nordea Bank S.A, Singapore Branch is part of Nordea Group, the leading financial services group in the Nordic and Baltic Sea regions. Some products and services may, due to local regulations, not be available to individuals resident in certain countries and their availability may depend, among other things, on the investment risk profile of persons in receipt of this publication or on any legislation to which they are subject. Nothing in this publication should be construed as an offer, or the solicitation of an offer, to purchase, subscribe to or sell any investment or product, or to engage in any other transaction or provide any kind of financial or banking service in any jurisdiction where Nordea Bank S.A., Singapore Branch or any of its affiliates do not have the necessary licence. Published by Nordea Bank S.A., R.C.S. Luxembourg No. B 14.157 on behalf of Nordea Bank S.A., Singapore Branch, 3 Anson Rd #20-01, Springleaf Tower, Singapore 079909, subject to the supervision of the Monetary Authority of Singapore (www.mas.gov.sg). www.nordeaprivatebanking.com

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Seafood from Norway: Raised in clear, cold water text by Eric Baker

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orwegian seafood enjoys an enviable market position in Thailand. This didn’t come about by accident, so the Business Review decided to interview Christian Chramer, the Norwegian Seafood Council’s regional director for Southeast Asia. The council represents all the country’s seafood exporters, who ship to over 100 different countries. Was it hard to brand Norwegian seafood in the beginning? Did you have to educate consumers and suppliers about why Norwegian seafood is a premium product? CC: Norwegian Seafood is not new in Thailand or Asia, but our marketing activity has been very limited over the last few years. I would say that after the first six month of operations in Thailand the market seems quite ready for more marketing activity, and retailers, hotels and restaurants are very open to more marketing of Norwegian salmon.

CC: Norwegian salmon farmers were the ones who started the revolution of salmon farming some 40 years ago in the fjords of Norway. The innovative, cutting-edge technology used today has been developed over these years and gives Norway its leading role in salmon production. Norway is a leader both in volume and global distribution, as our salmon is sold to more than 100 countries. To give the shortest possible answer as to why we are the best: Our global leading technology brings a high quality product, from the small fry to the full-sized salmon raised in cold, clear waters. As well, Norway’s geographic position, efficient production and advanced logistics solutions allow us to reach markets as far away as Japan within 36 hours from harvesting. This combined with skilled workers, salmon farmers, world-leading standards and governmental control and regulations makes our salmon probably the best in the world.

Norwegian salmon enjoys a very good position in the market, with lots of long-term relations both to professionals and consumers. The story of salmon from the cold, clear waters of Norway seems to be well known. Still, the competition is stiff so the Norwegian Seafood Council that works on behalf of seafood producers and exporters in Norway must step up to maintain and strengthen their role as market leader in Thailand.

For several vendors, there needs to be some type of mix between quality and price. What can you tell potential clients about why they should splurge for Norwegian seafood?

I notice that in some high-end eateries they mention Norwegian salmon by name on the menu or at the buffet table. How long from the start of the marketing process does it typically take for an eatery to start mentioning the origin or brand of your seafood? Of course, it is in the best interest of the vendor to mention it, but there are several imported foods in Bangkok where the origin is not specifically listed.

I notice that sustainability is a part of your marketing approach. Do Thai or Southeast Asian buyers care about sustainability yet or is the market not mature enough? Do you check that your members are using sustainable practices?

CC: The branding of salmon as Norwegian is often done on the restaurant’s own initiative and not necessarily as a result of our work. Both professionals and consumers have a high regards for Norwegian salmon, and identifying it as so can often command a higher price.

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For our readers who haven’t eaten any before, what specifically makes Norwegian seafood “the best in the world”?

Thai-Norwegian Chamber of Commerce

CC: This is quite simple: Norwegian salmon is available fresh 365 days of the year. High volumes (1.2 million tonnes last year) secure stable deliveries of high-quality Norwegian salmon.

CC: We see sustainability as a major part of our operations in Norway and the industry as a whole, both the government and individual producers, put a lot of effort into this area. The market demand for eco-solutions is still not at a high level, but we expect that these issues will be more important for both professionals and consumers in the future and aim to be ready with information, high standards and documentation when the questions are raised.


“Norway’s geographic position, efficient production and advanced logistics solutions allow us to reach markets as far away as Japan within 36 hours from harvesting.”

THE LOGO

DESCRIPTION: SEAFOOD LOGO Main version FILENAME: seafood_logo_NOR_pms.pdf

How much do the health benefits of seafood play into your marketing strategy?

delivered fresh by air, and enjoys a premium position with many consumers.

CC: In our marketing we talk more about the freshness, taste and joy of eating seafood than Omega-3 fatty acids and nutrition. Still, we know from our research that consumers, especially those in Asia, are quite aware of the positive aspects of eating salmon and other seafood. Health communication is therefore often a part of our total marketing communication, but more as supporting material for consumers seeking more information and recipes.

How many members make up the NSC? Do they have to apply for membership and are they vetted? In order to make some of these claims about quality and sustainability, I would think the council needs to ensure their suppliers can back it up.

Thailand is well-known for much of its locally produced seafood. Does that make it harder or easier to convince a marketplace to open up to your products? CC: High seafood consumption is more of an advantage than a disadvantage. Our salmon stands out from the “crowd” of other seafood, has high quality, is mainly

4 • NORWEGIAN SEAFOOD COUNCIL

CC: NSC is a company working on behalf of all seafood exporters in Norway. Currently there are more than 550 companies exporting a wide range of seafood from Norway and all of them contribute to NSC’s country-of-origin marketing. Our marketing plans are developed through a very close dialogue with the seafood industry to make sure that our marketing is in line with the industry.

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Norwegian: Flying soon to a des text by Eric Baker photo by Norwegian Air Shuttle (ASA)

D

on’t be surprised if Norwegian is a household name in Asia in a decade. Already the company, officially Norwegian Air Shuttle ASA, has grown exponentially in a handful of years, now the second biggest carrier in Scandinavia and the ninthlargest in Europe by passenger numbers.

Yet chief executive Bjorn Kjos has much bigger goals in mind, and as the low-cost carrier commenced long-haul services between Bangkok and Oslo this summer, the Business Review caught up with the busy boss on the airline’s plans for the future. “Norwegian is entering Asia now because the company believes it has huge growth potential. China as a market is only going to keep growing, as more workers earn higher wages. And we expect in the future a lot of the traffic flow will be from Asians coming to Europe,” said Mr Kjos. “Of course as a budget carrier, we’ve already seen some travelers from Europe on our services that want a competitively priced flight for a holiday to Asia.” Norwegian takes the same approach to branding in every country, as Mr Kjos believe people everywhere want low-priced, safe air travel. The strategy appears to be paying off in Europe, but Asia is a big gamble. Even riskier is the order for 222 aircraft Norwegian placed last year: the order is for 122 aircraft from Boeing including 100 Boeing 737 MAX8 as well 100 Airbus A320neo. The aircraft will be phased in from 2016. Is it wise to expand so quickly? “It can seem risky, because it is a huge purchase and no one can predict the future,” he said. “But in the aviation business you have to plan in advance like this. We don’t see it as risky because all our business is growing, and we believe you have to have a critical mass of jets like we plan if you want to survive the competition in the future.” Norwegian has 79 aircraft with red noses, just like Rudolph, in its stable, mostly Boeing 737s, and it ordered some of Boeing’s 787 Dreamliners as well to service its long-haul

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Thai-Norwegian Chamber of Commerce

routes to Bangkok and New York City. It expects to have the latter flying on its routes shortly, while an order of 100 Max 737 jets is slated for the third quarter of 2017. Mr Kjos, a former fighter pilot, lawyer and spy novelist, knew he would ruffle some feathers with his plan to register his long-haul jets in Ireland instead of Norway, but he said it was because of unnecessary regulations in his home country that prevent foreign air crew from flying into Norway, resting, and then flying out again with a work permit or being paid wages on the scale of locals. Of course cost is one of the reasons Norwegian hired a foreign air crew in the first place, and Mr Kjos said he saw no purpose for the regulation. Norwegian had a load factor of 96% on its new long-haul flights in the second quarter of this year, though short-haul routes through Europe are where Norwegian has built the bulk of its success. Some industry analysts are still sceptical about whether a low-cost carrier can compete in the long-haul market. For Mr Kjos, the doubt is misplaced. “If you have solid bases set up, then it’s just a matter of having the right planes and training the crew to switch from short-haul to long-haul routes,” he said. “If you can do short-haul successfully, you should be able to do long-haul. We have very modern airplanes and a strong infrastructure.” Mr Kjos added that Boeing’s GoldCare service is also likely to pare costs, because it means Boeing engineers are the ones providing the maintenance and service responsibilities. Boeing knows its planes better than anyone, and the complexity and cost servicing the jets ourselves would be too high, he said. Norwegian includes on-board WiFi in its base ticket price, and you can purchase food, drink or in-flight entertainment with your own credit-card kiosk. Several of Norwegian’s customers are cost-conscious, so they bring their own food and entertainment, just as many plan their own trips without using a travel agent these days. He pointed to Norwegian’s fully functional website as another play to fully independent travelers.


stination near you The airline also offers a premium economy cabin on long-haul flights that Mr Kjos believes will be appealing to business travelers because it is still priced lower than the business class section of its competitors. The consumer response to its long-haul routes has already been enthusiastic, and Norwegian expects to be cashpositive from its first year of operation on the routes. The company saw an increase of over 1 million passengers in the second quarter of 2013 year-on-year, while its unit cost reduced 9%, making it third in all of Europe.

Norwegian saw an increase of over 1 million passengers in the second quarter of 2013 year-onyear, while its unit cost reduced 9%, making it third in all of Europe.

The airline’s quarterly report also noted that its traffic growth of 35% for the period surpassed its capacity increase. These certainly are heady times for the Norwegian boss, especially considering the expansion the airline has planned over the next five years. But Mr Kjos seems clearheaded about the effort, confident in the notion that if the numbers play out the way his team calculated, Norwegian will soon be well-known in this part of the world.

Bjørn Kjos CEO, Norwegian

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Felicia: Inspired by northern lights by Ezra Kyrill Erker

J

ewellery manufacturer Felicia Design doesn’t sound very Norwegian but nevertheless represents core values – quality, precision, and creativity, technical quality in production and innovation in design –that are often associated with the region. And the founder of Felicia Design – as well as the new president of the Thai-Norwegian Chamber of Commerce – Vibeke Lyssand Conselvan, concedes that one of the draws for customers is her own Nordic appearance, as people associate it in her work with those same values and aesthetics.

To discuss the company’s branding concept and business model, we sat down with Paolo Conselvan at the Felicia Thailand Ltd offices. Mr Conselvan is Mrs Lyssand

Conselvan’s husband as well as Felicia Design’s marketing and communications manager. Together they oversee some 160 staff at the headquarters on Pan Road off of Sathorn. Working for the family business, which produced machinery in Italy for the jewellery industry, he met Ms Lyssand Conselvan at a jewellery exhibition in 1991. “She was my first customer,” he says. Later he arrived in Thailand again at the end of 2005, but the technical type of work that was possible in Italy was not as easy to do here, instead, he joined her efforts to produce high-quality jewellery for international customers. For the sake of this profile he describes her as a colleague, from a business perspective. “Vibeke is the mother of my kids and my wife, but professionally speaking she is a visionary,” he says.

What she lacked in experience in Asia and in the jewellery trade, Mr Conselvan says, she made up for in hard work and letting actions speak louder than words. With forbearance and resourcefulness in the face of obstacles, jewellery became her career path. It began for her with a slice of luck, when as a 19 year old working in Norway she was asked to come to Thailand to help with the production for a jewellery company. Bangkok was less ordered 25 years ago, without the Skytrain or highway routes that now make it more accessible. What she lacked in experience in Asia and in the jewellery trade, Mr Conselvan says, she made up for in hard work and letting actions speak louder than words. With forbearance and resourcefulness in the face of obstacles, jewellery became her career path.

Vibeke Lyssand Leirvåg Conselvan

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“She was strong and powerful enough to fulfil her dreams, working hard and sticking to her philosophy,” Mr Conselvan explains. “One of the main things is that people like the company not only because Vibeke is a woman and


www.feliciadesign.com

EMOTION THROUGH INNOVATION

Norwegian, but because she has two characteristics that in the jewellery market are missing in many places. She is a designer but she knows a lot about production, with extensive experience on the bench.” In her line of work, he says, hard work was crucial. “It’s an important sign when people stay with you over 20 years because they respect what you’re doing. She managed to build her reputation because of what she does, not what she says or promises.” In 1995, Felicia Design was founded, named after a friend whose name she liked the sound of. “Afterwards she realised the connection with ‘felicity’ and happiness, doing things that you like, but initially she simply liked the name,” Mr Conselvan explains. Felicia Design’s strengths that come out of this personal background include both the design creativity and the practical issues involved in production. “One thing to understand about jewellery is that even if you’re a fantastic designer it’s not always possible to produce what you design. And if you’re a very good producer doesn’t mean you have the creativity to produce the next collection. This is a gap between the design and manufacturing, and that

is what Vibeke is. She is a designer who knows a lot about production.” This includes being up to date on new trends, collections and designers. Mrs Lyssand Conselvan shows us a Swarovski catalogue for 2014. Her office is full of jewellery magazines and colour schemes in order to keep a pulse on the industry. In a field with many derivative designs it helps to know the market and the competition. What are the Norwegian aesthetic attributes that mark Felicia Design? “Not shiny,” he says. “The feeling should be natural; natural shape, clean lines, simple and stylish” Mr Conselvan states. One of Mrs Lyssand Conselvan’s great-great-grandfathers was a rosemaling painter, drawing floral details on furniture; one early collection was inspired by that heritage. Her iconic bracelet line, on the other hand, is based on the Nordic aurora, an element of which has become the symbol of the brand. The early designs are still viable now, and that longevity helps with longstanding customers as well as attracting new ones.

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One of Mrs Lyssand Conselvan’s great-great-grandfathers was a rosemaling painter, drawing floral details on furniture; one early collection was inspired by that heritage.

“Besides showing people what we can do, there’s a story behind that bracelet. The enamel glows in the dark like the aurora. The stones are topaz. The casting is in two pieces. It is our mirror, it represents what we do: high technology, high creativity, high performance in every facet of production.” In general terms, Felicia Design doesn’t have its own new collection, Mr Conselvan explains. “We’re a service company. We have collections, but we don’t push it much in advertising and marketing so we don’t curb the enthusiasm of new designers. We prefer to lift them and help them with their choices. There are so many decisions to make for the designer to have something to sell. That is Vibeke: she can help you choose this stone, not make this metal too heavy, use higher carat, design what will sell in a specific market. I’d like for her to go back to her own designs more, but she’s very good at improving those of others.” The customers they serve are generally non-Asian clients producing their own catalogue and their own style. It’s a collaborative effort to make a new collection, and critical advice can be crucial to their success Bangkok is a centre for jewellery design, and in Asia one of the most important after China and India, Mr Conselvan says. While China has improved, Felicia still has little contact with the Chinese market, although Mr Conselvan admits that some of the designs they produce might be copied there. “In the Chinese mentality they look at a good quality copy as a positive thing, whereas in the most of the world it is seen as negative. In Chinese art, that’s how you start. It measures how capable you are in making something. How do you clash with this mentality? It’s easier to do your thing in a proper way and afterwards people will judge you on what you do. We are always one step ahead that way.” Mr. Conselvan states. There are many benefits to being based in Bangkok, he says. “What we can do here is not possible to do in Europe, and not possible in countries with cheaper labour.” While recent wage increases were implemented very quickly and the company had to adjust, operating costs are still lower than in Europe, and the technical ability is high. He cites the preference of auto manufacturers for using Thailand over China. “Thailand is coming out of the stereotype of

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COPYING IS A THREAT

TO LONG-TERM EVOLUTION OF KEY TECHNOLOGIES Original Patented Product

Pirated Product

Respect patents and intellectual property ELTEK is a company designing and manufacturing power systems for telecom and other demanding industries. A key value for Eltek is technological leadership. In order to live up to this ambition we are investing heavily into R&D and have close to 200 engineers employed in Norway. The technological leadership is an important Watch the competitive advantage, which Eltek protect through patents. In the market today movie... there are many companies with little respect for patents or other intellectual www.eltek.com/rail property. rail@eltek.com

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Thai-Norwegian Chamber of Commerce


Continued from page 25 producing cheap goods with poor quality; while the cost might be higher, so too is the quality.” The ASEAN Economic Community will provide opportunities and challenges, and possible free trade agreements may lower the costs of imports. The silver and stones they use usually come from Asia, the accessories from Europe, making Bangkok a convenient base. “Bangkok is a hub; we can get something here that we need in 24 hours. Also, the quality of life is very high. There are few countries in Asia where you can find the same level. And you can take a taxi or walk at two in the morning in Bangkok and no one will bother you.” While political and infrastructure problems may be a concern again in the future, Felicia Design has a solid platform to work around and has enjoyed steady growth over the course of its history. While there are some cultural differences to working in Thailand, such as the preference of keeping face rather than admitting to not understanding an instruction, or learning from memory rather than challenging a precept – the company maintains the Nordic standards that people associate with the brand. There is also a five-step quality control process, with every item accounted for and records of who worked on what. Staff, facilities, communication and procedures – all are kept with the intention of maintaining high standards. “We have three levels of quality: from top quality, with an incredible designer, the best quality, the best result, but low quantity to mass production where the quality is high but we can produce 15,000 pieces a day.” They have a strict policy when it comes to client confidentiality, with even much of the staff unaware of what brand the jewellery will later be marked with. And if one customer has a catalogue in a specific market, Felicia won’t work with a direct rival. That preserves the integrity of the intellectual property and the manner of production. “Brand protection,

“We have three levels of quality: from top quality, with an incredible designer, the best quality, the best result, but low quantity to mass production where the quality is high but we can produce 15,000 pieces a day.” is really important for us, we have a system that works in that way.” On the Felicia Design brand, the logo of the aurora lights is continuous movement, never straight. The slogan is “emotion through innovation” which represents the unstoppable research of something new with the power of emotions, a promise that we keep in our branding. Like with many bigger companies, branding is a promise, Mr Conselvan explains. “What people think about you is important. The marketing message needs to be clear, and communication is a big part of that, a big part of every company. Branding in Europe is easier; in Asia it’s easy to be misunderstood. You need a balance between doing and thinking. The budgets for SME companies are always limited and advertising versus results are important” “We’re proud to be a company with multicultural expertise, a mix of cultural experience.”


True colours: The penguin story Thailand managing director Gunnar Thoresen on the Jotun brand text and photo by Ezra Kyrill Erker

T

here are no penguins in Norway, but there is a reason for use of the aquatic bird as the symbol of Norwegian paint giants Jotun. And while the company has a very visible presence in home paints in Thailand— with its recognizable logo, yellow with a red stripe and blue lettering on a blue background— most of Jotun’s worldwide sales come from more industrial uses, such as protecting ships and coating the concrete and steel of iconic structures such as the Eiffel Tower, Petronas Towers, Marina Bay Sands and Burj Al-Arab. Despite the vagaries of the marketplace and political upheavals in its various production bases, the company has grown to become the ninth biggest paint manufacturer in the world, with $2.6 billion in annual sales in a total market size of $80 billion.

In Thailand, billboard and hoarding advertisements and “Penguinized” sections within paints and hardware shops give it a very high profile. Jotun products have coated the interiors and exteriors of the Rajamangala and Buriram stadiums, the government complex in Chaeng Watthana, the Ministry of Defence building, Kasikorn Bank, Siriraj Hospital and a multitude of condominium high-rises, office complexes, hotels and shopping centres. While many Thais and expatriates are unaware that Jotun is a Norwegian company, among other mainly low-profile Norwegian internationals it is a branding success story. Thailand managing director Gunnar Thoresen sat down with the Review to

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talk about the operations of Jotun, its 45-year presence in Thailand and “the penguin story”. “Jotun started mainly as a marine coating company supplying paints to the whaling fleet in Norway,” Mr Thoresen says. The family-owned company formed in 1926 and has enjoyed steady growth since then, moving early into Asia and emerging markets. While it has operation bases in every continent, most of its focus is in Europe, the Middle East and Asia. “Manufacturing in Thailand started in 1968. It was a very humble beginning, and Jotun’s first manufacturer in Asia. Thailand was not so structured at that time. We had a representative in Thailand that helped us start in Samut Prakan. The facilities are in the same place but the products have changed and the market is very different.” Jotun currently operates in four main segments, Mr Thoresen explains: decorative paints, for household and interior use; protection coatings, for anti-corrosion protection for steel and industrial structures; marine coatings, for ships; and powder coatings, which includes protection for mass-produced metal articles as well as appliances such as washing machines, refrigerators and air conditioners. In decorative paints, where the competition is greatest, the company controls only 1.5 percent of market share, but is growing in powder and protective


[Jotun’s] success can be partly attributed to a strong presence in Norway, an emphasis on research and development and internationalization. Jotun’s rise as a global brand is due to its local production, with 70 companies in 40 countries. Gunnar Thoresen

coatings, and in the marine segment it enjoys 20 percent of the global market.

Myanmar, although Mr Thoresen admits that it is unlikely to be profitable for the next five or ten years.

“As you know this is a family-owned company. There is one minority shareholder but the company is still controlled by the original family. So that means the strategy can be very different from a listed company; it can be very long-term, it can be stable, and it has been for many years.”

“In the ’80s we started a lot of factories, like in Egypt, in Saudi Arabia, in Malaysian and Oman, and they took years to take off, and now they’re part of the backbone of the whole company.

The success can be partly attributed to a strong presence in Norway, an emphasis on research and development and internationalization. Jotun’s rise as a global brand is due, Mr Thoresen explains, to its local production, with 70 companies in 40 countries. “We try to ‘localize’ our presence. We try to source as much of the materials locally. In Thailand we use around 60 percent local materials.” That includes hiring local staff – the 500 in Thailand are nearly all Thai – and having a very international managerial mix. “I was in Saudi Arabia for five years from 2005; we had seven different nationalities in the management team,” he says. The Asia regional head is Singaporean and the country heads are a variety of nationalities. “In the old days all the managers were Norwegian, but it’s becoming more and more international.” Internationalization and localization have coincided with growth. The strategy has been to be early players in a market, like establishing early in Thailand. Now Jotun has begun selling and looking for an operations base in

“All the other paint companies are merging and buying but for Jotun it’s organic growth. So we can be number 9 because the others are merging. A few years ago we used to be number 20. Growth in Norway and Europe is zero. Growth has been steady in the Middle East and in Asia, but in China, the biggest market for Jotun, the new building of ships has nearly stopped. “During the Asian Financial Crisis in ’97-98 everything collapsed, especially in Thailand. The property market, the construction market, they collapsed totally. And sales along with it. Many international companies at that time withdrew or cancelled investment plans or scaled down.” Jotun, on the other hand, enjoyed a more substantial relationship with local suppliers, employees and companies that was and remains informal but based on respect and core values, Mr Thoresen says. With Scandinavian growth at a standstill and growth in Asia likely to taper off somewhat, future growth is more likely to be steady rather than spectacular. The company’s two legal entities in Thailand, in charge of separate divisions, will merge this year to streamline operations.

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Continued from page 29

“It’s organic growth” he summarizes. “If there’s a crisis in Europe we tackle that and we grow elsewhere. Every year there’s a big crisis somewhere, whether shipping in China or consumer goods in Europe or the Asian financial crisis, but we maintain a good balance.” A key to that balance, he says, is maintaining high ethical standards for how to conduct business. “In Asia it’s a little harder, but that’s why we have the compliance manual, which we adhere to. We’re not in the huge projects where corruption is a big problem.” While it’s a company that deals with chemicals, it also has a strong “green steps” philosophy, Mr Thoresen points out. Jotun was at the forefront of the industry in Europe in banning hazardous materials and phasing out lead-based products. Cutting out a tar ingredient lost the company a lot of business in Thailand, he says. Disposal is strictly regulated, and conditions at suppliers are monitored to make sure that there are no breaches such as child labour or hazardous condition and that company standards are adhered to. Suppliers that don’t comply are banned. “You can’t phase out lead products, for example, unless you have very good research and development facilities to produce alternatives which are environmentally friendly,” he adds. R&D has helped the company be a leader in technical products such as protective coatings for offshore oil and gas platforms. A new product that will come to market soon is a fire-resistant coating that will help protect structures such as high rises, office towers or offshore oil rigs in the event of fire and thus save lives. So how did the penguin come about? The Jotuns are the frozen giants of Norse mythology, foes of Thor, and the first company logos involved Thor’s hammer. This evolved into the potent Nordic symbol of a reindeer, but the company’s associations with the Antarctic whaling fleet eventually had it choose the penguin. In 1970 this logo grew to include the globe to emphasize its international credentials. The penguin, according to company literature, represents core values of loyalty, care, respect and boldness. With 41 factories on six continents, the family-owned company can survive localized hiccups as it continues to emphasize these core values, localized management and reliance on pioneering research and development, to remain a global leader in its field as well as a trailblazer as a corporate brand.

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Telenor successful telecommunicatio Glenn Mandelid Vice President Group Communications and Head of Media Relations, Telenor Group

O

n June 27 the Myanmar authorities announced that Telenor Group was a successful applicant for a nationwide telecommunications license in the country. While discussions about final terms and conditions for the license are still ongoing, Telenor Group has already started the work of establishing an operation that aims to deliver state-of-the-art mobile services that are available and affordable to all Myanmar people. On June 27 the Myanmar authorities announced that Telenor Group was a successful applicant for a nationwide telecommunications license in the country. While discussions about final terms and conditions for the license are still ongoing, Telenor Group has already started the work of establishing an operation that aims to deliver state-of-the-art mobile services that are available and affordable to all Myanmar people. It all started in January 2013 when the Myanmar authorities invited mobile operators to submit their expression of interest to participate in the license award process for two telecommunications licenses. Being one of the few remaining untapped mobile markets in the world, it came as no surprise that the opportunity to establish a mobile operation attracted a record high participation with 91 companies submitting their interest. Following an efficient and open bidding process 11 companies in the end submitted their bids on 3 June. Among them were some of the biggest mobile operators in the world. After evaluating all contributions, the Myanmar authorities announced that Telenor Group was one of two successful applicants. In a press statement following the announcement, Fredrik Baksaas, President and CEO of Telenor Group stated that Myanmar will be an important pillar in Telenor Group’s growth strategy and that the company is fully committed to responsibly leverage our group competencies to provide access to mobile communications services for the people of Myanmar” In its


l applicant for ons license in Myanmar

Petter B. Furberg, CEO Telenor Myanmar

“One of the most important ambitions for the Myanmar authorities was to make mobile services affordable and available to all the people of Myanmar. Today, there is only one mobile operator in the country, and services are very expensive.� bid, Telenor Group managed to leverage on our strong experience and understanding of Asian mobile markets and utilize this knowledge to support the key ambitions of the Myanmar Government. The project team drew on resources from different parts of the group to secure that we had the best experts prepare the different areas of our proposal. In July, Telenor Group announced its top management team for its operations in Myanmar. Petter B. Furberg was appointed CEO-Designate for Telenor Myanmar, and to support him he got an executive team that had demonstrated strong leadership capabilities in driving business and technology development in Asia. Petter Furberg has close to 15 year experience from Telenor Group, and in his previous positions he has been both Chief Marketing Officer and Chief Financial Officer in dtac. One of the most important ambitions for the Myanmar authorities was to make mobile services affordable

and available to all the people of Myanmar. Today, there is only one mobile operator in the country, and services are very expensive. Even if prices have fallen dramatically, getting a SIM card cost around USD 200 in Yangon. Telenor Myanmar has stated that it plans to sell its SIM cards for 1500 Kyats (USD 1,5) and that call rates will be at 25 Kyats per minute. To make services available the company plans to roll out a top modern mobile network with nationwide coverage within 5 years, and start selling its services 9 months after receiving the final license. The company will sell its SIM card though a distribution network of more than 70 000 points of sales, and make top-ups available in additional 95 000 shops. The company also plans to hire around 1000 employees directly and 2000 indirectly through partners and vendors. Establishing an organization that can drive these processes has been the key focus for the new management. The company plans to recruit employees in 3 stages, and in August the top 25 management positions was announced. The vacant positions have drawn a huge interest from Myanmar people living in the country, but also from Myanmar people living abroad that sees this as an opportunity to return home and participate in the development of the nation. To provide all employees with the necessary skills needed, Telenor Group will conduct extensive training programs. Experts from other Telenor companies will contribute in the early stages of operations, but over time more than 90 percent of employees will be local. The recent development in Myanmar is encouraging and there is a high level of optimism among the Myanmar people. However, there are still risks and uncertainties connected with entering into the country. The legal framework is weak but slowly falling into place. The local bureaucracy is not properly equipped to handle the increased workload that follows international investments. The infrastructure in parts of the country is nothing more than tracks and trails making it difficult to bring in necessary equipment for transmission sites. The country also continues to face challenges with ongoing ethnical conflicts and lack of transparency. However, we see a positive drive and determination in Myanmar to transform the nation, and we believe that Telenor Group can play a positive long term role in this development by providing a service that benefits the entire population and by being an advocate for a responsible and transparent business practice.

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Norway-Asia Business Summit 2 the next big event on the Cham by Anton Benzon

S

tarted in 2003 and organised by the Norwegian Business Association Singapore in co-operation with the Norwegian Ministry of Foreign Affairs, the Norway Asia Business Summit has evolved into a meeting place for Norwegian industry in the region, the support apparatus of the Norwegian government and the diplomatic missions in the region. As such it truly represents the recently revitalised “Team Norway” concept.

Started in 2003 and organised by the Norwegian Business Association Singapore in co-operation with the Norwegian Ministry of Foreign Affairs, the Norway Asia Business Summit has evolved into a meeting place for Norwegian industry in the region, the support apparatus of the Norwegian government and the diplomatic missions in the region. As such it truly represents the recently revitalised “Team Norway” concept. Other economies in the world are facing challenges while the centre of economic growth in the world is in a continuous shift in an easterly direction. Asia is and will continue to be one of the most important future export markets for Norway and Norwegian industry.

BUSINESS DELEGATION TO MYANMAR, APRIL 2013

ORWAY-ASIA

BUSINESS SUMMIT 25-29 APRIL 2014

Mark your calendar NOW! 1

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Since 2010, the Norway-Asia Business Summit has become an annual event. The two first summits were held in Shanghai (2010) and Singapore (2011) reflecting the two largest Norwegian business communities in the region. Last year’s event in Indonesia focused on one of Asia most vibrant economies with the highest potential, but also challenges, for Norwegian industry. The 2014 summit will take place in Bangkok from 25 to 27 April 2014 with an optional extension to Myanmar 27 to 29 April 2014. Chamber President Vibeke Leirvåg Conselvan reveals that the Chamber is currently in negotiations with the two best riverside hotels in Bangkok as well as hotels in Yangon concerning the conference. She states that “the aim is to create a top-notch summit focusing on opportunities for Norwegian companies in the region when ASEAN Economic Community becomes a reality in 2015 with special emphasis on Myanmar. We will also look at Asia in 2050 and how Norway can play a role in such a scenario. In addition the summit will focus on Norwegian Industry’s competiveness in


2014, mber agenda the region.” The aim is to bring interesting business leaders as well as political leaders from Norway in addition to local business leaders to speak and inspire the audience. It is expected that the new Minister of Trade and Industry from Norway will participate in the event. Speakers at the summit may be industry leaders and decision makers who inspire the audience through their experience and knowhow. Other speakers hail from academic institutions and help the participants understand global trends and the effects of these. Some speakers represent regional organisations in Asia or host country governments. Finally some speakers are government representatives from Norway who are keen to reach out to Asia and who help update the audience on the latest developments back in Norway. In addition, several highly profiled business leaders are considering the invitation to speak at next year’s summit; among them, Mr. Jørgen Ole Haslestad CEO of Yara International, Ms. Kristin Skogen Lund, CEO of The Confederation of Norwegian Enterprise (NHO); Ms. Gunn Ovesen, CEO of Innovation Norway; Professor Torger Reve from Norwegian Business School BI; Dr. Surin Pitsuwan, former Secretary General of ASEAN; Mr. Bjørn Kjos, CEO of Norwegian Air Shuttle, Europe’s third largest low cost airline, to mention a few. Vibeke says “It’s still early days and the programme will be firmed up in the coming months and posted at the newly created website www.norway-asia.com which is expected up and running in October.” Programme content

A mix between interactive workshops for the

A mix between interactive workshops for the participants and participants and business presentations is for business presentations is envisioned. Content distribution envisioned. Contentisdistribution for the the Bangkok programme envisioned as follows:

Bangkok programme is envisioned as follows AEC related subjects 10% 20%

20%

30%

20%

Myanmar related subjects Norwegian Industry (from Norway) Success Stories Norwegian Industry in Asia Official Norway

Optional Myanmar extension (Visas for Myanmar will be facilitated) • Early morning visit to Shwe Dagon Pagoda

“The aim is to create a top-notch summit focusing on opportunities for Norwegian companies in the region when ASEAN Economic Community becomes a reality in 2015 with special emphasis on Myanmar.”

A spouse programme is also in the works, both in Bangkok and in Yangon. The target audience are mainly Norwegian-related businesses in Asia and their leaders and Norwegian government representatives looking to how Asia can influence Norwegian industry in a positive direction and how they can assist Norwegian industry abroad become more competitive in a global economy. In addition Asian government representatives as stakeholders to Norwegian industry forms an important part of the audience. Leaders NORWAY-ASIA BUSINESS SUMMIT, 25-29 APRIL 2014 within Norwegian business support organisations, ambassadors and diplomatic staff from the region are also an important key to a successful event. Finally Norwegian academic institutions with a keen interest in Asia and who can deliver future business leaders to Norwegian industry as Leisure activities well as Norwegian business media are also targeted A leisure programme willrelated be put in place

accompanying thethe main events It is envisioned that summit shall inspire and strengthen • Norwegian Friday night: Hotel) industryBarbeque in the regionDinner through(Oriental sharing ideas and experiences. In addition the summit shall help build networks, • Saturday night: Evening River Cruise both in Norway and throughout the region. The summit • Sunday morning: Golf at premium course shall also be a forum to showcase how Norwegian companies • contribute SpousetoProgramme: innovation, capacity building and sustainability.•Finally, it is desirable that theat summit delivers key recThai cooking class Oriental Hotel ommendations on development and actions needed to make • Shopping Tour of Bangkok Norwegian industry more competitive in Asia. • Canal tour of Western Bangkok “For blockprogramme the dates 25-29focusing April 2014 in • now, Inplease Yangon onyour calendars. We are confident that the 2014 summit will be sightseeing and shopping top-notch with interesting subjects and speakers in addition to networking opportunities with the leaders and shakers Cost indications of Norwegian industry, both in Norway and in the region.” Vibeke says with a big smile her lips. USD 500 per • Participation Fee foronSummit

person incl. meals but not accommodation Participation Fee for Myanmar extension Thai-Norwegian Business Review USD 500 per person incl. meals but not airtransportation and accommodation

33


infinity

the history and evolution of the world the thoughts and graphic narration of children 9 to 11 years

THE EARLY LEARNING CENTRE FAMILY OF SCHOOLS THE CITY SCHOOL Ages 3-8 years 18 Soi Arkaphat, Sukhumvit Road 49/4, Bangkok 10110 Tel: (662) 381-2919, 391-5901, 712-5338 Fax: (662) 391-1334

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THE COUNTRY SCHOOL Ages 2-5 years 9/4 Moo 1, Samakee Road 20, Samakee Road T.Pasaiy, Muang Nonthaburi 11000 Tel: (662) 588-1063, 952-4147 Fax: (662) 589-4809

THE PURPLE ELEPHANT Ages 18-36 months 44 Soi 53/1, Sukhumvit Road, Bangkok 10110 Tel: (662) 662-7653, 662-7654 Fax: (662) 260-5947

CHEZ NOODLES Ages 18-36 months #61 Soi Prommitr, Sukhumvit Road 39, Bangkok 10110 Tel: (662) 662-4570, 662-4571, Fax: (662) 662-4572

inquiries@elc-bangkok.com


Smooth sailing Newcomers Trond Tønjum and Totto Befring at Wallenius Wilhilmsen Logistics describe the company’s brand of business and local expansion plans text by Ezra Kyrill Erker photos by Wallenius Wilhilmsen

O

ne company set to consolidate and expand operations in Thailand is Wallenius Wilhelmsen Logistics, a Norwegian firm with global reach in a very unique type of all-encompassing shipping, inland transport and technical services. Newcomers Trond Tønjum, in charge of regional commercial operations, and Totto Befring, head of Thailand global IT operations, spoke to the Review about the company’s current operations and expansion plans from its new base on the 15th floor of Q House on Sathon Road. As Mr Tønjum, who just arrived in Thailand in August, explains, Wallenius Wilhelmsen is the product of a 1999 merger between two major players in Scandinavian shipping, Wilhelm Wilhelmsen, in business for some 151 years, and Wallenius Lines, operating for 80 years. In the 1970s the companies expanded into shipping rolling stock, and in the past ten years have evolved into broader logistics, including technical services, inland distribution, terminal services and supply chain management. “As a group with American Shipping and Logistics and EUKOR Car Carriers Inc [of which Kia owns a 20 percent stake], we are quite dominant in our type of shipping, with 30 percent of market share globally,” Mr Tønjum explains. “We developed from ocean shipping to logistics and also operate terminals around the world.” Of USD 3 billion in 2012 revenues, around USD 2 billion was generated from ocean shipping and USD 1 billion from terminal and inland services. Over the years, operations have evolved to include a more complete logistics package. Technical services provided by the company include preparing cars and rolling stock or heavy machinery for

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long-haul shipments to dealers around the world, for example involving renovation and upgrade, repainting or upholstering, fitting of accessories and storage. Another important evolution is inland distribution, involving the distribution of cars and other stock by barge, train and, more predominantly, trucking. In Thailand the company’s 150 trucks, based out of Rayong, do a lot of distribution for GM, Ford and the Japanese manufacturers. “We want to become a holistic supplier to the vehicle industry, where we pick up cars at the factory and deliver them to the dealer, with IT solutions so you know exactly where your car is,” Mr Tønjum says. “In, say, a Ford


showroom you might have the whole product range on display. From South Africa, North America, whether you want a Ford Fiesta or a Ford Ranger, you know exactly what you are getting.” The company has been operating in Thailand, mainly for exports, for 12 years. While Japan has been an important base in the hemisphere, the regional headquarters has been in Singapore. Now with more manufacturers establishing themselves here and Thailand and the surrounding region growing fast, there is impetus to expand operations locally, regionally and internationally. Auto customers with extensive operations here include Ford, GM and the Japanese manufacturers. And while the market is rapidly evolving here, growth is also marked in Indonesia, the Philippines, as well as in Myanmar, Cambodia, Vietnam and Malaysia. While Singapore remains important, Thailand is an ideal base for expanding operations in the region.

Playing into their hands is the fact the Wallenius Wilhelmsen provides services more specialised and technically involved than normal container shipping. “Cars are an important part of what we do, but perhaps even more important is what we call rolling equipment: construction machinery, agricultural machinery, trucks. We feel that in Southeast Asia there’s huge growth there. There are established manufacturers, loyal customers that we have contracts with in many other places in the world.” Cars and rolling stock comprise 41 and 47 percent, respectively, of ocean revenue, with breakbulk providing a further 12 percent. “Breakbulk,” Mr Befring explains, “is the high-value cargo that doesn’t fit in a shipping container.” This might include power generators, for example, or machinery for infrastructure development or mining, even yachts and trains. “The

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environment on board is controlled. Vessels can take items up to 530 tonnes, which is quite unique.” Ships have multiple decks with a flexible number of levels, often climatised, with ramps. The company owns over 60 vessels, operating up to 70 including charters. “The vessels cost around three times more than the same size bulk carrier, or around USD 100 to 120 million each,” Mr Tønjum says.

Of $3 billion in 2012 revenues, around $2 billion was generated from ocean shipping and $1 billion from terminal and inland services.

EUKOR has an additional 60 vessels and American Shipping another ten, so all told the company controls 140 to 150 such vessels, or around 30 percent of the market capacity. It is a unique segment of shipping that requires a lot of capital and a lot of expertise. Cargo needs to flow in both directions. Part of the Thailand office’s responsibilities will be to provide those technical services is support of the company’s global operations. Thus the IT segment will expand gradually but substantially, to 50 people by the end of next year from the current 10. The company employs around 5,700 people worldwide. The 400 staff in Thailand include those that take cars off the hands of the GM factory in Rayong, those that operate the company’s 150 car-carrying trucks and the employees in the ports. The Bangkok office has an international contingent including Australian, Dutch and Japanese employees, among others, with a desire to hire locally for the long term. Asked if there was risk involved in expanding local operations, Mr Befring and Mr Tønjum seem to agree that the political turbulence or floods of recent years have been more an obstacle for employees living here, rather than long-term threats to business growth or stability. Mr Tønjum was recently posted in China for six years, where the export market for cars was less dynamic than it is in Thailand. The company is also known for research and development and green initiatives, such as envisaging zero emission car carriers or terminals. Last year Wallenius Wilhelmsen also

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received positive local press regarding corporate social responsibility initiatives such as monetary donations towards a Pattaya orphanage. Employees at some of the company’s European branches made contributions out of their own salaries, which the company matched, raising millions of euros for the orphanage. It is one of several long-term initiatives in the region that besides their humanitarian aims also have potential benefits for the company. With some of the children receiving university scholarships, and choosing information technology as a major, for example, the company may have a future employee pool to draw from. There is also a need for drivers and administrative staff, and it is possible some positions can be filled in the future by the underprivileged children that are benefitting from the company’s CSR initiatives today. With local expansion on the agenda, the company will need many more employees in the years ahead.


Nordea opens private banking branch in Singapore To serve the growing community of Nordic individuals in Asia, Nordea has opened a private banking branch in Singapore.

N

ordic businesses are growing in Asia and are thereby attracting more Nordic professionals to live and work in the region. The Nordic expatriates in Asia are also staying longer than they used to.

Euromoney. Nordea is the leading Nordic provider of international private banking services, and the Nordea Group is Northern Europe’s leading universal bank, with around 11 million customers, more than 1,000 branch offices and EUR 224 billion in assets under management.

Singapore is the centre for private banking in Asia, and Nordea offers private banking services to the growing community of wealthy individuals from its newly opened branch in Singapore.

Nordea is one of the leading international banks in shipping, providing a diversified range of services for that sector. We already have a dedicated team in Singapore with strong market knowledge and structuring capabilities to assist clients in several Asian countries.

Jhon Mortensen

The new branch will be headed by Eric Pedersen, who started as an analyst in the Bank’s Treasury department, and, since 2000, has worked in senior roles within Asset Management and Private Banking. “Besides our reputation for seeing things from the client’s point of view, Nordea’s financial strength and the retained AA-rating is clearly an added attraction for wealthy clients looking for a safe and reliable private banking partner,” he says.

The Singapore team is composed of experienced, senior private bankers with financial market expertise who are supported by highly qualified operational staff. In the team of account managers are Jonas Bergqvist (Swedish), Haavard Farstad (Norwegian), and Kim Osborg Nielsen (Danish).

Eric Pedersen

“Asia-Pacific is an engine of growth for the world”, says CEO Jhon Mortensen of Nordea Bank S.A. “To present the growing number of Nordic individuals in the region with the same high quality private banking service as we do in Europe, we have opened a branch in Singapore, thereby making their access to the financial markets easier, more efficient and more secure.” For five consecutive years, Nordea was named the best provider of private banking services in the Nordic & Baltic region by the international financial magazine

For further information: Eric Pedersen General Manager, Nordea Bank S.A., Singapore Branch Phone +65 65 97 10 81

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Wearnes Automotive Volvos: A safe bet for the younger generation by Eric Baker

V

olvos have always been known for one thing—safety. And while Wearnes Automotive doesn’t want to change that reputation, the largest group of Volvo dealerships in Thailand does want to appeal to a younger target audience. The introduction of Volvo’s new 60 platform, including the V60 wagon, S60 sedan and X60 SUV has been very successful in the Thai market so far, said Seah Moon Hua, the executive director at Wearnes. “We will continue to champion the safety features of Volvo because that is our core value,” said Mr Seah. “But we are also focusing on young executives who may not have kids. That is why we are rolling out our new V40 hatchback models next quarter. We now offer a range of models that are more exciting to the younger generation. They are more than just a square box; they have a wow factor.”

Wearnes doesn’t alter its branding message much for Thais, but it has taken note of Thai consumer priorities, of which interior and exterior styling is the most important. “The cars also have to come loaded with the features they want, and handling and safety are also priorities,” he said. “Volvo has continued to design safety innovations, but some involve electronics these days. We have a feature that can detect pedestrians in order to avoid collisions. Engineers have reinforced the car’s body so that it curves inward upon impact to minimize the force, which reduces the likelihood of injury. The side doors have also been reinforced.” The past few years, Volvo sales in Thailand have been growing by 30-40%, he said. And Mr Seah is optimistic about the future of Volvo in the kingdom for a number of reasons. Firstly, he expects Thailand’s economy to keep growing at a steady pace, especially as it becomes more knowledge-based. Mr Seah also feels there is much potential for growth in the premium segment. He added that he predicts the new ownership of Volvo by Chinese firms will produce a greater years, range of more exciting products.

“[In] the past few Volvo sales in Thailand have been growing by 30-40%” Seah Moon Hua

40

In fact, market research indicates some Thais are not familiar with the Volvo brand, so much of the promotional budget this year is going toward marketing activities that introduce

Remarkably, the Singapore-based Wearnes group has been in Southeast Asia for over a century. It runs four of the seven Volvo dealerships in Bangkok, and has a wide range of branches throughout the region. Wearnes trumpets this experience in its marketing message.

Thais to Volvo.

“We know our product better than anyone in Thailand,” he said. “And we know the customers that prefer Volvos as well, as we’ve been selling here for a decade. Volvos have always done well families that have kids, because of our focus on safety.”

Wearnes is also the only Volvo dealer in Thailand that offers diplomat sales, which are targeted at embassies, international organisations and non-governmental organisations. Sales in this popular segment are tax-exempt and the cars are imported directly from Sweden. Orders take four months for delivery, and several kinds of modifications can be indicated.

Thai-Norwegian Chamber of Commerce

“We also need to make sure we have a broader model mix so that we can appeal to all our customers’ needs,” said Mr Seah.


Samitivej Hospitals: Letting service speak for itself by Eric Baker

S

amitivej Hospital, one’s of Bangkok’s leading healthcare centres, takes a bold approach to branding. Management believes its services speak for themselves, so it doesn’t feel it needs to compare itself to competitors, with word-of-mouth comprising many of its customers. “We are very concerned with service,” said Dr Somsiri Sakolsatayadorn, the managing director and chief executive of Samitivej Hospital. “We want to have the best hospitality of any hospital. We believe if you feel better during your treatment, the treatment will be more successful. Modern medicine often wants to just prescribe some pills and send you on your way, but we believe in holistic care.” Indeed, Samitivej has carved a lucrative niche by offering several services that are not available at other Thai hospitals. Samitivej just opened its cardiac institute this year, which all types of non-invasive technologies to assist patients. “Arrhythmia, or an irregular heartbeat, is quite common for those over 50,” she said. “We have radio-frequency abrasion to help Dr Somsiri Sakolsatayadorn stop the irregular rhythm. We also have implants for congenital heart defects that synchronise the heart beat. There are biodegradable stents that dissolve when the vessel is strong enough to support itself, and we have an EVA machine to deal with aneurysms.”

“We also have the world’s leading authority on hepatitis on our staff. Hepatitis is an epidemic for people in Southeast Asia, and it is transmitted by blood, so if we can detect it early we can prevent its spread. Our liver and GI centre has 15 doctors as residents.” Samitivej was founded in 1979, named by former Thai prime minister, newspaper founder, and writer M.R. Kukrit

“Foreigners have always made up a significant portion of Samitivej’s patients.”

Pramoj, has three branches: Sukhumvit Soi 49, Srinakarin and Si Racha in Chon Buri province. It has three more planned: Thon Buri, on the other side of the Chao Phraya River in Bangkok, another in Chon Buri province, and an international clinic slated for Yangon, Myanmar in 2014. Other distinct services Samitivej offers include an orthopaedic surgery and sports rehab clinic. “Often times older folks don’t know what kind of exercise their body can handle besides walking and jogging,” said Dr Somsiri. “Our therapists can help with building a regimen, including for elderly with balance problems. Another advantage is that our fitness department not only rehabs you after an orthopaedic injury, we make you confident enough to return to your sport of choice. Patients often don’t trust a body part after it’s been injured, but we rebuild the body part and your psyche so that you can return to competition.” Foreigners have always made up a significant portion of Samitivej’s patients, whether it’s because of the level of

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care or its location. The original Sukhumvit branch is in the heart of the Japanese community, and that segment makes up half of its foreign patients. Foreigners comprise 40% of the hospital’s total patients, and Samitivej caters to them with a diverse array of services promoted on its website, www.samitivejhospitals.com, which is translated into eight different languages.

the amount of medicines you need to ingest,” said Dr Somsiri. “Even at Harvard and Stanford medical schools, integrative medicine is part of the curriculum. Pills can often heal a problem, but they also have side effects. I went to China a while back and watched a world-leading doctor cure patients of cancer with a mix of modern and traditional Chinese practices.”

Dr Somsiri expects an influx of Chinese patients for its fertility clinic, as the service is banned in that country and their consumer purchasing power is increasing. The hospital group also offers VO2MAX, which checks athlete’s oxygen consumption when they exercise, hair restoration services, vaccinations for expats going abroad, and acupuncture.

She added that it is normal for doctors to become hospital managers in Thailand, “because doctors don’t like to be managed, and we understand them. Besides, the doctors are the key as to whether a hospital is successful.”

On this last service, she insisted Samitivej followed a mix of modern and alternative care. “We believe in a blend of care, with both Western and Asian therapies, as acupuncture and herbs can sometimes reduce

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Thai-Norwegian Chamber of Commerce

Samitivej won a Best Employer award from Sasin Graduate business school, which Dr Somsiri credited to setting up a happy workplace, as employee reviews formed the basis of the award criteria. The hospital has also received several certifications of distinction, which all point to the institution’s international standard of care.


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ICT: Unlocking labour productivity in Thailand text and photos by Eric Baker

T

hailand has enjoyed relative success liberalising its manufacturing sector, but to avoid the middle-income trap, it needs to move to a service-oriented economy once it outgrows the labour intensive low cost manufacturing phase. The ICT sector plays a dual role in the Thai economy: both as a contributor of economic of growth on its own and as an enabler of innovation for other sectors in the economy, allowing a potential multiplier effect in the economy.

A recent seminar hosted by the Joint Foreign Chambers of Commerce in Thailand (JFCCT) and the European-ASEAN Business Centre (EABC) in Thailand took a day to examine the issue through the lens of the information and communications technology (ICT) sector. The ICT sector needs to be supported in Thailand so that it can unlock labour productivity in the service sector, said Deunden Nikomborirak, the research director for economic governance with the Thailand Development Research Institute (TDRI).

Most of Thailand’s emphasis for foreign direct investment (FDI) is on manufacturing, and low productivity growth in the service sector is dragging down economic growth, she said. The Bank of Thailand believes the country’s labour productivity needs to double from 4% to 8%, given the latest minimum wage hike to 300 baht per day. The wage hike seems to have been given without regard for labour productivity, added Dr Deunden. “Thailand has low labour productivity in part because it limits foreign equity shareholding to 49% and domestic regulations entrench the market power of incumbent operators,” she said. “This means Thailand has low quality and less advanced services, which undermines the competitiveness of export-oriented services. And services are also an input to manufacturing; these sectors do not stand alone.” Indeed, figures from the National Economic and Social Development Board (NESDB) show 44% of the labour force works in the service sector, but labour productivity has been stagnant in these fields, below 10% in every segment except real estate, which Dr Deunden said represented an outlier because prices are not tied to productivity.

Col Settapong Malisuwan

From left: Mr Nandor Von der Luehe, Col Settapong Malisuwan, Dr Deunden Nikomborirak, Mr John Svendgren, Mr Pekka

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Dr Duanden Nikomborirak


“Most of Thailand’s emphasis for foreign direct investment (FDI) is on manufacturing, and low productivity growth in the service sector is dragging down economic growth”. Although the potential benefits accrued from the planned ASEANASEAN Economic Community (AEC) could be immense, Thailand is not positioned to take advantage of them. “Thailand’s foreign investment guidelines still focus on manufacturing and industry; service is in a no man’s land,” she said. “Some 50% of Thailand’s GDP comes from services, but only 41% of its FDI is in services. Thailand only stands to realise ‘second-hand’ FDI from the AEC because of its fairly restrictive foreign investment regime, as most foreign capital flows through Singapore now. In fact, this is what happens now.” Dr Deunden insists several remedies exist for Thailand to improve its foreign investment and liberalise its service sector. The first is to relax FDI restrictions on tech transfer. “In fact, Thailand needs a whole road map for service liberalisation,” she said. “The Foreign Business Act of 1999 needs to be amended, and we need to open up more sectors to liberalisation, especially those that support manufacturing, such as banking and logistics. Other services that should be open to competition are those that are monopolistic or oligopolistic. But AEC rules have a lot of ‘flexibility’ in them, meaning you don’t necessarily have to abide by them. You can substitute a sub-sector that is not a priority for one you believe is politically sensitive. Or if none of the member countries are ready, they can just delay the measure. “There is no compliance now, as only Singapore is compliant with service liberalisation.” The ASEAN Framework Agreement on Services that Thailand signed in 2012 means that it will allow a 70% equity share to citizens of other ASEAN countries in several fields including telecom, but as of now this is not happening, said Dr Deunden.

The solution is simple on paper but will take a great amount of political willpower to achieve, she added. Thailand needs to attract FDI and technology transfers, which will boost labour productivity, which then enables higher wages, leading to better services, which improves manufacturing competitiveness. In the telecom sector, Dr Deunden recommended the country abolish the foreign dominance regulations and promote fair use rules for interconnection charges, roaming, and infrastructure sharing. In banking, she suggested the central bank’s ceiling for banking fees be abolished as well as the restriction on the number of foreign bank branches. “The Bank of Thailand should not set rates for everything, as it means there is no competition and it allows tacit collusion,” she said. “And banks not being allowed to increase their percentage of foreign ownership is a legacy of the 1997 financial crisis.” Dr Deunden added energy would be quite hard to liberalise because PTT dominates the market. But for FDI, her prescription was to lift the four-to-one rule, where four local workers must be hired for every one foreign worker for foreign companies opening a branch in Thailand. And she advised the relaxing of restrictions on the movement of professionals, noting that as AEC provisions stand now there will be no free movement of labour. She finished with a stern warning: “The Thai economic structure mimics that of less developed countries, not more developed countries.” Col Settapong Malisuwan, chairman of the National Broadcasting and Telecommunication Commission’s (NBTC) telecom committee, insisted the main role of the commission is transforming the regime from concessions to licensing. He added the NBTC is also trying to promote infrastructure sharing for small operators, as well as more mobile virtual network operators, which are wireless service providers that do not own the network infrastructure. Col Settapong said he wants a mixed licensing approach using both auctions and “beauty contests”, or comparative administrative hearings, to replace concessions.

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Continued from page 45

He said the importance of ICT to the economy can be seen by the figure that a 10% increase in broadband penetration raises annual GDP by 0.9% to 1.5%. Dr Bandid Nijathaworn, the head of the Thai Institute of Directors (IOD), pointed out that corporate governance is one prong to attract and retain foreign investment because companies feel more comfortable in environments where corruption isn’t tolerated. Though Thailand rose from the eight to the third place in the latest corporate governance rankings for Asia, this is mainly for listed companies and not public sector governance. “A very rapid rise in the levels of corruption in Thailand is why the country’s competitiveness is declining,” said Dr Bandid.

their experiences and compliance policies with others, and reach out to industry peers, suppliers and stakeholders to tell them of their stance. Some 167 Thai companies have already joined the CAC. Bob Fox, the chair of the JFCCT ICT group and the vice-chair of EABC’s ICT group, noted ASEAN only has two countries that have transformed their telecom state-owned enterprises into fully integrated competitive players: Singapore and Malaysia. He added that businesses crave regulatory certainty, which does not exist in Thailand, and the message the sector has conveyed is “foreign investment is not really welcome here”.

An IOD survey this year of 1,066 companies found 93% believe the level of corruption is high to very high, while 75% said corruption in Thailand is getting worse.

Dr Panomporn Suvannapattana, the vice-president of regulatory for dtac, said the latest survey of Thai media consumption showed the average Thai spent 70 minutes per day browsing the web, 127 minutes per day on mobile apps, and 168 hours a day watching TV.

The IOD proposes companies and government organisations join its Collective Action Coalition (CAC) and publicly announce a zero-tolerance policy for corruption, share

“What this means is whoever has the fibre-optic cable wins the game,” he said. “You must have the cable if you want to compete.”


With the compliments of

Attorneys at Law

Kamthorn, Surachet & Somsak 31st Floor, Sinn Sathorn Tower 77/131-132 Krungthonburi Road Klongtonsai, Klongsarn Bangkok 10600 Telephone: +66 (0) 2440 0288-97 Fax: +66 (0) 2440 0298-00 E-mail: kss@kss.co.th www.kss.co.th


TNCC Summer Party 2013

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Thailand’s economy Thailand’s Economy at a Glance at a glance

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4

20

2

-

0

Other bits and pieces Petrol/litre (95 E10) NOK: TH Petrol/litre (95 Octane) NOK: NO McDonald BigMac price NOK: TH McDonald BigMac price NOK: NO

5.32 15.76 13.32 40.00

Female

-2

0

2

4

Thai Consumer Price Index

Thai GDP Growth (%) 6

20.0

5

15.0

4 3

10.0

2

5.0

1 Q2/13

Q1/13

Q4/12

Q3/12

2013p

2012

-1 -2

2007 2008 2009 2010 2011 2012 2013p

0

0.0

Stock Exchange Index (SET)

Exchange Rates 7.00

1,800 1,600 1,400 1,200 1,000 800 600 400

6.50

5.50 5.00 0801 0807 0901 0907 1001 1007 1101 1107 1201 1207 1301 1307

4.50

Manufacturing Index 2000=100 200 180 160 140 120 2007 2008 2009 2010 2011 2012

100 Basic Figures: BOI. Comparisons: Wikipedia. GDP/Capita and Thai Population: Wikipedia/IMF. Thai GDP and CPI: Bank of Thailand. Quarterly GDP: NESDB. SET: Stock Exchange of Thailand. Exchange Rate THB/NOK: OANDA. Manufacturing Production Index: Thailand’s Ministry of Commerce. Bilateral Trade: Statistics Norway. Petrol and BigMac prices as of 3 September 2013

Thai-Norwegian Chamber of Commerce

THB/NOK

6.00

Bilateral trade 2012 1200 1000 800 600 400 200 0

Import 1,778 (1,394) MNOK Export 3,378 (2,352) MNOK

Chemicals Engineering Fish Pulp Other Metal Prod Food Electronics Machinery Cars Computers Others

69.9 mill 5.0 mill 10,300,000 875,000 71/76 79/83

Male

-4

Mill

Jan13 Feb13 Mar13 Apr13 May13 Jun13 Jul13

2

MY CN TH ID PH IN VN LA KH MM

6

80+ 70-74 60-64 50-54 40-44 30-34 20-24 10-14 0-4

0501 0507 0601 0607 0701 0707 0801 0807 0901 0907 1001 1007 1101 1107 1201 1207 1301 1307

2

Sources:

8

60

-5.0

Geography Geographic Area: TH 514,000 sq. km Geographic Area NO: 385,199 sq. km Highest peak TH: Doi Inthanon 2,565 m Highest peak NO: Galdhøpiggen 2,469 m Inland water areas TH: 2,230 km Inland water areas NO: 16,360 km Coastline TH: 3,219 km Coastline NO: 25,148 km Demographics Population TH: Population NO: Population Bangkok: Population Oslo: Life expectancy M/F TH: Life expectancy M/F NO:

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2011

Some comparisons

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2010

Top 10 Exp. Jan-Jun13 %/value USD bill Motor Cars and automotive 10.7%/12.06 EDP equipment 7.6%/8.7 Refined fuels 5.0%/5.7 Chemical products 4.2%/4.7 Polymers etc. 4.0%/4.6 Rubber products 3.8%/4.3 Precious stones/jewellery 3.8%/4.3 Rubber 3.6%/4.1 Iron and steel 3.3%/3.7 Machinery and parts thereof 3.0%/3.4

12

100

NO US SG KE TW

10-20% 10-15% 7% 0-35%

Thai Population 2011

120

2009

Corporate income Tax Withholding Tax Value Added Tax Personal income Tax

GDP/Capita 2012 (TUSD)

2008

Export Growth 2012 3.2% Export Growth 2013 projected 7.6% Trade Balance USD 8.3 bill Current Account Balance USD 2.7 bill International Reserves USD 181.6 bill Minimum wage (Bangkok) Baht 300/day

Mar13 Apr13 May13 Jun13 Jul13 Aug13

Basic Figures Thailand (2012)

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Getting to know the members Jon Anders Aas Haug, CEO at WebOn Group AS. TNCC Member since 2007 What most people don’t know about you? That I really don’t like flying, which is kind of a handicap with the travel distance between my offices. The wildest/weirdest thing you have done? I’m sorry; I will and cannot ever tell.

What is your biggest achievement so far? Easy question; to be a dad. When was the first time you came to Thailand? I came to Thailand the first time in the early spring of 1996. Its more than 17 years ago, and I was close to 30 years old. This is very strange since I’m just 37 now. What do you like most and least about living in Thailand? I enjoy the food, lifestyle and friendliness, and I have also got many great friends here, both expats and residents. I really don’t like jet lag, traffic jams and temperatures above 30. Where is your favourite weekend getaway in Thailand? I must answer Baan Viscaya in Naklua. It’s my wife’s family getaway; an Norwegian oasis on Wongamat Beach north of Pattaya. If you become Bangkok Mayor for one day, what will be the first thing you do? Except from the obvious, I would start full expansion of BTS and MRT, and reduce number of Taxis. Your favourite restaurant(s) in Bangkok? Too hard to decide, and too many to mention. It probably should have been fewer. The last book you’ve read? The last book I read was The Snowman by Jo Nesbø Where do you live in 10 years? I will live in my boat in Norway in the summer and somewhere warmer in the winter. ;-)

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Thai-Norwegian Chamber of Commerce


Honorary member H.E. Mrs Katja Nordgaard New Ambassador Royal Norwegian Embassy Tel: +66 (0) 2204 6500 Fax: +66 (0) 2262 0218 Email: emb.bangkok@mfa.no

Honorary member and Senior Advisor to the Board Tove Bjerkan House 101/20 Na Jomtien Soi 38, Ban Amphoe, Sattahip, Chonburi 20250 Tel: +66 (0) 3823 7683 Fax: +66 (0) 3823 7683 Email: bjerkan@loxinfo.co.th

Senior Advisor to the Board Dr. Kristian Bø 234/237 Discovery Place, Soi 23 Khlong 7, Pathun Thani, 12110 Thanyaburi Tel: +66 (0) 2957 0111 Fax: +66 (0) 2957 0222 Mob:+66 (0) 8 9129 9993 E-mail: kristbo@truemail.co.th

Mr. Gunnar Thoresen Jotun Thailand Ltd Tel: +66 (0) 3821 4450 Fax: +66 (0) 3821 4373 Email:gunnar.thoresen@jotun.com

Ms. Piyanuj (Lui) Ratprasatporn Tilleke & Gibbins International Ltd. Tel: +66 (0) 2653 5555 Fax: +66 (0) 2653 5678 Email: lui@tillekeandgibbins.com

Dr. Paisan Etitum, Ph.D Thai Transmission Industry Co., Ltd. Tel: +66 (0) 2678 6640 Fax: +66 (0) 2678 6649 Email: paisan@tti-mail.com

Mr. Gunnar Bertelsen Telenor Asia (ROH) Ltd. Tel: +66 (0) 2637 4700 Fax: +66 (0) 2637 4726 Email:gunnar.bertelsen@telenor.com

Board of Governors President Ms. Vibeke Leirvåg Felicia (Thailand) Ltd. Tel: +66 (0) 2637 6981 Fax: +66 (0) 2637 6997 Email: president@norcham.com

Vice President Major Choakdee Dhamasaroj Nera (Thailand) Ltd. Tel: +66 (0) 2664 1464 Fax: +66 (0) 2664 4002 Email: choakdee@neratel.com.sg

Vice President Mr. Axel Blom Blue Business Solutions Ltd. Tel: +66 (0) 2627 3040 Fax: +66 (0) 2627 3042 Email: axel.blom @blue.in.th

Vice President, Mr. Petter Børre Furberg Total Access Communications PLC Tel: +66 (0) 2202 8000 Fax: +66 (0) 2202 8828 Email:petterf@dtac.co.th

Bent Axelsen Yara Thailand Tel.: +66 (0) 2664 9498 Fax: +66 (0) 2664 7488 Email: bent.axelsen@yara.com

Mr. Torpong Thongcharoen Norske Skog (Thailand) Company Limited Tel.: +66 (0) 2661 3486 Fax: +66 (0) 2661 3485 Email: torpong-t@papcothai.com

Ms. Aina Eidsvik Aibel Tel.: +66 (0) 3300 4040 Fax: +66 (0) 3300 4041 Email: aina.eidsvik@aibel.com

Mr. Jon Anders Aas-Haug WebOn Tel.: +66 (0) 2206 4120 Fax: +66 (0) 2207 2525 Email: post@webon.no

Thai-Norwegian Business Review

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Melvær&Lien The Idea Entrepreneur Photo: Tom Haga

SMARTER LABELLING SOLUTIONS Skanem is one of the leading producers of self adhesive labels, with 14 labelling plants in 10 countries across Europe, Asia and Africa. Skanem Bangkok opened in June 2007 and is Skanem’s first establishment in South-East Asia.

Skanem Bangkok Co. Ltd. Amata Nakorn Industrial Estate 700/247 Moo 1 Bankao, Panthong Chonburi 20160 Thailand Tel.: +66 (0) 38 465 315-19 Fax.: +66 (0) 38 465 320-21 www.skanem.com

Bridging Societies is our business Nera Networks provides wireless transmission solutions to communication network owners in most market segments including: • Mobile • Broadcast • Enterprises and Internet Service Providers • Government and Educational institutes • Defence • Offshore and Utilities • Retail Payment Solutions Nera (Thailand) Ltd. 26th Floor, 253 Asoke Tower 253 Sukhumvit 21 (Asoke) Road Klongtoeynua, Wattana Bangkok 10110 Tel: +66 (0) 2664 1464, Fax: +66 (0) 2664 4002 www.nera.no


An Anemployer employerof ofthousands. thousands. Built Builtaround aroundequality, equality, opportunity opportunityand andpeople peoplelike like us. us. At Telenor Group, we believe that being at the forefront of At Telenor Group, we believe that being at the forefront telecommunications isn’t just about technology. It’s aboutofpeople. telecommunications isn’t just about technology. It’s about people.ask And whether those people are customers or employees, we always And whether those people are customers or employees, we always ask ourselves this simple question; ‘does this fulfill the needs of people?’ ourselves this simple question; ‘does this fulfill the needs of people?’ That’s why we have invested resources and time in developing new That’s why we have invested resources and time in developing new ways of working, creating new structures that dismantle the barriers ways of working, creating new structures that dismantle the barriers and hierarchies of the past and replace them with freedom, openness and hierarchies of the past and replace them with freedom, openness and opportunity. We know that as we have grown internationally, our and opportunity. We know that as we have grown internationally, our employees remain our most precious asset and we aim to help them realize employees remain our most precious asset and we aim to help them realize and fulfill their ambitions and potential as individuals and as groups. and fulfill their ambitions and potential as individuals and as groups. Wherever they are based. To find out more about how the Telenor Group Wherever they are based. To find out more about how the Telenor Group works hard at being ‘built around people,’ please visit www.telenor.com works hard at being ‘built around people,’ please visit www.telenor.com

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Telenor Group is aisglobal provider of of high quality telecom services Telenor Group a global provider high quality telecom serviceswith withoperations operationsinin1313markets marketsaround aroundthe theworld. world. To find out more about how we put people at the heart of our business, visit www.telenor.com To find out more about how we put people at the heart of our business, visit www.telenor.com Telenor Group hashas telecom operations in these countries: Norway, Denmark, Sweden, Telenor Group telecom operations in these countries: Norway, Denmark, Sweden, Hungary, Montenegro, Serbia, Ukraine, Russia, Pakistan, Bangladesh, Thailand, Malaysia, India. Hungary, Montenegro, Serbia, Ukraine, Russia, Pakistan, Bangladesh, Thailand, Malaysia, India.

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TNBR 2013-03 magazine  

Thai-Norwegian Business Review This issue focuses on Branding Norway, how to brand a whole nation.