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Facts about Thailand

Legacy Phuket Gazette

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Facts about Thailand | The Thaiger

BANGKOK (AFP): Thailand, which is holding general elections today, is a constitutional monarchy nominally headed by revered King Bhumibol Adulyadej. The following are key facts about Thailand: GEOSITUATION: A Southeast Asian country surrounded by the Gulf of Thailand, the Andaman Sea and Indian Ocean. Thailand borders Myanmar, Cambodia, Laos and Malaysia. POPULATION: 62.5 million. ETHNIC GROUPS: Thai/Lao 94 percent, Chinese four percent, others two percent. CAPITAL: Bangkok (population: 7.5 million). LANGUAGES: Thai (official), Chinese, Malaysian, English. RELIGIONS: Therevada Buddhism (94 percent), Muslim (four percent), Christian (0.5 percent), other (1.5 percent). HISTORY: Thailand, formerly known as Siam, is proud never to have been colonized. It has been a constitutional monarchy with a parliamentary government ever since a bloodless coup on June 24, 1932 overthrew the absolute monarchy. After a period of political instability, the reign of current King Bhumibol Adulyadej, which started in 1946 and has been the longest in royal history, ushered in an era of unprecedented economic prosperity until the Asian financial crisis in 1997. King Bhumibol has presided over more than 20 prime ministers and 16 constitutions. Seventeen coups have taken place under his rule, which has also seen Thailand transformed from an agrarian state to one of the Asia’s “tiger” economies. The king does not publicly arbitrate during times of crisis. However, during a popular uprising in May 1992 he chastized both the military and demonstration leaders to bring an end to the violence. POLITICAL INSTITUTIONS: Thailand is a constitutional monarchy with a 500-member National Assembly, and a 200-member non-party Senate. ECONOMY: Thailand’s economy doubled in size in both the 1970s and 1980s, and from 1986 to 1996 the average annual economic growth was a world record nine percent. Growth was on the same pace until the 1997 Asian financial crisis and the subsequent devaluation of the Thai baht. Thailand last year completed an IMF program aimed at solving its economic problems, but growth for 2000 is now estimated at only 4.5 percent due to rising oil prices and depreciation of the baht. Last year also saw the stock market lose 40 percent of its value (an Asian record), the baht’s fall to 44 to the dollar, a decrease in foreign investment, a flight of capital and, most disturbingly, new defaults in loan payments. Thailand’s principal industries are tourism, agriculture, textiles, cement, and tungsten. Principal products are rice, sugar cane, tapioca, corn, bananas, pineapples, rubber, shrimp, and chicken. PER CAPITA INCOME: 1,873 dollars in 2000. EXTERNAL DEBT: 82 billion dollars forecast for 2000. ARMED FORCES: Estimated at 305,000 troops, including 200,000 in the army, 62,000 in the marines, and 43,000 in the air force.



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Phuket

Red car ‘gun flasher’ arrested in Phuket

The Thaiger

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Red car ‘gun flasher’ arrested in Phuket | The Thaiger

Phuket police have arrested and are questioning the driver of a red sedan following Friday’s incident on Thepkasattri Road in Srisoonthorn where he appeared to wave a gun out of his driver’s window (video in the link below).

Manop Sangpal was tracked down by police but they’ve confirmed that Mr Manop’s ‘gun’ was just a BB gun, not a firearm.

The video of the man driving the red sedan and waving the ‘gun’ out of the driver’s window spread around social media on Friday afternoon after a driver following recorded the incident and posted it.

Read the story and see the video below…

Police hunting for driver who threatened others with a gun on Phuket road – VIDEO

On the video the red Ford sedan cuts in front of the car with the dashcam then veers to the left lane while the driver waves the gun out of his window near Wat Srisoonthorn.

Police say Mr Manop was arrested at lunchtime yesterday (Saturday) in a workers camp in Soi Sukapibal where he lives with his Burmese wife and family.

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Krabi

Tsunami advisory for Andaman Coast – all clear

The Thaiger

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Tsunami advisory for Andaman Coast – all clear | The Thaiger

An advisory was sent out last night about two earth tremors registering 5.0 and 5.2 magnitude centered on the Andaman Islands, 620 kilometres north west of Phuket.

The National Disaster Warning Centre sent out an advisory to Governors of six Andaman Coast provinces to be on alert for tsunami warnings and more earthquake activity.

There has been no tsunami activity registered along the Andaman coastlines.

Tsunami advisory for Andaman Coast - all clear | News by The Thaiger

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Bangkok

Top Five things to consider if you’re buying a condo in Thailand

The Thaiger

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Top Five things to consider if you’re buying a condo in Thailand | The Thaiger

Not quite a Top Ten but some good straight-talking about buying condominiums in Thailand from Desmond Hughes from Hughes Krupica

One of the most commonly read or spoken summary of foreign ownership of property in Thailand is along the lines of

“Foreigners can buy a foreign freehold condominium in their name”.

At this sentence, many foreign investors switch off, and assume that the rest of the detail provided by the author may be legal mumbo jumbo or a thinly veiled attempt to win their business.

In fact, there is quite a lot you should know about Thai condominiums, before you start property hunting. As my clients don’t generally spend their time reading legal journals and legislation unless they have to, I have set out a mixture of legal and practical matters below without much distinction:

1. Only 49% of the Registrable Area of a condominium can be sold to foreigners.

In Bangkok, this is not likely to have any impact on you. Most of the buyers and owners of condominiums in Bangkok are Thai nationals. Even in condominiums popular with foreigners, it is an uncommon phenomena that foreigners would ever outnumber Thais as owners in a building. You might ask why the rule even exists, but there is a fear and protectionism in many Asian countries, not just Thailand, to try and keep foreigners ‘controlled’ through numbers and perecentages.

In other places – Phuket; Pattaya; Koh Samui; Chiang Mai and Hua Hin particularly you should apply caution to ensuring that the correct ‘quota’ of foreign units is available to be sold to you on a freehold basis.

2. Banks often advertise they will give finance, even potentially to foreigners, but in the end – don’t

I speak from personal experience and from that of my clients. For my first condo investment in Bangkok, I had to take out a loan with HSBC which was then taken over by a Thai bank. My loan had to be in foreign currency, because in order to buy a foreign freehold condominium – you have to send foreign currency into Thailand from overseas to generate ‘foreign exchange transaction forms’ to register the title to a foreigner at the land office. This means a lot of hoops for a bank to jump through simply to provide a mortgage. Foreigners are also viewed as flight risks by Thai banks and they do not wish to spend their time chasing foreign assets. This all means that a very high percentage of the foreign buyer market is cash based, which is good for the stability of that part of the condo market.

If you are tempted to try and take out finance applications to banks, be aware that the banks are looking for you to have some business in Thailand; perhaps to be married to a Thai national who preferable from the bank’s perspective will have some degree of wealth for self-support; and that you have other assets in Thailand with a history of using and paying off credit such as credit cards.

3. There is an oversupply of condominiums in Bangkok at the moment and rental yields are traditionally low in terms of % compared to more expensive Asian neighbors – Hong Kong and Singapore, and further afield

A condo in a prime rentable area at a high investment price can remain rentable due to its extremely useful location and amenities. If such condo has a 24 hour supermarket in the basement of the retail area and dozens of restaurants, as a condo building I am thinking of does have such amenities, then it will remain rentable for some time if the property is maintained. However, another condo at the end of the same ‘Soi’ and post building and delivery could remain unrented after many months and even if the rent is cut to 50% of the market price. Don’t just take my word for the state of the market for condo rentals in Bangkok, ask the agents.

In addition to this, the authorities are taking a closer eye at tax declarations and ‘cracking down’ on undeclared taxes – not just personal income tax, but the ‘business tax’ of 12.5% for renting units out. This all adds to the costs of investing and renting in a condo, and you must calculate this into your budget and forecasts to avoid living in fantasy land about dream returns.

3. You won’t have any say in how the condominium is managed

Unless you buy up over half of the voting rights attached to units in the entire building, you will be a minority voice on issues like the raising of the common area fees; use of the ‘sinking fund’ – the fund to make capital repairs, changes to the rules and regulations and general maintenance decisions, even of some significance. Don’t imagine standing up at an co-owners meeting voicing your opinions and somehow making headway in ‘changing’ the direction of the management of a building. The way in which a building is managed boils down to how the developer has structured ownership, whether the developer retains many units and a large % of the voting rights or not, and whether the developer plans to self-manage or outsource management of the asset to a reputable or not-so-reputable management company.

If you don’t check the management plan then I can reference lots of analogous situations where you would take more care – if you buy a car, you should think if there are any decent repair centres nearby and at a reasonable price – Ferraris in Phuket aren’t currently easy to maintain, I would imagine, as a non-Ferrari owner and observer of the state and condition of the roads in that Province. You also wouldn’t, I hope, buy a smart phone without knowing you could have the phone service, fixed and various parts replaced on reasonably short notice. As a property is a far higher value of investment, a lot of investigation into the management plan is necessary.

4. Don’t Believe the Hype – It’s a Sequel

False Media, we don’t need it do we? If you see a glossy marketing brochure and are told that the developer ‘has to deliver on its promises by law’ – be wary. To take one example, I bought a condo under which a ‘private wine cellar area with personal secure wine bottle storage space’ would be provided to every buyer. Amazingly, without any shame at all, the famous developer constructed an unchilled cheap wooden cabinet with glass doors, no locks next to 4 sofa chairs in the open space corridor between a swimming pool and the gym. If you wanted to fry an egg on the ‘wine cabinet’ then that was highly likely to have been possible.

These kind of things are not all ‘horror stories’ – I actually got a decent condo notwithstanding the missing items. However, you will often have to compromise when in more highly regulated and supervised jurisdictions, you would not. Compromise is a very common work in Thai society and it applies to business and consumer purchases too.

5. Set up your ownership for easy re-sale

If you are buying a condo as a ‘foreigner’ and paying cash, then you can buy your condo through a foreign company, and sell the company later. This is only worth doing if the cost of setting up and maintaining the foreign company is reasonable and the company you set up is ‘saleable’ and attractive to others. You should not carry out this kind of structuring to ‘avoid tax’. However, you can set up this kind of structure, pay tax on the purchase, and subsequently deal with your company as you see fit, provided a buyer is willing to buy it. If such a company receives rental income, then even if it is foreign it is till liable to taxes as the use of the ‘immoveable property’ for generating revenue isn’t deemed to be ‘outside’ of Thailand, and that applies even if the company tries to contract for and receive the rent outside of Thailand.

Desmond Hughes has operated and owned 2 law firms in Asia in 14 years spanning Thailand; Vietnam; Indonesia with clients in all of Asia and other markets investing inwards into the region with his existing firm Hughes Krupica possessing a large market shares in its fields of expertise. 

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