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Decentralized Rural Development Planning : A Case Study of  Khok Charoen District, Lopburi Province, Thailand (Part II)
 

Decentralized Rural Development Planning : A Case Study of Khok Charoen District, Lopburi Province, Thailand (Part II)

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    Decentralized Rural Development Planning : A Case Study of  Khok Charoen District, Lopburi Province, Thailand (Part II) Decentralized Rural Development Planning : A Case Study of Khok Charoen District, Lopburi Province, Thailand (Part II) Document Transcript

    • CHAPTER IV NON-AGRICULTURAL SECTORIntroductionLop Buri province is located in the upper part of the central region of Thailand, ‘group 2’,with the region also containing other provinces such as Sra Buri, Lop Buri, Singh Buriand Chainat. It is approximately 150 kilometers north of Bangkok, covering an area of6,641.859 km2. The district under consideration in this study is Khok Charoen, in theNorth of Lop Buri province. The area is connected to Nakhon Sawan province (Tak Fadistrict and Ta Kle district), and Phetchaboon province (Sri Thep District). The non-agricultural sector consists of three major sub-sectors: industry, trade and commerce andtourism. Table 4.1 below shows the economic structure of the Lop Buri province. Hereone can see that non-agriculture sector is a very important part to the provincial economy,with industry and trade and commerce holding 36.88% and 14.11% of the provincial GPPrespectively. Tourism which is another area under consideration in this sector may bepart of ‘Others’ showed in the same table. Similarly, table 4.2 shows the absolute valuesof the income generated, segregated into different sectors; again the percentage share ofeach sector is shown. Table 4.1 General information of Lop Buri province. Population (200 5) 73 7,89 1 people Area 6,64 1.85 9 s q. m. Number of dis tricts 11 dis tricts Gros s Provincial Product (GPP) (200 4) 66 ,5 04 million baht Indus try 36 .8 8% Trade and Commerce 14 .1 1% Ag riculture 12 .5 2% Trans port 3.29 % Cons truction 3.14 % Others 30 .1 6% Average income per pers on (2 54 7) 80 ,6 25 baht Source: Provincial employment statistics (2004)Contrasting the case in provincial level, the non-agricultural sector is not a primary sectorengaged by the people of Khok Charoen district like the agricultural sector.Nevertheless, this sector has a role to play in the economic development of the district asit can still be regarded as additional employment opportunities and income for the localpeople Table 4.2 Breakdown of income generated by sector. S ector Monetary value s (million baht) S hare (% )Indus try 22,22 9 3 6.63Trade and Comme rce 8 ,2 91 1 3.66Government 7 ,5 71 1 2.47Ag riculture 7 ,4 33 1 2.25Education 2 ,9 66 4.89Cons truction 2 ,0 88 3.44Trans port 1 ,9 19 3.16Re al e s tate 1 ,6 85 2.78Electricity and water s upply 1 ,5 67 2.63Bank ing 1 ,4 19 2.34Hotel and res taurant 1 ,2 98 2.14He alth and s oc ial welfare 1 ,2 03 1.98Community, s ocial and pr iv ate s ervice 6 35 1.05Fis hery 2 12 0.35Mining 1 13 0.19Hous e maid 33 0.05Source: Provincial employment statistics ,2004 128
    • To give a picture on the employment status within Lop Buri province, one can see fromFigure 4.1 that roughly equal shares of the population are employed in agriculture andnon-agriculture, at 46%. Non-agricultural, however, comprises of many economicactivities and the breakdown of this is shown in Figure 4.2.Figure. 4.1 Employment status at provincial level. Source: Provincial Employment Statistics (2005) Others, 1.34% Public sector, 6.50% Agriculture, 45.92% Non-agriculture, 46.24%Source: Provincial Employment Statistics (2005)Figure: 4.2 Breakdown of employment by sub-sector in Lop Buri (in number of worker) Others 21180 Trans port and cargo 6,772 Government, arm y and other public services 10,079 Education 11,595 Hotel and restaurant 20,639 Construction 26,971 Wholes ale, retail, car and motorcycle repair, domes tic product 55,360 Factory production 78,795 Agriculture, hunting, and fores try 196,469 0 50,000 100,000 150,000 200,000 250,000Source: Provincial Employment Statistics (2005)Overview of non-agricultural sector in Khok Charoen districtKhok Charoen is one of the less prominent districts in the Lop Buri province whether interms of area, population, level of development or the income generate to the province. Itis well-evident that this is not the most appropriate area for the development of the non-agricultural sector; this is noticeable in the vision of the district office to develop KhokCharoen as an organic agricultural source. Nevertheless, the non-agricultural sector has arole to play in the development of the district, as well as the improving the well-being ofits people.Table 4.3 shows a comprehensive picture of non-agricultural sector in Khok Charoendistrict. In terms of industry, there is little variety in terms of type of industry and thereare very few industrial developments within the area. Tambon Yang Rak has the highestdensity per 10 km2 with 1.52. The levels of industrial development in Khok Charoen andKhok Samae San as measured by level of density are of similar scale at 1.24 and 1.42 129
    • respectively. There is only one unit of industry in Nong Makha and none in WangThong; indicating obvious areas that can be improve. Table 4.3 Comprehensive picture of Non-agricultural sector in Khok Charoen district Indicators/Tambon Khok Chareon Yang Rak Khok Samae San Wang Thong Nong Makha Area (sq. km) 72.94 65.71 42.34 25.34 110.81 Population (person) 7296.00 7783.00 3231.00 2638.00 3509.00 Number of cottage industries per 10 sq. km 1.23 1.52 1.42 0.00 0.09 Number of OTOP per 10 sq. km. 1.51 0.15 1.89 0.00 0.27 Number of market per 1000 population 0.27 0.51 0.31 0.38 0.28 Number of service and repairing units per 1000 population 5.21 0.26 1.24 0.00 7.69 Number of wholesale and retail shops per 1000 population 9.87 8.87 10.83 13.27 13.68The number of OTOP projects in Khok Charoen is of fair level. However, these OTOPprojects are clustered in 3 sub-districts in Khok Charoen and Khok Samae San, with thedensity indicator showing 1.51 and 1.89 respectively. Yang Rak and Nong Makha havelittle development in this area and again there is nothing in Wang Thong.Looking at trade and commerce, the indicators shown here are based on number ofmarket, number of service and repair units, as well as number of whole and retail shops;they are shown in terms of density per 1000 population. Here one can see that thepopulation in Yang Rak is most accessible to market places, with the market density of0.51 per 1000 population. On the other hand, although Khok Charoen is one of thelargest sub-districts in terms of population, there exists only 2 market places; hence thedensity being the lowest at 0.27. Nong Makha performs the best in our service andrepairing unit indicator with 7.69 shops per 1000 population. This is closely followed byTambon Khok Charoen with 5.21 units per 1000 population. An area of concern is WangThong where no service providers are located at all. Lastly, the number of retail andwholesale shops are most readily available in Nong Makha where there are 13.68 shopsper 1000 population. Wang Thong also performs very well in this indicator with the shopdensity of 13.27. The sub-district which performs the worst here is Yang Rak. However,this may due to the fact that it has the largest number of population. According to theoverall picture generated from these indicators, one can give an initial conclusion thatKhok Samae San is the most developed in the non-agricultural sector, followed by NongMakha, Yang Rak, Khok Charoen and Wang Thong respectively. It should be mentionedthat this is only a brief screening process to give an idea of the overall situation of thenon-agricultural sector in Khok Charoen district.In terms of tourism, it may not be too much of an exaggeration to say that this is almostunheard of in Khok Charoen district. There is no recorded number of visitors in the areaand there is no obvious existing tourist attraction. 130
    • 4.1 Industrial Sector4.1.1 General informationThe location of Lop Buri is suitable to the development of industry. Overall, Lop Burihas good level of infrastructure development in terms of road network, communication,irrigation system and power supply. It is also close to Bangkok, being around 155 kmaway. 70 per cent of the area is hilly and mountainous, commonly known for the richavailability of minerals and ores such as copper, limestone and pyrite. The other 30 percent of the lying in plain area are suitable for agricultural activities such as paddy,sugarcane, maize and cassava. According to the data from the Provincial IndustrialOffice, there are in total 583 industries in Lop Buri in 2008. The majority of industrialdevelopment in Lop Buri is in the form of agro-processing, constituting 25 per cent ofprovincial total. Other industries which are prominent in the province include: machineryand equipment (13%), food and drink (11%), non-metal (9%), transport (8%) and metal(7%). The industries which have grown the most over the last few years are agro-processing, machinery and equipment, and metal.4.1.2 Major institutions supporting industries and OTOPsTable 4.4 Summary of supporting institutions of industries and OTOPsNo Major institutions Type of support Organizations to get the support1 BOI Policy and consultancy Registered industries2 Provincial Industry Office Registered industries §Consultancy for funds (linked with different banks) §Promotion for projects3 Chambers and Commerce Office Different types of industries and §Policy support business organizations §Promotion of Industries §Consultancy for business operation §Information for business §Mediator between government and private sector4 VDF OTOPs, SMEs, other cottage industries §Fund5 Community Development Office OTOPs, SMEs, other cottage industries §Policy support §Training §Project promotion (OTOPs) §Fund6 Non-formal Education Office Occupational groups §Training7 Provincial Labour and Welfare Office Labour of different industries §Labour rights §Welfare8 Pollution Control Department Different Industries §Pollution control measures and support 131
    • • Board of Investment (BOI)Lop Buri is located in Industrial Zone 3 in the “Policies and Criteria for InvestmentPromotion” established by the Thailand’s Board of Investment. With this, come amaximum number of economic incentives allocated to different geographic zones,including: - Exemption of import duty on machinery - Corporate income tax exemption for 8 years provided that a project with capital investment of 10 million baht or more (excluding cost of land and working capital) obtains ISO 9000 or similar international standard certification within 2 years from its start-up-date, otherwise the corporate income tax exemption will be reduced by 1 year - Exemption of import duty exemption on raw or essential materials used in the manufacturing of export products for 5 years. - Deduction from net profit of 25 percent of the projects infrastructure installation or construction costs in addition to normal depreciation, and such deductions can be made from the net profit of one or several years within 10 years form the date of first revenue derived from the promoted activity -Figure: 4.3 Industrial Development and Planning Zone of ThailandSource: BOI ,2008 • Provincial Industrial OfficeThe direction of regional development in Thailand follows a top-down approach,stemming from the Office of the National Economic and Social Development Board(NESDB), then through national policies laid by ruling government before it comes downto provincial’s strategies. For the period between the years 2009-2012, the overall planfor the provinces in the upper part of the central region ‘group 2’ has put emphasis onrestructuring the process of producing safe food. The Ministry of Industry has also laid 132
    • policy on ‘1 Province 1 Agro-Industrial Product’ to be promoted in all of the 75provinces from the year 2007. In respond to this, the provincial’s strategy is to developLop Buri as the largest agro-processing industry unit among the 4 associated provinceswithin this region.The Industrial Office has three main responsibilities. First of all, it has a duty to monitor,control, support and act according legislations on industry, mining, royalty, regulation ofminerals, industrial product standard and other related laws. Secondly, it should developand cooperate with development plan to support industrial development at provinciallevel, as well as to cooperate in the implementation and evaluation of the plannedstrategy. Lastly, the PIO needs to cooperate or support the operation of other relevantorganizations. • Provincial Community Development (CD) OfficeConcerning the industrial sector, the CD office is responsible for promotion and supportof community enterprise particularly in the form of OTOP projects. Otherresponsibilities include formulating community development plan, to develop potentialsof the local population through participatory approach with the view of achieving self-sufficiency etc. • Provincial Natural Resources and Environmental OfficeThe Natural Resource and Environment Office has two major functions. First, its role isto implement waste treatment and disposal system and enhancing waste disposal capacityof local administrative authorities for environmental protection. In addition, it has theresponsibility to promote the role of private sector in research and development forenergy conservation, environmental management, recycling of raw materials and cleantechnology. However, this has not been necessary in Khok Charoen district as the poorlevel of industrial development in the area has meant that the problem of pollution isminor. • Provincial Labour and Welfare OfficeThe objectives of the Labour and Welfare Office are laid down as follow: - Promotion for the private sector to play a part in developing labour skills and expertise in order to improve the quality and skills of the labour force, - Implementation of adequate social security measures. - Promotion in the creation of a labour relation system that will provide opportunities for all sides concerned to participate in the resolution of labour problem as well as to develop and protect labours in an efficient and just manner. - Protection of Thai laborers living overseas from being exploited by employment brokers and employers. - To stipulate appropriate measures for dealing with foreign labour, taking into account the private sector’s need for labour as well as the requirements of maintaining order and internal security and the need to develop domestic labour as replacement in key areas. 133
    • 4.1.3 Current situation in Khok CharoenAccording to the data provided by the Provincial Industrial Office, the total number ofindustries in the province of Lop Buri amounts to around 600 units. The distribution ofthese industries among different districts within Lop Buri can be seen in table 4.4. Hereone can see that Khok Charoen district is the least developed with only 3 existingindustries in the area. This constitutes around 0.51% of provincial total. The sameconclusion can be reached when comparing industries in Khok Charoen to other districtsaccording to the amount of capital invested, number of workers and the productioncapacity (as measured in horsepower). From this, one can see that the combined capitalinvested in Khok Charoen district is valued at 1,170,000 baht out of the total of 8.1billion baht for the whole of Lop Buri province (0.014%). In addition, there are only 3industrial workers registered in Khok Charoen out of the total 12,115 for Lop Buri(0.025%). Lastly, the combined horsepower for industries in Khok Charoen district is 48,compare to 267,200 hp for Lop Buri (0.018%). It must be mentioned that this analysis ispurely based on the data given by the Provincial Industrial Office, whereby one mustremember that this is not necessarily a realistic practical data but rather the data used forthe purpose of registering the industry. Therefore, this may not be an unrealisticrepresentation of the industry situation within Khok Charoen. This is most noticeablewhen looking at the number of workers in which in Khok Charoen there are only 3people.To further elaborate on this, from our primary data collection from different TambonAdministrative Offices (TAOs) as well as an overview of the latest NRD2C in 2007, wehave found that there are in fact a minimum 26 industry units within Khok Charoen.These units are all rice mills. In Thailand, based on the amount of invested capital,industries are divided into three categories: cottage, small and medium, and largeindustries. Industries with invested capital of less than one million baht are classified ascottage industries, from one to one hundred million baht are small and medium industriesand more than one hundred million baht are large industries. Based on these criteria,Khok Charoen district comprises of only one type of industry: cottage industry. Inaddition, from our field visit to the area, we have found that there is at least one extrahome-based industry in Khok Charoen in the form of cassava drying field. The capitalinvested here was 10 million baht and thus it can be classified as a small to mediumindustry. It is also worth mentioning that there exists a large scale sugar factory in SriThep district of Petchaboon province which is very near to Khok Charoen and has a largeinfluence on the local population where the primary occupation is based in agriculture.Table 4.5 Industry situation in Lop Buri province Di strict Num be r of industrie s P e rce nta ge sha re Muang 194 33% Chai Badarn 96 16% Pattana Nikom 82 14% Khok Samrong 63 11% Ban M i 53 9% Tha Wung 36 6% Nong M uang 21 4% Sra Boas t 17 3% Tha Luang 13 2% Lum Sonthi 5 1% Khok Chareon 3 1%Source: Provincial Industrial Office (2008) 134
    • Table 4.6 Current situation in Khok Charoen district Type Sub-district Capital input (baht) Number of worker Horsepower Rice mill Khok Chareon 420,000 1 16 Rice mill Khok Chareon 400,000 1 16 Rice mill Khok Chareon 350,000 1 16 Total in Khok Chareon 1,170,000 3 48 Total in Lop Buri 8,110,385,130 12115 267200 % share 0.014 0.025 0.018 Source: Provincial Industrial Office (2008)Looking at the distribution of these cottage industries among different sub-districts (asshown in Figure: 4.4), one can see that the areas with the largest development of industryare Yang Rak and Khok Charoen, with the percentage share of 38 and 35 per centrespectively. 24 per cent of these industries exist within Khok Samae San. There is only1 cottage industry in Nong Makha (4%) and no industry exists in Wang Thong. Note thatthe cassava drying field which is classified as a small and medium scale industry is notincluded here; for reference it is located in Tambon Khok Charoen.Figure: 4.4 Percentage distribution of cottage industries by location/tambon 0, 0% 6, 23% 9, 35% Khok Chareon Yang Rak Nong Makha 1, 4% Khok Samae San Wang Thong 10, 38%Since all of the industries mentioned (rice mills) can be classified as agro-processingindustries, it is interesting to relate this to the number of households partakingagricultural activities; this is shown in table 4.4. Since Wang Thong has no industry at all,it has been excluded from this analysis. Nevertheless, a conclusion can be reached herethat Khok Samae San is the most advanced with 58 households to one industry. This isfollowed by Yang Rak, Khok Charoen and Nong Makha respectively.Table 4.7 Number of agricultural household per one agro-processing industry Indicator/ Number of household Number of agro-processing Number of household Sub-district working in agricultural sector agro-processing industrt per one industryKhok Chareon 844 9 94Yang Rak 647 10 65Nong Makha 191 1 191Khok Samae San 345 6 58Wang Thong 391 0 NA 135
    • Figure: 4.5 Distribution of cottage industries (rice mills) 136
    • 4.1.4 Rural Industry - OTOPKhok Charoen district relies heavily on agricultural sector providing primary occupation.However, local people have indigenous skills and other trained skills by localgovernment agencies which can be utilized in the non-agricultural sector to create moreemployment and income. The target group is mostly females who are willing to take anadditional employment to support their work in the agricultural sector. Because of theavailability of raw materials and skilled labour, the Royal Thai Government (RTG)introduced a program called “One Tambon One Product” (OTOP).OTOP program was adopted from the One Village One Product (OTOP) movement inOita Prefecture, Japan. The scheme has an objective of mobilizing local resources toproduce local products which can be sold both domestically and internationally. TheRTG used this program as a framework for OTOP and has been promoting localindustries through the manufacturing of attractive specialised products based on theabundant native culture, tradition and nature. The target administrative unit is as thename suggested, at Tambon or sub-district level. The specific objectives of OTOP arelaid out as follow: § To construct a comprehensive database system to accommodate necessary information from every Tambon in Thailand § To promote local Thai products from every Tambon, and to facilitate the buy-and- sell procedure. § To bring internet and other information technology to villages. § To encourage and promote tourism in Thailand to Tambon level and consequently raising income of the local community. § To encourage rural people to exchange information, ideas and improve communication level across various Tambons.In 2006, there are in 450 OTOP projects in the province of Lop Buri. The majority ofthese projects are located in Muang district, accounting for 24 per cent. This is followedby Ban Mi, Tha Wung, Chai Badarn, Khok Samrong, Nong Muang with 14, 11, 10, 9 and8 per cent respectively. There are 24 OTOP projects currently in Khok Charoen districtaccounting 5 per cent of total in Lop Buri. In terms of number of OTOP projects, KhokCharoen is ranked at 8 out of 11 districts in Lop Buri; this is illustrated in Figure: 4.6.Figure: 4.6 Distribution of OTOPs among different districts. Source: Provincial CD office (2006) 17, 4% Muang 19, 4% Ban Mi 24, 5% Pattana Nicom 16, 4% 108, 24% Tha Wung 43, 10% Khok Samrong Nong Muang 36, 8% 65, 14% Chai Badarn 39, 9% 33, 7% Sra Boast 50, 11% Khok Chareon Tha Luang Lum Sonthi 137
    • Comparing the statistics on the number of OTOP projects within Khok Charoen districtbetween the years 2005 and 2006, it is worrying to see the number has only increased byone unit; this is 4.17 per cent increase. It must also be mentioned that, with the exceptionof Pattana Nicom whereby the number of OTOP has actually dropped by 21.21 per cent,Khok Charoen district has seen the small percentage of growth in the amount of OTOPprojects. In this regards, Khok Charoen is rank 8 (2006) as compared to 6 in 2005. Table 4.8 Change in number of OTOP projects in different districts between 2006-07 Number of OTOPS Percentage District 2006 2007 changeMuang 67 108 37.96%Ban Mi 45 65 30.77%Pattana Nicom 40 33 -21.21%Tha Wung 23 50 54.00%Khok Samrong 17 39 56.41%Nong Muang 28 36 22.22%Chai Badarn 35 43 18.60%Sra Boast 13 16 18.75%Khok Chareon 23 24 4.17%Tha Luang 13 19 31.58%Lum Sonthi 11 17 35.29% Total 315 450 30.00%Source: Provincial CD office ,2007The degrading situation of OTOP projects in Khok Charoen can be emphasise whenanalyzing the amount income generated from these projects within the area. Over theperiod of 3 years from 2005-2007, Khok Charoen has experienced a steady decline interms of the income generated from products; reducing from 15,726,039 baht in 2005 to14,249,451 baht in 2007. In fact, Khok Charoen is one of only three districts in Lop Buriwhich have experienced a decline in income generate from OTOPs. Overall, the incomegenerated from Khok Charoen in these products is quite low relative to other districts(rank at 7 out of 11). This is quite worrying considering the quality of the products inKhok Charoen. Looking at table 4.7, it should be raised that Khok Charoen is onlysecond to Ban Mi district in terms of the amount of OTOP with 5 stars success status,with 4 products being qualified. Similarly, in terms of products with 4 stars, KhokCharoen is rank at third place with only less number of quality products than Muang andBan Mi districts. 138
    • Table 4.9 Comparison of income generated from OTOPs among different districts Amount of income generated from OTOP projects (baht) Percentage change District 2005 2006 2007 2006-2007Muang 88,269,444 110,476,363 142,949,965 22.72%Ban Mi 242,917,542 294,608,560 161,463,200 -82.46%Pattana Nicom 6,969,590 8,632,680 11,190,774 22.86%Tha Wung 25,585,100 55,980,550 86,840,950 35.54%Khok Samrong 18,393,857 21,645,008 28,871,661 25.03%Nong Muang 26,894,845 31,809,323 34,376,500 7.47%Chai Badarn 108,679,900 159,701,800 183,552,130 12.99%Sra Boast 10,803,870 11,719,200 12,185,850 3.83%Lum Sonthi 4,510,211 6,109,764 6,739,000 9.34%Tha Luang 4,552,964 5,594,476 3,535,746 -58.23%Khok Chareon 15,726,039 15,289,373 14,249,451 -7.30% Total 553,303,362 721,567,097 685,955,227 -5.19%Source: Provincial CD office,2007Table 4.10 Comparison of successful OTOPs (4 stars or more) in different districts ofLop Buri Success status Total District 4 Star 5 StarMuang 13 3 16Ban Mi 11 8 19Pattana Nicom 5 - 5Tha Wung 3 - 3Khok Samrong 4 - 4Nong Muang 6 - 6Chai Badarn 4 - 4Sra Boast 2 - 2Lum Sonthi 2 - 2Tha Luang 1 - 1Khok Chareon 6 4 10Total 57 15 72Source: Provincial CD office, 2007 139
    • Table 4.11 List of OTOPs in Khok Charoen districtSl. No. Tambon Village no. OTOPs product Registered groups 1 Khok Chareon 5 Mudmee clothing product Weaving group of Khok Chareon 2 7 Mudmee clothing product Social welfare housewives group 3 6 Weaving mudmee product Weaving group of Khok Chareon 4 4 Mudmee clothing product Thai cloth weaving network v.4 of Tambon Khok Chareon 5 9 Mudmee clothing product Thai cloth weaving network v.9 of Tambon Khok Chareon 6 4 Mudmee clothing product Thai cloth weaving network v. 4 of Tambon Khok Chareon 7 4 Mudmee clothing product OTOP artists centre 8 6 Mudmee clothing product Indegenous Knowledge Development centre 9 6 Mudmee clothing product Forward Vocational Leadger group 10 6 Processed clothings from mudmee Industry group 11 1 Domestic odour product Charcoal processing group 12 Khok Samae San 1 Mudmee cloth product Thai cloth weaving network v. 1 of Tambon Khok Samae San 13 3 Mudmee cloth product Thai cloth weaving network v. 3 of Tambon Khok Samae San 14 5 Mudmee cloth product Thai cloth weaving network v. 5 of Tambon Khok Samae San 16 6 Mudmee cloth product Thai cloth weaving network v. 6 of Tambon Khok Samae San 17 8 Broom making group Broom making group 18 3 Basketry Basketry group of Bang Muang 19 1 Wooden chair Private cooperative group Suan Pa of Lop Buri 20 Nong Makha 8 Thai dessert Agricultural house wives group of Tambon Nong Makha 21 8 Mudmee clothing product Thai cloth weaving network v. 8 of Tambon Nong Makha 22 8 Mudmee clothing product Thai cloth weaving network v. 8 of Tambon Nong Makha 23 Yang Rak 2 Mudmee clothing pattern Thai cloth weaving network v. 12 of Tambon Yang RakSource: Provincial CD office (2005).* Note there is one extra OTOP product started by an individual in 2006 but data is not known.Analysing the distribution of OTOPs among different sub-districts, one can see that theseprojects are clustered in two Tambons, namely, Khok Charoen and Khok Samae San.Tambon Khok Charoen has the highest number of OTOPs with 11 units, accounting for48 per cent of district total. This is closely followed by Tambon Khok Samae San with 8projects (35%). Nong Makha and Yang Rak have few OTOP projects with 14 and 4 percent respectively. It should also be mentioned that there are no OTOP project in TambonWang Thong.Furthermore, there are only three categories of OTOP projects in Khok Charoen district.It can be pointed out that the overwhelmed majority of these projects are in the form ofcloths and fabric (18 projects, 79%). This is unsurprising as the district is well known forits weaving products. Domestic products such as basketry, broom production also hold asmall percentage of 17 per cent, with 4 projects in this sector. In food sector, only Thong 140
    • Muan production in Nong Makha comes from Khok Charoen district. This accounts for 4 per cent of the total. Again the majority of weaving projects are clustered in Khok Charoen. Khok Samae San, however, is the most diverse in terms of different OTOP projects in the area. Figure: 4.7 Distribution of OTOPs by location/Tambon 12 11 N ber of O P groups 10 8 8 TO 6 4 3 um 2 1 0 0 Khok Chareon Khok Samae Nong Makha Yang Rak W ang Thong San Tambon Figure: 4.8 Distribution of OTOPs by function among Tambon12 1010 Domestic8 product, 4, 17% Food, 1, 4% Food6 5 Cloths and fabric Domestic product4 3 22 1 1 1 Cloths and fabric, 18, 79%0 Khok Chareon Yang Rak Nong Makha Khok Samae Wang Thong San 141
    • Figure: 4.9 Distribution of OTOPs by function among different areas within Khok Charoen district 142
    • 4.1.5 Comparison among Case StudiesDuring the reconnaissance survey and the sectoral field study, 7 different units ofindustry were interviewed. This consists of 3 OTOP projects, 2 home-based factories, 1small occupational group enterprise and one large sugar factory in a nearby province.The purpose of these case studies is to gain an insight as to how the different industriesare operate and the successfulness of such operations in order to identify the problems aswell as establishing the potentials within this sub-sector. The analysis on sugar canefactory will be based on the influence that this factory has on the population of KhokCharoen. This analysis will consequently be used as a basis for project proposal to beconsidered for implementation by the district.Case Studies of OTOPsThe three OTOP groups used as case studies are all community- based OTOP groups. Acommunity-based OTOP group refers to a group of local people who are partaking in asmall local group enterprise by utilizing their common interests and skills in particulartypes of products. Generally speaking, these groups are form to provide opportunities togain additional income from their primary occupation in agricultural sector which may beturbulent due to a number of factors such as draught, low price of agricultural products.The OTOP groups get support from a number of public organizations such as BAAC,Community Development Office, Royal Thailand Government, and TambonAdministration Office to setup projects. Additional capital has to be raise from groupmembers by selling enterprise’s shares and the income earned is distributed to eachmember according to the number of share purchase.These OTOP groups under consideration are weaving group in Tambon Khok Charoen,weaving group in Tambon Khok Samae San, and Thai dessert (Thong Muan) productionin Tambon Nong Makha. • Thai Hand Weaving Group, Tambon Khok CharoenLike a large proportion of people in the district, people in village number 4 of TambonKhok Charoen are originally from the Northeastern part of Thailand, where theindigenous skills in weaving and traditional mudmee clothing are renowned. The groupwas formed in 1995 and became active during the period of 1996-1998 whereby draughtcaused heavy loss of agricultural products. This led to a revival of weaving skills to beused as a supplementary source of income to the local people.A number of organizations have helped the group by providing financial support as wellas providing ranges of technical and skill trainings. The relevant organizations involvedinclude District office, Community Development office, Thammasart University,Provincial Trade and Commerce Office. In addition, the main player who organized thisactivity is Mr Winai Patchim, a local school teacher. He has contributed tremendoussupport to the group by, for example, providing new patterns, teaching additional 143
    • weaving skills as well as setting up a community learning centre to teach school childrenon batik painting.The group’s major products are silk based items such as hand woven cloths withindigenous designs and various patterns mudmee products. There are also cotton baseditems available such as cotton mudmee, artificial mudmee, plained color and ‘Pakaoma’.Besides, they also produce other products like note pad holder, glass holder as well as anumber of other domestic products. The hand woven products of the group have received5 stars award recognition and the products are said to be of the highest quality products inLop Buri Province.As to weaving products, the group can make 125 clothing items per month of the size 4by 0.9 meter (3.6 m2). On average 5 hours per day is spent on weaving. Total cost ofproduction is 45,000 Baht which recovers all costs including raw materials, transportationand marketing. Rough estimate on the cost of production is 360 baht per item. The saleprice is 850 Baht per item but price may fluctuate depending on different pattern and rawmaterial. From this, total income can be estimated at 106,250 Baht per month and theaverage income from weaving activities per person is 2,450 Baht per month.The group sells their weaving products to district and external markets such as othernearby provinces and Bangkok. The ratio of quantity they sell in district and in externalmarket is around 10 and 90 per cent respectively. Three years ago, middle man suppliedraw materials and bought products produced by the groups. Now the group purchases theraw materials by themselves and either directly sells their products to the wholesalebuyers or occasionally join government and private-run exhibitions.The main problem of this OTOP group is they are lack of market information,entrepreneurial skills and market linkages. This causes limited access to markets and lowsales volume. Besides, they have low production because they do not have adequatecapital to run their business. In addition, most adult villagers do not participate inweaving activities and they go to find job in Bangkok. This group needs market orientedorganization structure to promote market and network building because they do not haveanyone to take role and responsibilities in marketing channel.In summary, weaving has high potential for generating supplementary source of incometo local population. Stronger marketing networks for hand woven products should beexplored. However, further market networks must be explored and variation of patternsand designs of silk and cotton-based mudmee should be enhanced to capture wideraudiences. If this is successfully implemented, weaving activities can be seen as a long-term occupation for the local people as the skills can be pass on to youth and children tobecome next generation hand weaving entrepreneurs. 144
    • • Thai hand weaving group, Tambon Khok Samae SanThe weaving group in village number 5 of Tambon Khok Samae San was established in1994 with an initial investment of 430,000 Baht. The majority of the funding wasprovided by the Khok Samae San Tambon Administration Office (TAO) with 400,000baht and the other 30,000 baht was given in the form of weaving equipment by localMember of Parliament, Mr. Chaowat Sudlapa. The CD office also lend support in termsof trainings, providing new patterns and colors, as well as organizing and managing thegroup.Initially, Ms. Kamnun Somsin took responsibility in leading the group and activelypromoting the weaving products to the outside markets. Her influence extended beyondKhok Samae San to other weaving groups in initiating new patterns as well as purchasingthe products from them to be sold to outsiders. There were 30 members in this weavinggroup during Ms. Somsin’s time in leadership. However, there are only 10 members atpresent since she passed away.The products from this weaving group are similar to those produce by the group in KhokCharoen. It has also received 5 stars award for their quality of their product. However,since there are only few members now, the group can only produce around 2 items perday. This means the income generated from this is quite low with an average incomefrom group member being around 2000 per month for each member. This has droppedsignificantly from the period led by Ms. Somsin whereby each member received around4000-4500 baht per month.At present, this weaving group acquire raw materials from middlemen come and the endproducts are also purchased by the same people. Thus there is no other market channel.The feeling we get from the group is that since there is no leadership role, the group lacksorganization and management skills. Consequently they seem to have become more of alabour force for these middlemen rather than group entrepreneur themselves. Figure: 4.10 Marketing channels for weaving products. Source: Interview of weaving groups ,2008 145
    • • Thong Muan production, Tambon Nong MakhaThong Muan production is in village number 8 of Tambon Nong Makha. This is aproject initiated in 1999 by the Food Processing Cooperative; it is called Ruam JaiSamakhee Thongmuan (‘Souls Unity Thongmuan’). At the beginning phrase, the grouphad 20 members. The rationale behind the project is that farmers who live in this villagedepend largely on agricultural production as the main economic activities. After thecropping and harvest season, farmers are free from work and most of them migrate toBangkok in search for employment. Therefore, the head of the group discussed togetherwith the agriculture officers to get additional income for local people after the harvestseason and solution was to use Thong Muan production. This was seen appropriate asraw materials such as cassava, coconuts can be found locally.In the procedure of setting up the group, first of all, Agriculture Extension Officerstrained the group members on the production process: design, taste, and packaging. Allof them contributed 50 Baht each to contribute to purchasing equipments. The moneycollected admittedly was not enough and thus the loan was made from the BAAC in anamount of 50,000 Baht without collateral, but group guarantee.In 2004, the group was separated from Ruom Jai Samakkhee group and they registered asthe Group Enterprise where 11 members were included. Nowadays, the group has 25members. There are 5 to 7 permanent workers and they work in daily rotation. Full-timeworkers can earn 4,000 to 5,000 Baht per month while part-time workers earn 3,000 Bahtper month.The raw materials needed are coconut, sesame (both can be obtained within Tambon),rice powder, cassava powder and sugar are purchased from provincial market. OnlyThong Muan can be considered as an OTOP product but the group also produces anotherThai dessert called ‘Khrong Khraeng’. Overall, the group can produce around 700 to 800small packs of both Thong Muan and Khrong Khraeng combined. One big pack consistsof 6 small packs; the big pack can be sold to retailers at 24 baht per pack. The retailerscan then sell the product at 25 baht per pack. The main market of the groups is within theprovince and neighboring provinces. The products are sold within Tambon KhokCharoen and Nong Makha in Lop Buri province, and also to Srithep district andVangphikoon district in Phetchaboon province, as well as to Nongphai district inNakhonsavan province. The group has a plan to export their products to other countries,but the product quality is not yet accredited officially due to poor productionenvironment.The group has experienced problems in production largely due to inflating price of rawmaterials and transportation cost. According to the head of the group, the cost ofproduction and transportation has doubled in comparison to the initial period. Inaddition, the group has a plan to build a new processing house in order to increaseproduction volume and improve working environment and quality, pending on a loanapproval from TAO and Happiness and Green Society project. Other problems includedifficulties in production process in terms of skills involved in mixing ingredients and 146
    • rolling Thong Muan; in fact only 5% of the trainees can succeed after training accordingto the head of the group.Lastly, the group has potential as they can expand the volume of production andmarketing channel depending on the market need. Beside this, since Thong Muan is anOTOP product it has potential to be accredited by Food and Medical Agency forexporting.In conclusion, focus is needed on reducing the cost of production. The group also need toimprove on designing and packaging techniques to make the products more marketablee.g. inclusion of nice labeling, food nutrients etc. In addition, to expand its market thegroup needs to improve on the overall working environment and condition includingcleanliness, safety and pollution free in order to get quality control assurance.Figure: 4.11 Marketing channels of Thong Muan production.Source: Interview with group member (2008) 147
    • Table 4.12 Comparison among OTOPsCriteria for Weaving group Weaving group Thai dessert (Thong Muan)Comparison of Tambon Khok Chareon Tambon Khok Samae San production Tambon NongMakhaOTOPs 1995 1996 2004Invested Capital N/A 430,000 Baht 50,000 BahtSources of Capital The Royal Thailand Government - Tambon administration office BAAC (50000 baht) (capital) (400,000) - Local politician (weaving materials worth 30,000 baht)No. of 25 members (supplementary 30 members à down to 10 -25 membersMembers/Labour income generation) members (supplementary income (5 to 7 permanent workers, the rest used generation) this as supplementary income generation)Outputs of All year round, depends on order. All year round, depends on order. All year roundproduction Max. production: Max. production: 700 to 800 smallIncome 125 items per month Max. production: packets per day Average income: 60 items per month Average income: - 61,250 baht per month for group Average income: - 24000 baht per month per group - 2450 baht per month per - 20000 baht per month per group - 4000-5000 baht per month per member - 2000 baht per month per member member (full-time) (previously members can earn 4000- - 3000 baht per month per member 5000 Baht per month) (part-time)Market network Source: Provincial market Source: provided by middlemen Source: a combination of local and Sales: Sales: provincial market - 10% are sold to district - Middlemen Sales: - 90% are sold to external market - Within district (other provinces and Bangkok) - Phetchaboon province - Nakhonsavan ProvinceSuccess (status) 5 Star (2006) 5 Star (2006) 46 points (2005)Problems Market problem Market problem Production -lack of market information -Lack of market linkage -high input and transportation cost -lack of skills for market No Leadership Role Capital linkages - Group becoming more of a -waiting for loan from TAO Access to finance labour force for middlemen Human Resource -lack of capital rather than entrepreneur -only 5 % of trainees can succeed Human Resources Access to finance in rolling product nicely - low involvement of adults -lack of funding Quality accreditation villagers Reduction in income -Low quality to export to Skills and Technology neighboring country -low of entrepreneurs skill -limited products diversification Organization and Management -lack of market-oriented organization structureFor Potentials •Good quality •Good quality •Expand the volume of production •Skills can be pass to younger •Skills can be pass to younger depend on market need generation generation •Expand market to other districts, •Community learning and OTOP •Purchasing of raw materials provinces and neighboring centre can be develop through other sources countries •Promotion of cultural tourism •Can be accredited by Food and Medical Agency for exporting as assigned by OTOP •Poor production environment (problem with quality certification) 148
    • Analysis on OTOP projects: Overall, one can see that all OTOP projects requiredexternal source of funding. All groups are experiencing financial problem to someextent. In the cases of weaving groups, this may be due to poor management skills andlack of entrepreneurship. These OTOP projects are mainly used as channels for acquiringadditional income from the primary occupation in agriculture. Only Thong Muanproduction has some members working full-time. Weaving products in Khok Charoenare renowned for their high quality (5 stars) but they cannot generate a significant level ofincome for members. The main problem here is lack of marketing channels. Theweaving group in Khok Samae San, for example, relies on middlemen in both obtainingraw materials and selling their products. On the other hand, although Thong Muanproduction is of lower quality, it can generate greater income due to more proactivemarketing strategies. In the two weaving groups, although the quality of products is ofsimilar levels, the marketing channels in both cases are very different. One may interpretthis as lack of cooperation among different weaving groups. With cooperation, differentgroups can learn from each other experiences as well as being able to achieve greatermarket power through bulk buying of raw materials as for example. The loss leadershiprole of weaving group in Khok Samae San also contributed to a rapid decline of thebusiness operation.Analysis of small occupational group enterprise • Basketry group – Wang ThongThis is a project initiated by Wang Thong TAO in 2006, where all nine villages in theTambon are involved. It can be categorized as a cottage industry, but it is not an OTOPproduct. Currently, there are around 30 members, all of which are females and they usedthis as an opportunity to earn additional income to their primary employment in theagricultural sector. In fact, there are very few full-time workers in the group.The supporting institutions involved include Community Development office and Non-formal Education office. TAO and Community development office provide financialsupport whereas non-formal education office provides classes for making basketry.These classes normally go on for 15 days, after which the participants are capable ofproducing the baskets (although experience is needed to make the products sellable).Basketry products here are handmade in all processes. The raw materials used are hempand either bamboo or simple metal structure; all of which can be purchased from theprovincial markets. Nowadays, metal structures are preferred to bamboos as the basketsmade from them can demand higher monetary value. In one month, around 5-6 basketscan be produced per person, assuming that the partaker works around 7-8 hours per day.Each day, normally around 15-20 people turn up. For one basket, the cost of rawmaterials is 170 baht if metal structure is used and 150 baht if bamboo is used (100 bahtof hemp is used for one basket), but the basket can be sold at 350 baht a piece. 149
    • Although this may sound like a good price, lack of marketing channel has meant thatgroup’s income is small. In fact, total production per year is around 200 items per year;this is on average 17 pieces per month. From this, we can estimate the monthly incometo be at 5,950 baht per month (350 × 17) and thus total monthly profit is estimated at3,060 baht per month (5,950 – (17 × 170)). This level of profit earn is noticeably low andit is then distributed among group members depending on the amount of time they spendworking. On average, a regular worker will earn only around 300 baht per month. Asmentioned, there is a problem with marketing channel, with all the products being sold tomiddlemen (normally from Tambon Khok Charoen) or to rare visitors in the area.The conclusion can be reached that there are some potentials in Wang Thong for basketryproduction. The price of each handicraft is quite high, indicating the quality of theproduct. Therefore, it may be possible to develop this as an OTOP project; the first onein the sub-district! From interviews, we have found that the level of production can beincreased since people are generally interested to join the group if there are greatereconomic incentives; the problem is there is no market to sell these products to. This is akey problem that must be tackled for further development.Figure: 4.12 Marketing channels for handicraft basketry. Source: Interview with group membersAnalysis on case studies of home-based industriesIn this section, a small rice mill and cassava drying field are used as case studies toanalyse the problems and potentials of home-based industries in Khok Charoen district.Both of these units can be regarded as agro-processing industries. Rice mill cancategorised as cottage industry with the initial investment of less than 1 million baht.Dried cassava production, on the other hand, can be seen as a small to medium scaleindustry as the capital invested here is quite high at 10 million baht. The number oflabour needed is fairly small in both cases and the raw materials used in them are readilyavailable within local area. In the case of cassava drying field, the extra productioncapacity can accommodate more raw materials from nearby provinces. There is alsoconstant demand for these products but the profitability is based on the market price asthere is a lot of supply for these homogenous goods. Minor environmental problemsoccur in these industries in terms of smell, noise and dust. Overall, there is generally noproblem in these small home-based industries, thus it is reasonable to say that there isgood potential for further development in Khok Charoen district. Source of funding may 150
    • however be crucial here as the area is fairly backward in terms of level of income; notmany people will have the kind of money to set up these industries. Figure: 4.13 Marketing channels of dried cassava. Source: Interview with owner, 2008Figure: 4.14 Marketing channels of products from rice mill.Source: Interview with owner ,2008 151
    • Influence of nearby large scale industry on the population in Khok Charoen • Thai Rung Reung sugar factoryThis factory is one of the seven sugar factories owned by the Thai Rung Reung group.The company was originally established in 1958 but this particular factory started in1996. Although this factory is not based in Lop Buri province, the district of Sri Thepwhere this factory is located is actually nearer to Khok Charoen district (17 km) thanthose in Lop Buri itself.From the criteria mentioned in the introduction, this factory can be regarded as a largescale factory i.e. more than 100 million baht was invested here. The exact detail on thecapital invested is confidential. Total factory area is 1800 rais; this consists officebuilding, machinery building, technicians building and cargo building. There is also anexperimental field of 100 rais which is used for testing different breeds of sugar cane, soiland chemical.The factory has 27000 rais of ‘support’ area within 50 km radius of the factory. Thesupport area means that the farmers in the area are contractually obliged to sell theirproducts to the factory every year. The going rate is that for 10 rais of farmland, thefarmers will have to provide 100 tons of sugar cane to the factory per year. 3000 farmersare part of this program; it is not known how many of these farmers are from KhokCharoen. The factory gives assistance to the farmers in the support area, in terms offinancial credit/loan. If it is to a new farmer (i.e. no machines, experience etc.), thefarmer needs around 5500-6000 baht/rai, here the factory will help around 4000 baht/rai.If it is for existing farmer, the factory will help around 2000 baht/rai. The condition isthat the money has to be paid back by the end of the next harvesting period. The goinginterest rate for loan is 7 per cent per annumDuring the harvest period, the factory purchases around 25000 tons of sugar cane per day.This is 1300 trucks per day, each truck bringing 22-25 tons. Broadly speaking, around 10types of sugar cane breed are brought to the factory. However, 95 per cent of sugar caneis of K84-200 breed. This is a genetically-modified breed (invented Agriculture ResearchCentre) and its main advantages are high weight, sweet and most importantly it is droughtresistant. This is an important factor as 97-98 per cent of the surrounding area has noirrigation system. The government sets the price of sugar cane, based on the sweetnesslevel indicator, ‘commercial cane sugar’ aka CCS. The going price is 600 baht for 10CCS, which roughly constitutes a ton of sugar cane. The sweeter the sugar cane (i.e. thehigher the CCS level), the higher is the price. One extra CCS level gives an extra 36 bahtto the farmer (or around 10% of the government’s set price). In general, the CCS level ofsugar cane prior to mid-January is around 10.5. As the crops are more matured, the CCSlevel will consequently rise. The majority of sugar cane the factory received has the CCSlevel of around 12.5. The highest CCS level the factory has seen is 16 (very rare). TheCCS level of each sugar cane stock received at the factory is determined by staffs fromthe Ministry of Industry. 152
    • The majority of the workers are from local and nearby surrounding areas, especially thefull-time workers. A quarter of part-time workers are migrated from the Northeasternareas in Thailand. There are 350 full-time workers and 650 part-time workers. The part-time workers are only employed during the harvest period between December to April.The full-time workers receive a salary on a monthly basis. There are 3 salary bracketswithin the setup. § The technician assistants receive less than 10000 baht/month. § The technician and foremen get between 10000-30000 baht/month. § The management staffs receive more than 30000 baht/monthThe temporary workers get 157 baht/day for 8 hours of work (the average in KhokCharoen is less than 150 baht per day). However, they can also get an OT (overtime)pay, working an additional 4 hours for 117.75 baht. This is a 4 hours work for the wageof 6 hours at normal rate. ProcessesAnalysis: this factory has a large influence on Khok Charoen even though it does notlocate within the Lop Buri province. The reason for this is that the factory is actuallynearer to the district than some other sugar factories within Lop Buri. This is particularlyimportant as sugar cane is one of the main agricultural products that come from KhokCharoen. The factory has great power over the sugar cane farmers in that the farmers arecontractually obliged to sell their products as well as being tied to the loan given to thefactory. Some people from Khok Charoen are also employed by the factory, either on afull-time or part-time basis. It is unlikely that industries of such scale can be set up inKhok Charoen as it requires large capital of investment, significant improvement in thelevel of infrastructure, availability of raw materials as well as the fact that it may not beeconomically feasible to compete with existing industries. For example, as mentioned,during harvest season the factory uses 25000 tons of sugar cane per day in theirproduction. The total volume in Khok Charoen in the year 2005 is only 375733 tons.4.1.6 Summary on problems and potentials of the industrial sector in Khok CharoenThe main strength of Khok Charoen lies in the rural industry, or more specifically in theform of weaving production. The majority of the population is migrated fromNortheastern area of Thailand, in which they bring with them indigenous knowledge andartist expertise in weaving production. Currently, there are at least 400 peopleparticipating in weaving activities showing there are enough skilled workers to expandthe capacity of production. The quality of weaving products here is of very high qualityand many of these products have been given OTOP status. In addition, 10 weavingproducts have been given 4 or 5 stars (max. 5) for their quality; this is significant as thereare only 72 products in Lop Buri which have been given this status. It should also bementioned that Lop Buri lies in zone 3 in the criteria established by the Thai Board ofInvestment (BOI). With this, comes a maximum benefits in terms of import duty and tax 153
    • exemption and thus an industrial unit set up in Khok Charoen will gain an economicadvantage over those set up in other geo-economical zones. Current national andprovincial strategic aim has also emphasized on the development of agro-processingindustry. This can be interpreted as strength of Khok Charoen as the majority of thepopulation is already employed in the agricultural sector and the district has seen highyield in products such as paddy, sugar cane, and cassava. The agricultural input can thusbe used as input materials to facilitate agro-processing industries.However, there are many weaknesses in the industrial sector. Despite the quality ofweaving products in Khok Charoen, there are limited market channels and opportunitiesto sell the products, hence the low recognition of Khok Charoen brand of weavingproducts. From the study, it was clear that members of these weaving groups lackentrepreneurship skills and consequently they rely on middlemen coming to purchasetheir products. To make problem worse, some groups even rely on the same middlemento provide them with raw materials necessary for production. Thus despite the quality oftheir products, their income from this has actually been decreasing. To illustrate this, theincome generated from OTOP products in Khok Charoen district has decreased byaround 7% between the years 2006-2007. This weakness can also be used to describe thesituation of other groups such as handicraft. Through interview of staffs from district andTambon office, we have also found that there is limited collaboration among variousoccupational groups performing similar activities. Thus there is no process for the groupsto learn from the mistakes that other have already experienced in their businessoperations. In addition, it should be raised that there is an inadequate level ofinfrastructure to set up a large scale industrial unit in Khok Charoen. From field visit to alarge sugar factory in nearby province (Sri Thep, Petchabun), we have found such scaleof industry requires a lot of water and electricity in their production and maintenanceprocess. It is also dependant on a large road network for transportation of their products;this is however not sufficient in Khok Charoen.Table 4.13 List of main problems in the industrial sector Problems Causes 1. Shortage of § Lack of collateral for loan due to no land title. capital for § Lack of skills in managing financial resources. Low level of investment. entrepreneurship among the population. § Supporting funds are not sufficient for distributions to all groups. 2. Lack of § Exploitation by local middlemen whether in terms of supply of market channels raw materials or purchase of end products. § Limited market network and information. § Since many groups are small in terms of number of members (= less production), they do not enjoy economy of scale and has little market power. 3. Decreasing § Lack of market channels level of income § Increasing price of raw materials and transportation cost. generated § Low recognition of Khok Charoen brand of weaving products. 154
    • OTOPs4. Limited § Although the majority of the people in Khok Charoen arecollaboration migrated from the Northern-eastern part of Thailand, they areamong various originated from different provinces. Thus interaction betweenweaving groups various groups is limited. § Loss of strong community/group leaders. § No organized location for interaction to take place.5. Low § Lack of market channels.recognition of § For weaving products, there is a strong competition from nearbyKhok Charoen district such as Ban Mi where the capacity of production is muchbrand of higher. There is also fierce competition from other provinces inweaving the North-eastern region of Thailand.products. Table 4.14 List of potentials of industrial sector in Khok Charoen Factors Descriptions1. Policy § Industrial zone; maximum benefits. § National and regional promotion on agro-processing industry. § Adequate vocational training programs.2. Access to raw § The primary occupation in the area is in agriculture. Thematerials main products include sugarcane, cassava, paddy, corn. There are also many beef cattle in the area, thus consideration on local slaughter house may reap considerable financial reward. § Information from the Provincial Industrial Office has also shown that some minerals such as pyrite are available in the area; this can be seen as another potential for industrial development.3. Location § The location of Khok Charoen is on the fringe of Lop Buri in the North. Thus Khok Charoen has access to nearby provinces such as Nakhon Sawan and Petchaboon, as a source of raw materials and as market outlets. Lop Buri, itself, is not so far away from Bangkok (only 155 km). § There is not much competition in the area at all levels of industry.4. Skills and § Total working population in the area amounts to aroundlabour 11,000 people. Since the majority of the population engaged in the agricultural sector, which is seasonal, they will be able available to accept another form of employment opportunities. § The average income per day in non-agricultural activity is surveyed to be around 150 baht or less, in general for the whole district. § At least 590 people are recorded as having taken a form of vocational training. § The population possesses indigenous knowledge and skills in weaving production. They also possess unique design and pattern of fabric. 155
    • § Quality weaving products are renowned in Khok Charoen. Many OTOP products here are given 4 and 5 stars award for their quality. 5. Adequate § Accessible road networks. infrastructure for § Access to electricity. small and § Adequate water supply. medium scale industry4.2 Trade and Commerce4.2.1 General Information and Current Situation on Trade and CommerceThere are 102 enterprises and partnerships with the registered investment of 154,240,000baht in the province of Lop Buri. It classified into 28 enterprises with registeredinvestment of 30,900,000 baht, and 74 partnerships with the registered investment of123,340,000 baht. The province has 18 permanent markets, 6 located in Mueang LopBuri, 2 in Ban Mi, 2 in Chai Badan, 2 in Khok Samrong, 2 in Nong Muang, and ThaLuang, Ta Wung, Phattana Nikhom and Sa Bot each has one.There is no any permanent market in Khok Charoen district, the only weekly and mobilemarkets operating in the district. In the district, there are 9 places of weekly marketlocated in different Tambon and operating different date and time. These markets sellcloths, grocery, house ware, electricity ware, meat, vegetable and fruit. The district hasmobile market system, traders upload there goods to pick up truck and travel aroundvillage by village. The mobile market sell cooked food and fruit, they travel mostlyduring the meal time especially lunch time. Retail shops in Khok Charoen district consistof private shop and community shops, these shops sell grocery and soft drink. Totally,there are 373 private shops in Khok Charoen. Those shops are requested to pay tax todistrict tax office. There are two types of tax named sign tax and housing taxAlthough, in the district has no permanent market. However, local traders have marketlinkage with Srithep market, Phetchaboon province far away from the Khok Charoenmore than 15 km, Nong Muang market, Lop Buri province far from his home more than30 km, and many markets in Lop Buri district the capital city of Lop Buri province.There are two types of market in Khok Charoen district, namely weekly market andmobile market. These markets are the main source of providing goods and service. Thereare many kinds of commodities sold in the market including food, clothes, fruits,vegetables, animal meat, grocery, electricity ware etc. The markets serve the people intheir own Tambon and also other surrounding Tambon. Some kinds of the commoditiesare taken from outside Tambon, namely from Bangkok, and also neighboring province.Khok Charoen district has no any industry to produce goods for local consumption andexport to outside, the only non-agriculture products from the district flow out is only 156
    • weaving and handicraft products. The common products in the district sold out areagricultural product such as sugarcane, cassava and vegetables. Livestock is one mainsource of outflow such as cattle which is very common in the district.4.2.2 Markets and Shops in the Districta. MarketWeekly MarketsWeekly markets operate in different place and time found in the district. Total number ofweekly market in Khok Charoen is 10 places. These markets existed in all Tambon,serving people living around four to five villages providing some basic goods for dailyhome consumption. Some places operate more than one time a week for example inTambon YangRak at village number 4 and 9 operate two times a week and Tambon NongMakha at village number 8 operates 3 times a week (Table 4.15).Table 4.15 Distribution time and place of weekly market in Khok Charoen district. Location No. Tambon Schedule (time operated) (Moo) Moo 2 Sunday evening (3-8pm) [one time/week] 1 Khok Charoen Monday evening (3-8pm), Thursday evening Moo 4,5 (3NA8pm) [two times/week] Moo 2 Sunday evening (3-8pm) [one time/week] Wednesday and Saturday Morning (6-9am) [two Moo 4 times/week] 2 YangRak Tuesday and Thursday evening (3-8am) [two Moo9 times/week] Moo 10 Saturday evening (3-8pm) [one time/week] 3 KhokSamaesan Moo 4 Tuesday evening (3-8pm) [one time/week] 4 WangThong Moo1,2 Friday evening (3-8pm) [one time/week] Sunday morning (6-9am), Tuesday and Thursday 5 NongMakha Moo 8 evening (3-8pm) [three time/week]Source: Interview with TAOs 157
    • Mobile MarketsThis is a dynamic kind of market for rural villagers; it provides a very convenienceservice to rural people with food, fruit and other different kind of commodities for basicneeds. In Khok Charoen district, mobile market performed as direct sale, traders bringthose kinds of goods to serve people at their home. The advantage of mobile market is tofacilitate the rural people to access to the necessary goods and commodity especially foodand fruit. This type of market reduces the cost of transportation of the villagers andvillagers also can save their time on traveling to other shops or markets. However, due tothe increasing of fuel price, the cost of transportation of traders has increased and itreducing the profit of traders. Hence, traders have to increase the price of goods whichleads villagers need to pay more and more on price of those basic goods. One of thevillagers complained that every item has increase the price at least 10% compares to lastcouple years.b. ShopsCommunity ShopsThe community shop is an activity of cooperative base shop, establish by the savinggroup with the help of district community development office. Villagers participatethrough their contribution as saving capital formation and involved in management to runthe shop. The shop has a good economic implication on the rural people in term of theirsaving and good service in order to get benefit through saving mobilization on non-farmactivity. The shop function as local needs support for local people who have less capacityto travel to buy things for their family at far away market. The community shop alsohelps local people who to buy goods in credit in the case that members have not enoughcash in hand, then he or she can pay back later. The shop sells beverage, food, houseware, and grocery and some shops sell some items of motorcycle and car spare part, oiland fuel.Case study: Community shop of Ban Mai Si Ou Bon, Tambon Nong Makha, KhokCharoen district- Year establish: 1991- Location: Ban Mai Si Ou Bon, NongMakha- Main goods: groceries, beverage, some spare part of motorcycle, oil 158
    • and fuel- Member: 25 (1991), 95 (2008)- Committee member: 7 people, village head man as the chair person- Working time: 6 am to 9pm- Contract seller: one person- Seller salary: 32% of annual net profit- Source of fund: SML and share (total 950,000 baht)- Share price: 10 baht/share- Dividend/member: 1 baht/share (10 baht gain 1 baht)- Duration: One year a time of dividend provided- Infrastructure: District Community Development Office provided- Goods purchasing: Through middlemen (Whole seller bring for the shop) and, staff went out to buy from whole seller shops in Khok Charoen town- Management: Executive Committee of the shopPrivate ShopsKhok Charoen district has several types of shop regarding to the tax office, shops wereclassified into many types according to their functions. The largest number is convenientor grocery shops then flow by car and motorbike repair shops and gasoline pump. Theseshops are owned by private, functioned as household business to provide service forvillagers and people living around. According to the data from Tambon tax revenue list,in each Tambon has different types and number of shops. The highest number of groceryshop is in Tambon Khok Charoen, and then follows by Tambon Nong Makha, the leastnumber of grocery shop is in Tambon Wang Thong (Table 4.17). Number of groceryshop shows the rate of household business activity in that particular Tambon.According to Table 4.16, Tambon Khok Charoen has the largest number of shops whichaccount for 29.49 per cent, when we take to population ratio (total population divided bytotal shops) Khok Charoen has the least ratio. Tambon Wang Thong has the leastpercentage of shop but the second least ratio. It means Wang Thong has less populationeven the number of shop is less, but people can also have more chance to access to theshops. However, the variety of shop (goods and service) is not good as Khok Charoenand other Tambon. We cannot assume the shop type due to the data on shop given is notclassified in to different type of shops dealing with different goods and services.Table 4.16 Distribution of total shop by Tambon No. Tambon Population Total number of shops Percentage of shop in each Tambon 1 Khok Charoen 7,296 110 30 2 YangRak 7,783 71 22 3 KhokSamaesan 3,231 39 12 4 WangThong 2,638 35 11 5 NongMakha 3,509 75 23 Total 24,457 330 100.00Source: TAO office, 2007 159
    • Table 4.17 Distribution of Shops by Tambon Shops No Tambon Car and Total Grocery Gasoline Agriculture Construction motorbike Pharmacy Others* shops pump inputs material repair 1 Khok Charoen 72 4 12 5 4 4 9 110 2 YangRak 69 2 NA NA NA NA NA 71 3 KhokSamaesan 35 4 NA NA NA NA NA 39 4 WangThong 35 NA NA NA NA NA NA 35 5 NongMakha 48 3 10 1 1 NA 12 75 Total 259 13 22 6 5 4 21 330 *Hair salon, knitting shop, restaurant and game shop Source: TAO office, 2007 Table 4.18 Ratio of Population under the Service of Shops in Tambon Khok YangRak Khok Samaesan WangThong NongMakha TotalTypes of shops Charoen Shops Ratio Shops Ratio Shops Ratio Shops Ratio Shops Ratio Shops RatioGrocery shops 72 101 69 113 35 92 35 75 48 73 259 94Gasoline pump 4 1,824 2 3,892 4 808 NA NA 3 1,170 13 1,881Car and motorbike 12 608 NA NA NA NA NA NA 10 351 22 1,112repairPharmacy 5 1,459 NA NA NA NA NA NA 1 3,509 6 4,076Agriculture inputs 4 1,824 NA NA NA NA NA NA 1 3,509 5 4,891Construction 4 1,824 NA NA NA NA NA NA NA NA 4 6,114materialOthers* 9 811 NA NA NA NA NA NA 12 292 21 1,165Total 110 66 71 110 39 83 35 75 75 47 330 74 Source: TAO office, 2007 160
    • Figure: 4.15 Density of Population to Private Shops Map 161
    • Figure: 4.16 Distribution of Weekly Market Map Tambon Nong Makha 3 3 2 1 1 0 Places Frequency conducted Tambon Khok Charoen Tambon Wang Thong 3 3 3 2 2 2 1 1 Tambon Yang Rak 1 1 0 0 Places Frequency 8 6 Places Frequency conducted 6 4 conducted 4 Tambon Khok Samae San 3 2 2 1 1 0 1 Places Frequency 0 conducted Places Frequency conducted 162
    • Figure: 4.17 Market Linkage 163
    • Market Linkage and Network AnalysisThe Figure 4.15, 4.16 and 4.17 provide as very clear explanation on shops and marketsdensity in Khok Charoen district. In the district has no any permanent market, whiledistrict nearby named Srithep has a big permanent market; traders in Khok Charoen haveto travel to buy goods from Srithep to sell in the district. There are 10 weekly markets inthe district; the weekly markets as well as shops are not well distributed fairly in thedistrict. Thus, some Tambon are less number of shops and weekly market to serve theirpopulation, while others have much more market and shops density comparing to thepopulation size. Hence, it means that not very people in every Tambon can access and gettheir need from their local market. They have to spend some time to travel for goodspurchasing for their daily need. Regarding to this situation, the population who live at theplace has less service, they are disadvantage in term of access to variety of service as wellas price of common basic goods comparing to the neighboring area. We also can see thatthe largest numbers of shops and other services are agglomerated in Tambon KhokCharoen. Hence, maybe in Tambon Khok Charoen is the most advantage Tambon in thedistrict.Neighboring districts are the sources of daily goods that traders from Kho Charoendistrict usually go to buy goods to sell in Khok Charoen. Regarding to the map there arefour neighboring districts which has road connection with Khok Charoen named Srithepdistrict far from Khok Charoen around 25 km, Nong Muang 30 km, Sabot 20 km andChai Badan 45 km. In the case that traders want to buy in big volume they have to go toLop Buri city where far away from Khok Charoen around 80 km.Since, the road access is very important for trade and commerce. According to the map,transport node is quite in good situation. Thus, better the road connection provides morechoice for local traders dealing trading with neighboring markets, and also brings outlocal products to outside markets.4.2.3 Marketing Channel of ProductsMarketing channel were classified in two parts namely inflow channel and outflowchannel. The inflow channel to present the goods those are being brought from outside tothe Khok Charoen district which classified into four main components related to non-agriculture sectors namely cloths, grocery, house ware and electricity ware. The outflowchannel present the goods and products which the district and produce and send out tosell in other market outside the district. The goods and products which are beingproduced in the district and sending to market outside are weaving product, basketryproduct, Thong Muan (Thai sweet role) and agro-processing product such cassava andsugarcane. The flow of these goods and products were drawn base on the interview withTambon administrative offices, shop owners and traders in the various weekly markets.The whole seller, cloth shop owners and cloth traders buy clothes from Bangkok (BoBemarket). First channel, some of them group together around 5 to 6 people, then hire a 164
    • truck to go to Bangkok to buy cloths. These people are from Srithep district, Phetchaboonprovince, who come to sell cloth in the weekly market in Khok Charoen district. Secondchannel, retailers or shop owner in Khok Charoen district go to buy for Srithep market,Srithep district, Phetchaboon province where far away around 25 km, and go to Lop Buricity (Big C) to buy cloths especially at the time of discount price campaign. Thirdchannel, middlemen who have truck bring the cloths to sell to the shop owner in thedistrict (Table 4.19).Mostly, groceries are brought from Srithep market in Srithep district Phetchaboonprovince. Many private shop owners go to buy grocery goods from this particular market.This market centre considered as service center of this region two or three districtssurrounding name Srithep, Khok Charoen, Chai Badan and Wichien Buri. Another place,grocery is brought from Lop Buri city by whole sellers; they brought these kinds ofproducts to sell for private shops, which serve people living around.There are some source markets of the goods inflow to Khok Charoen district such asBobe market, Talat Thai, Phitsanulok market and others, locating in different locationsuch as Bangkok, Pathumthani, Phetchaboon province etc. It is also noticed that differentkind of commodities and goods are from different markets. The commodities and goodsinflow to the district include food products (fruits, vegetable and food), consumerproducts (cloths, electricity ware) and raw materials for agro-processing. Since, thedistance of the source market is located far from the district; the cost of transportation ofthe commodities is one of concerns in terms of the profit for the traders.Table 4.19 Markets, Location and Time Spent of Inflow Products Foods Products Market Major products Location DistancePhitsanulok Fruit (orange) 2 hours and Phitsanulok provine 30 minutesTalat Thai Fruit (grave fruit) 2 hours and Pathumthani province 30 minutesSrithep market Dry food and instant 25 minutes PhetChaboon province food Consumer ProductsBobe market Cloths 3 hoursBig C supermarket Cloths, Cosmetics, 1 hours Toys, and electricity wareSrithep market Kitchen items, 25 minutes electricity ware Raw material for AgroNAprocessingNakhon Sawan Cassava Nakhon Sawan 15 minutes provincePhetChaboon Cassava PhetChaboon province 30 minutesSource: Market survey, Khok Charoen district, February 2008Figure: 4.18 Marketing Chanel of cloths 165
    • Marketing Chanel of Cloths Factories/Companies Export to International BOBE Market, Market Bangkok Lop Buri, Province Consumers in Khok Charoen Private Retailer shop in Khok Charoen Whole seller in Sithep Market, Sithep District, Weekly market in PhetChaboon Khok CharoenSource: Interview with TAOFigure: 4.19 Marketing Chanel of groceries Marketing Chanel of Grocery Whole Seller In Bangkok Big C and Whole Seller, Lop Buri, Province Community Shops Whole Seller, Consumers in Khok Charoen Middlemen & Private Retailer Deliverers shop in Khok Charoen Whole seller in Sithep Market, Sithep District, Weekly market in PhetChaboon Khok CharoenSource: Interview with TAO and shop ownerFigure: 4.20 Marketing Chanel of House ware products 166
    • Marketing Chanel of House Ware Factories/Companies Big C and Whole Middlemen Seller in Lop Buri, Province Consumers in Khok Charoen Private Retailer shop in Khok Charoen Whole seller in Sitheb Market, Sitheb District, Phet Weekly market in Chaboon Khok CharoenSource: Interview with TAO and shop ownerFigure: 4.21 Marketing Chanel of Electric ware Products Marketing Chanel of Electricity Items (TV, fan, rice cooking pot) Factories/Companies Export to International Market Middlemen Consumers in Khok Charoen Private Retailer shop in Khok Charoen Whole seller in Sithep Market, Sithep District, Phet Weekly market in Chaboon Khok CharoenSource: Interview with TAOTable 4.20 Markets, Location and Time Spent of Outflow Products 167
    • Foods Products Destinations Major products Location Distance Talat Thai Vegetable Pathumthani 2 hours and 30 province minutes Lop Buri Cattle Phetchaboon ThongMuan (Sweet Phetchaboon 25 minutes roll) province Nakhonsavanh ThongMuan (Sweet Nakhonsavanh 15 minutes roll) province Consumer Products Lop Buri Weaving products Province 1 hours Agro-processing Ayuthaya province Cassava Nakhonsavanh province Sing Buri Sing Buri province Sara Buri Sara Buri province Srithep Sugarcane Phetchaboon 70 minutes provinceSource: Market survey, Khok Charoen district, February 2008In Khok Charoen district, there are various local agricultural and non-agriculturalproducts. Those products include food products, consumer products, and agro-processingproducts. There are also OTOP products of Tambon, namely weaving products, ThongMuan product. The weaving products are sold to several markets in Bangkok, Lop Buriprovince. And the markets of Thong Muan products are in neighboring provinces. So, ingeneral, the products of the district have been sold to different markets, which are locatedin different destinations (Table 4.20).4.2.4 Role of MiddlemenSince, the district explore to external market for their local products. Middlemen becomemore important for local people, these middlemen functioning as connection betweenlocal to external and provide raw material for local production. The case of weavinggroup, after the head of the group had passed away, group members solely depend on themiddleman who come from Banmi district. Almost weaving products from KhokCharoen sell to him, this person control price. Another, function of middlemen as goodsdeliverers, these people have truck connected with whole seller in city (Lop Buri city,Srithep and Nong Muang district). Goods are brought and unload in each private groceryshop follow by orders.4.2.5 TaxationIn 2006, the total revenues from different sources amount to 13,478,840 Baht. Therevenues are generated from some sources including tax, non-tax, grant and treasury. Therevenue from collecting tax has a significant share to the total revenue, accounting for 56 168
    • percent of the total revenue, followed by grant of 24 percent. The non-tax share only 1percent. Figure: 4.22 Distribution of Tax revenue of Khok Charoen District in 2006 Treasury 19% Tax Grant 56% 24% Non-tax 1% Source: Tax office, Khok Charoen districtTax is a one source of the district revenue; there are various types of tax includingbusiness tax and income tax, which are collected from the commercial shop andindividual income. According to the data given, there are two types of tax charged fromthe private shops called housing tax and sign tax. The Figure 4.23 shows the tax revenuefrom each Tambon of Khok Charoen district in 2007. The highest tax revenue from KhokCharoen accounted for 31,183 Baht, then follow by Wang Thong accounted for 19,529Baht. The least tax revenue is Tambon Khok Samae San accounted for 9,150 Baht in2007. Regarding to the shop distribution Tambon Wang Thong has less number of shops,but the revenue from tax is higher than other Tambon except Tambon Khok Samae San.The reason is there are two large shops that paid higher tax nearly 20% of the total tax ofthe Tambon. Figure: 4.23 Tax Revenues Generated from Private Shop by Tambon in 2007 Source: TAOs 169
    • 4.2.6 Financial InstitutionsExisting Financial InstitutionsThere are state-owned and private financial supporting institutions in Khok Charoendistrict, which provides financial services to the farm and non-farm activities. Thosefinancial institutions include VDF, BAAC and Bangkok Bank (only the mobile bankavailable in the district).Case study of Bank of Agriculture and Agricultural Cooperative (BAAC)Bank of Agriculture and Agriculture Cooperative (BAAC) is a state-owned financialinstitution established in the year 1966 with the aim to provide financial services tofarmers, farmers groups, agriculture cooperative and farmers associations for theinvestment primarily in agriculture sector. It is now operating throughout the country.The BAAC offers following services such as credit/finance, deposit facility and inputsupply.There is no BAAC representative office in Khok Chareoun district, but in the neighboringdistrict of Nong Muang. Those who want to get loans have to contact the office in NongMuang. In addition, the major focus of the BAAC is on agriculture; however, it alsoprovides loan support to non-agriculture sector as well. The total investment on non-agriculture sector is nearly 10 percent (December 2007) and recently BAAC has beendecided to increase investment in non-agriculture sector up to 20 percent.Although BAAC has not yet established office in the district, the office located at NongMuang is responsible to provide necessary financial services. Farmers’ groups areplaying key roles in mediating between individual farmers and the bank. Groups collectloan demand and submit them to the bank office and they monitor the use of loan amount.The interest rate on loan also ranges from 6-7.5 percent. Total number of clients and loandisbursed in Khok Charoen district were 2,777 clients and 228,186,855 Baht respectively(Table 4.21).Table 4.21 Number of Clients and Loan Amount Disbursed Tambon Number of Farmers Loan Amount Disbursed (Amount in Baht) Khok Charoen 746 68,482,574 Khok Samae San 369 42,388,624 Yang Rak 603 53,388,357 Wang Thong 290 29,511,575 Nong Makha 269 34,415,725 Total 2,277 228,186,855 Source: BAAC, 2007In addition, loan flow system of BAAC is divided into two ways, namely (i) loan toindividual farmers on individual guarantee basis and (ii) BAAC provides loan to group 170
    • members on group guarantee basis. In this system, group collects loan demands andsubmits to BAAC offices.4.2.6 Supporting Institution on Trade and CommerceTambon Administration Office (TAO)Tambon Administration Office (TAO) has provides supports to local people for theirincome generation. The services and supports which are provided by the TAO asconsultation for any traders and local producer who want to start to run their businessparticularly the OTOP products. The other support is facilitator and connector betweenlocal people and other agencies such as government, TAO propose the needs of localpeople to government in term of fund needed, technical needed and others needs relatedto their local potential income generation. However, TAO can only support the localpeople whoever had well organized, the groups or association of any production canrequest and ask for funding and technical support from the TAO. For example the cattleraising groups, weaving groups and organic vegetable these groups got supports fromTAO.Communication Development Offices (CD)The District Community Development Office (CD) is a government agency who dealingwith the local community development in within the district. The CD provides varioussupports to the community for the community income generation and self sufficiency.Supports which related to the non-agricultural activities in the Khok Charoen district arefacilities provision such as community house building for community shop in TambonYang Rak and CD also provided some seed grant in term of goods for sale for thecommunity shops. The CD not only provide fund and facility, the training to improvelocal skilled is also provided. The main focus of CD is basically on OTOPs and villagedevelopment fun.Provincial Commercial Office, Lop Buri ProvinceThe Provincial Commercial Office is the leading organization for economic developmentin the province and sustainable economic growth. It is the one of the various offices whoprovides support for economic development in provincial level. The main role andresponsibilities of office are to strengthening of the entrepreneurs’ capacity and providesupport for marketing and services, and protect intellectual property. Every year theProvincial Commercial Office has activities plan and budget to propose to the provincialgovernor office to implement support activities related to market promotion for localentrepreneurs. 171
    • Table 4.22 Department of Business Development Strategy (2008-2012) Vision Mission Strategies Strategic Plans Goals Support StrategiesExcellence in Sustainable Develop capacity • Provide advices for Strong business and • Applyproviding Development of of entrepreneurs entrepreneur can compete with technologyservice and trading and service and promote • Create potential market for others information incapacity business target business implementationbuilding for • Develop business institution of workbusiness • Developcompetition Provide information Develop • Expand the business Source of data and human on trade and information and information and data base information service resources for commerce on time data base for • Utilize information participating in and efficiency supporting • Develop data and the process of business information service through strategic information technology (IT) planning Fast and transparency Develop • Utilize information Fast, transparency, • Modify and of business registration system technology for business efficiency and adapt the law registration registration correct. regarding to the • Modify the registration real situation. procedure • Introduce and • Create good service make announce environment organization to Businesses Promote and • Promote standard business Business has a be acceptable. monitoring for monitor the accountant system accuracy account achieving good business to ensure • Enhance knowledge on and follow the law governance the good thrust business law of entrepreneur • Manage and monitor business dealer follow the law and regulation Source: Provincial Commercial Office, 2008 172
    • Bank of Agriculture and Agriculture Cooperative (BAAC) Bank of Agriculture and Agriculture Cooperative (BAAC) is a state owned financial institution established in the year 1966 with the aim to provide financial services to farmers, farmers groups, agriculture cooperative and farmers associations for the investment primarily in agriculture sector. The major focus of the BAAC is on agriculture; however it also provides loan support to non-agriculture sector as well. The total investment on non-agriculture sector is nearly 10 percent (December 2007) and recently BAAC has decided to increase investment in non-agriculture sector up to 20 percent. 4.3 Tourism 4.3.1 Tourism Situation in Lop Buri Province Regarding to the tourism statistic provided by the Tourism Authority of Thailand in Lop Buri Province in the year 2005 and 2006. Tourism is considered one of the main sources of revenue generation in Lop Buri province. The tourism industry in the province can attract the significant number of visitors and tourists of both Thai and foreigners. The number of visitor increases from 2,784,301 in 2005 to 2,807,428 in 2006; and the tourist number also increase from 720,702 in 2005 to 779,084 in 2006. The revenue generated from this sector values at 2,768.31 million Baht in 2006. The total revenues increases 5.18 percent, compared to that in 2005. This can hugely contribute to the socio-economic development of the province itself, by providing the local people with the local employment opportunities and income earning. Table 4.23 Internal Tourism Statistics of Lop Buri Province January-December Type of data Change (%) 2006 2005Visitor number 2,807,428 2,784,301 +0.83• Thai 2,605,445 2,449,027• Foreigners 201,983 335,274Tourists 779,084 720,702 +8.1• Thai 774,072 712,181• Foreigners 5,012 8,521Excursionists 2,028,344 2,063,599 -1.71• Thai 1,831,373 1,736,846• Foreigners 196,971 326,753Average length of stay (day) 2.2 2.25• Thai 2.2 2.26• Foreigners 1.58 1.67Average expenditure (Baht/person/day) 740.77 714.21 173
    • • Visitor 946.87 923.60• Tourist 567.11 549.66• ExcursionistTotal revenue (million Baht)Visitor 2,768.31 2,631.97 +5.18• Thai 2,623.74 2,398.35• Foreigners 144.57 233.62Accommodation Establishments Establishments 35 26 Rooms 1,775 1,142 Occupancy Rate (%) 44.91 63.72 Average Length of Stay (day) 1.87 1.88 Number of Guest Arrivals 305,616 272,374• Thai 301,635 264,553• Foreigners 3,981 7,821 Source: Central office 7, Tourism Authority of Thailand Note: Internal tourism = Domestic + Inbound Lop Buri has many attractive tourist places those are including dam, archaeological site, and natural site. According to the statistic (TAT, 2004) the percentage of total tourists prefered to visit Pasak Sonlasith Dam accounted for 30.93 of 2,162,274 tourists. Table 4.24 Attractive tourist place in Lop Buri by share of visitors in 2004 Share of Tourists No. Tourist Places Share of total Share of total Total Share Thai visitors Alien visitors 1 Pasak Solasith 31.74 27.53 30.93 2 Phra Narai Rathchanivet 26.30 22.29 25.54 3 Sala Phrakan 22.32 3.91 18.81 4 Phra Keo Zoo 13.85 1.79 11.55 5 WangKanLaueng Waterfall 13.55 0.51 11.06 6 Phra Prang SamGnoth 5.86 1.79 5.08 7 Mooban Thamdinsorphong 5.89 14.52 7.54 8 WatKhaovongkot 8.15 3.93 7.35 9 Saun Roukkhaxat 7.18 1.68 6.13 Source:TAO,2008 174
    • Figure: 4.24 Tourist Map in Lop Buri ProvinceSource: http://thai.tourismthailand.org/map/Lop BuriNA16NA1.html, download on 9/4/2008 175
    • 4.3.2 Tourism Situation in Khok CharoenCurrent situationIt is noticed that there is no significant tourist attractions in Khok Chareoun district. Thedistrict is quite isolated and a bit far from the provincial center and it is not the placewhere many of the travelers have to pass across.Ten years ago, in Tambon Wang Thong, there were three tourist places, namely Grapegarden, Animal Zoo, and Fishing Pond. These three places also attracted the tourists tothe district. However, after three years later, the visitors decreased and these touristplaces could not run any more. It is unfortunately that the tourism statistical data cannotbe obtained in order to presents and compare to other districts within the Lop Buriprovince. The tourism development plan in Khok Charoen district is still in the initialprocess, there are no any concrete and any document plan focusing clearly on tourismindustry development in Khok Charoen district. The season behind this is the lack ofattractive tourist places. Thus, the district had not prioritized the tourism industry in thedevelopment agenda. During the time of discussion with TAO and we were told that therewere not any attractive place to develop for tourism purpose, and the potential on thetourism is hardly to identify. However, the district also receives some visitors who visitsNuern Rang Vora Panya temple in Tambon Yang Rak, due the free of charge visit thestatistic on how many tourists that this particular place received is not available.Existing potentials tourist attraction placesAlthough the district is rarely to find the tourist place, but in Yang Rak still has someundeveloped tourist places. Local handmade (weaving and handicraft), cultural (rocketfestival) and natural tourist place (water reservoir in Khok Sa Mae San and waterfalltourist place in Tambon Yang Rak) are waiting to develop to attract tourists come to visit.Tourism in Neighboring AreasIt is known that there is no existing tourism place in Khok Charoen district, even thoughsome places are seen the potential for tourism development. However, in the future if thedistrict has plan to develop the tourist attraction, it would be an opportunity since thereare some tourist attractions in its neighboring district, which would be linked together. Inthis sense, the tourists who visit the other places around Khok Charoen district could takechance also to visit tourist places in Khok Charoen as it seems not so far from each other.These surrounding attractive tourist places include historical tourist site in Srithepdistrict, natural tourist place of Wang Kan Luang waterfall in Tha Luang district, Ban Miweaving centre in Ban Mi district, Wong Khot Mountain in Ban Mi district and WongPrachan Mountain in Khok Samrong district. It is a favorable condition that could be 176
    • linked between the tourism in the district and surrounding thanks to good road networkand condition; and the distance between these areas is not so far from each other.It is advantageous that the package tour could be formed to visit these areas. The touragency can arrange for one or two day package tour that includes the trip to weavinggroup in Ban Mi, Khoh Charoen and historical place in Srithep. So, the target group whowill visit these areas could be the group who are interested in natural, cultural, traditionaland historical tourist sites.4.3.3 Problem and Potential on TourismAccording to the observation and interview, there are no tourist attraction places andactivities in Khok Charoen district. Furthermore, there are no planning and budget topromote the tourism part. However, there are 22 weaving groups in Khok Charoendistrict and these existing weaving groups have indigenous knowledge and skills and theweaving products are 5 star awards with unique design and pattern of fabric. So, culturaltourism could be promoted in Khok Charoen district by setting up training centre andknowledge and skills could be passed to young generation. These weaving groups couldbe cooperated and promoted to work together and train local and visitors who would liketo learn weaving. In addition, there will be great opportunities to generate income forweaving groups, promote local indigenous knowledge and maintain the local cultural andtradition by cultural tourism based on potential. The historical tourist place in Srithepdistrict, near Khok Charoen district can be linked.4.3.4 Tourism Policy/Strategy/Plan and PromotionNational and Provincial LevelAccording to the 9 th national development plan, the tourism was assigned as a factor forsupporting economic development of Thailand. The tourism development base on localresource mobilization especially human resource and natural resource capacity, thedevelopment was based on the local potential such as culture, customs. Then, promoteThai tourist visit Thai and also attract alien visitors.The master plan of tourism industry (2000-2010): • Develop Thailand tourism to be the leaders of tourism in Asia and toward to world class destination • Develop tourism industry for national income as important as agriculture and industry sectors • Decentralize tourism and income distribution from tourism to rural area • Enhance tourism facility to be able to compete the world free market • Promote and enhance local governors’ capacity to be able to handle the tourism in local efficiency • Protect the natural and unique local culture and customs. 177
    • District LevelCurrently, there is no any concrete plan on tourism development in the district. Thedistrict has initial ideas to develop potential tourist attraction, for instance, weaving,handicraft and tourism festival (rocket festival) and develop natural tourist place such aswater reservoir in Khok Sa Mae San and waterfall tourist place in Tambon Yang Rak toattract the tourists who visits Srithep, which is neighboring, to come to visit in KhokChareoun district also. In addition, Tambon Yang Rak has the plan to develop waterfalltourist place in village 8 in the next two years.SWOT analysis of TourismTable 4.25 SWOT analysis of tourism Strength Weakness • Cultural (traditional, unique design • Limited of attractive tourist place and pattern of fabric, weaving • Lack of development plan on product) potential tourist place • Good transport node • Limited of tourist facilities and • Variety of outdoor activities and amenities such as hotels, traditional culture activities/events restaurants and tourist information such as rocket festival centre • Tourism is not priority of the district development plan (No plan for tourism development in district level) Opportunity Threat • There are tourism development • Lack of fund for local government plan policy for the provincial level to invest in tourist place • There are some potential tourist development places to develop such as waterfall, • Air pollution in sugarcane reservoir and cultural event and harvesting season, which detract products tourist environment.4.4 Problems and Potential Analysis of Non-Agriculture SectorThe problems analysis of non-agriculture sector comprised of the problems of all sectorsrelated to non-agriculture namely Industry, Trade and Commerce and Tourism in KhokCharoen district. The problems were identified through data and information obtained byinterviewing and secondary data. The problems are analyzed the causes and affects whichlink to each other as presents in the problem matrix. This problem matrix table shows therelationship intermediate affects and causes among the problem of each sub-sector. Theproblems ranking were done through the frequency of problem matrix table andprioritized those problems which can facilitate us to finalize the project proposal.However, the problem matrix will follow the problem loop which can clearly present onthe link and connectivity of the immediate cause and effect of various problems. 178
    • The problem matrix is shown in the Table 4.26. The table contains of 8 mains commonproblems of non-agriculture sectors in Khok Charoen district. Specific problem whichhas cause and effect to another was shown by the cross mark to present the link to thatparticular to other problems. These cross mark help us to count the frequency of the linkand the problem are ranked accordingly. Thus, the high ranking problem provides us torecognize many problems link to this high ranking problem. The main problem related tonon-agriculture sector in Khok Charoen consisted of two problems which has equalranking named limited market channel and market opportunity for local products andlimited collaboration among various weaving groups.The most important problem is limitation of collaboration among various weaving groupscauses of three other problems mentioned in the matrix named shortage capital oninvestment, this because of any fund provided by TAO is only for well group ofproduction, any individual producer can not apply for the fund. Another problem isLimited market channel and market opportunity for local products, this because of the limitationof collaboration among groups of producer, they are facing problem on marketing, the mostimportant is marketing channel where the group can sell their products. Finally, the limitationof collaboration decreases level of income due to increasing price of raw materials, butlow price on selling because of they have less bargaining power to negotiate with supplierand buyer.Then, limited market channel and market opportunity for local products causes another threeproblems named decreasing level of income generated from OTOP products due to the saleproblem, lack of market channel producers cannot sell their products. Another followingproblem is shortage of capital for investment, this meant capital from individual saving whichgenerate from their products sale. Finally, limited market channel and market opportunity forlocal products causes low number of local entrepreneurs (OTOPS, shops, services, smallbusinesses) due to the weak marketing, the local products cannot sell thus numbers of producershave to stop their production that why only few of producers can operate recently.The problem loop is drawn regarding on the basis on problem matrix (Figure 4.25). Theproblem loop diagram is well presented the relationship and link among those problems.In the diagram of problem loop shows that the two focused problems are collaborationamong various weaving groups and limited of market channel are link to each other.Regarding to the flow of arrow which present the cause and effects relations, the limitedcollaboration among various weaving and others production group is the main cause ofother problems. However, the limited collaboration among various weaving groups is thecauses of three problems; the important problem which is caused by the limitedcollaboration is limited marketing channel for local products especially weavingproducts. The two main problems mentioned above cause both shortage of capital forinvestment and decreasing level of income generation from OTOP products, and then theless number of local entrepreneurs was caused by limited market channel and shortage ofinvestment. There are two existing problems named no permanent market and increasingprice of raw material and transport cost causing market channel and decreasing of level ofincome respectively. In addition the problem which independently is lack of touristattraction and activities. 179
    • 4.5 Conclusion and Recommendations4.5.1 ConclusionA conclusion on the potentials and problems of Khok Charoen district will be presentedaccording to each sub-sector. The main strength of Khok Chareon lies in the ruralindustry, or more specifically in the form of weaving production. The majority of thepopulation is migrated from Northeastern area of Thailand, in which they bring with themindigenous knowledge and artist expertise in weaving production. Currently, there are atleast 400 people participating in weaving activities showing there are enough skilledworkers to expand the capacity of production. The quality of weaving products here is ofvery high quality and many of these products have been given OTOP status. In addition,10 weaving products have been given 4 or 5 stars (max. 5) for their quality; this issignificant as there are only 72 products in Lop Buri which have been given this status.It should also be mentioned that Lop Buri lies in zone 3 in the criteria established by theThai Board of Investment (BOI). With this, comes a maximum benefits in terms ofimport duty and tax exemption and thus an industrial unit set up in Khok Chareon willgain an economic advantage over those set up in other geo-economical zones. Currentnational and provincial strategic aim has also emphasized on the development of agro-processing industry. This can be interpreted as strength of Khok Chareon as the majorityof the population is already employed in the agricultural sector and the district has seenhigh yield in products such as paddy, sugar cane, and cassava. The agricultural inputscan thus be used as input materials to facilitate agro-processing industries.However, there are many weaknesses in the industrial sector. Despite the quality ofweaving products in Khok Chareon, there are limited market channels and opportunitiesto sell the products, hence the low recognition of Khok Chareon brand of weavingproducts. From the study, it was clear that members of these weaving groups lackentrepreneurship skills and consequently they rely on middlemen coming to purchasetheir products. To make problem worse, some groups even rely on the same middlemento provide them with raw materials necessary for production. Thus despite the quality oftheir products, their income from this has actually been decreasing. To illustrate this, theincome generated from OTOP products in Khok Chareon district has decreased byaround 7% between the years 2006-2007. This weakness can also be used to describe thesituation of other groups such as handicraft. Through interview of staffs from district andTambon office, we have also found that there is limited collaboration among variousoccupational groups performing similar activities. Thus there is no process for the groupsto learn from the mistakes that other have already experienced in their businessoperations. In addition, it should be raised that there is an inadequate level ofinfrastructure to set up a large scale industrial unit in Khok Chareon. From field visit to alarge sugar factory in nearby province (Sri Thep, Petchabun), we have found such scaleof industry requires a lot of water and electricity in their production and maintenanceprocess. It is also dependant on a large road network for transportation of their products;this is however not sufficient in Khok Chareon. 180
    • In terms of trade and commerce, there is no parameter which can confidently be regardedas strength. Nevertheless, the number of activities in this sub-sector is fair consideringthe level of development of Khok Chareon district as a whole; with an average of oneretail shop (groceries shop) serves nearly 100 persons and one agriculture input shopserves more than 4,800 persons. The weakness in this sub-sector, however, lies inshortage of capital of investment. This may due to the fact that the local population hasno land title to their property as the area is located in reserved forest area, thus they lackthe collateral necessary to obtain medium and large loan. In addition, there is nocommercial bank in the area (only mobile bank available), adding another constraint tothe local entrepreneurs in terms of obtaining and managing fund. Another weakness isthat there is no permanent market in the area; this limits the level of trading activities.The tourism sector can be seen as the weakest sub-sector in the area. It would not be anexaggeration to say that there are no tourist activities and currently the number ofrecorded visitors in the area is zero. There is no real strength here but perhaps one mayargue that Khok Chareon has a yearly rocket festival, a northeastern tradition, which canbe promoted as this is something that other nearby districts and provinces do not have. Itshould be mentioned that although the lack of visitors is clearly a weakness of KhokChareon district, it does not have much impact on the local population who traditionallyrely on agricultural activities anyway.4.5.2 Recommendation • IndustryIn conclusion, it can be seen that the strengths and weaknesses of the non-agriculturalsectors are most evident in the industrial sector. Therefore a recommendation should bebased on improving its strengths and correcting its weaknesses. One suggestion is to setup a weaving cooperative centre. The rationale behind this is to get members fromvarious weaving groups to cooperate and assist each other in the production andmarketing process. Acting as a group can help channeling financial supports from localadministrations and this money can be used to provide loan to members to facilitate themin the purchase of necessary raw materials and machines. This will to an extent reducethe problem of capital of investment as well as the role of middlemen (who previouslysupply them with raw materials). The centre can also be used as a demonstration andlearning centre. This can promote cultural tourism in the area and in turn help to marketweaving products in itself. Working as a group will also allow Khok Chareon’s weaversto gain an economy of scale, increase their market power and allow them to compete withother larger producers such as those in Ban Mi district. • Trade and CommerceKhok Charoen has potential in local unique products such as weaving product; this can bepromoted through support by well functioned market. Thus, local government should incharge of provide marketing support by expanding markets of weaving products.Marketing team should be formed to handle this particular job, and make use oftechnology information that district has been developed. Meanwhile strong collaborationof weaving groups and other kinds of production group should be maintained. In addition, 181
    • credit access and credit use need to be improved particularly the properly use of loanobtained. • TourismBased on potential, cultural tourism could be promoted as one activity because there are22 weaving groups in Tambon Khok Charoen and these groups have indigenousknowledge in weaving and their weaving products have unique design and pattern offabric which awards 5 stars. This proposal is needed to promote and maintain localcultural and tradition of doing weaving by training centre. This activity could bedeveloped as one activity for cultural tourism in Khoh Charoen district so the local canget additional income and the skills and culture could be passed to young generation.Local government enables regional market and provides visitors information throughexisting information technology systems which has been developed in the district.Meanwhile, other facilities such as hotels and restaurants should be promoted throughprivatize or public partnership. 182
    • CHAPTER V INFRASTRUCTURE SECTOR5.1 IntroductionLop Buri province is located in the central part of country approximately 150 km fromBangkok. It consists of 11 districts and Khok Charoen is the northern most district of theprovince. Total area of Khok Charoen is 514 km2. There are 5 Tambon mentioned in themap. Administratively district is divided into 5 Tambon Administrative Organizations(TAO) one in each Tambon and District Administrative Office (DAO) look after all theseTAOs. DAO performs intermediary role passing on national policies/information toTAOs and sending feedback of the implementation received from TAOs to provincial aswell as central government.As we know that infrastructure plays key role in development process; it eases andfacilitates to conduct different development activities effectively. It is normally to see thedevelopment situation first whether infrastructure of the area is sufficient or not. Thedifferent parameters with indicators mentioned below have been used to analyze theinfrastructure situation in Khok Charoen.Parameters and indicators: following six parameters have been adopted to analyze thesituation. The respective indicators of each parameter are mentioned here as under. • Settlement Demography and population distribution, Connection network: Time distance and accessibility, Development level analysis of settlements based on NRD-2C data, and Policy and potential are included as indicators to analyze settlement. • Road Network Type and density of road, Distribution of public facilities and services, Durability, Construction and maintenance and Policy and potential have been considered as indicators to analyze road network. • Public Transport Facilities Public transportation (Bus), Private transportation and Policy and potential are the major indictor to analyze transport situation. • Water Supply System Capacity of water sources, Water supply installation cost, Operation and Maintenance and policy and potential are the indicators for analyzing water supply system. For further clarification once case study has also conducted • Power supply system Provision of service, purpose of use, number of households benefited, alternative energy sources and Policy and potential are the indicators based on which the data is analyzed. • Telecommunication Telephone networking, telephone operation and maintenance, fax, internet, postal service, community information service, satellite communication and cable TV 183
    • Distant and policy and potential are the indicator to analyze the data related to this parameter.5.2 SettlementMostly the distribution of settlement in district Khok Charoen is uneven mainly due toscattered population of different villages in all five Tambons. More or less every Tambonhas similar kind of settlements and facilities. The settlements along with population havealso been reproduced on below map 5.1.Map 5.1: Settlement Pattern of Khok Chareon 184
    • 5.2.1 Demography and population distribution:Demographic data is the first need to analyze the development progress of any area.Population size is one of the most important indicators of the data set used fordevelopment planning. Therefore as per given population data, at first population density(person/ sq. km) of each Tambon have been calculated that is given in the Table 5.1 andmap 5.2 and map 5.3 respectively.Table 5.1: Population Density and Settlement Pattern of District Khock Charoen No. of Population Pop. Density HHs sizeTambon Area (km2) No of HHs Villages (person) (sq. km2) Person/HHKhok Charoen 12 120 7,580 63 2,114 4Yang Rak 12 97 7,679 79 2,166 4Nong Makha 12 134 3,158 24 570 6Wang Thong 9 75 2,631 35 862 3Khok Samae San 8 87 3,516 40 808 4Total 53 514 24,564 48 6,520 4Source: Secondary data; DAO and TAOSimilarly, the bar figure 5.1 give below shows the comparison between the sizes offamilies (person/ household) in each Tambon. Figure 5.1: Size of Household Size of HHs (Persons/Household) 8 7 6 6 4 4 Number 5 4 4 3 3 2 1 0 Khok Yang Rak Nong Makha Wang Thong Khok Samae Charoen San Tam bon 185
    • Map 5.2: Population density of Khok Charoen districtMap 5.3: Population distribution 186
    • 5.3 Connection network: Time distance and accessibilityTime needed to reach major settlements in every Tambon is calculated on the basis ofspeed limit. Although local public transportation facility is rare yet motorbike is themajor mode of transportation in the district. Therefore, the calculated time distance toaccess the services inthe table 5.2 is based on average speed of the motorbike and by foot. The every majorsettlement in the district is accessible in 6-20 minutes by motorbike and 80-188 minutesbyfoot in redial.Table 5.2: Average timeSource: Land use map, khok Chareon district5.3.1 Type and density of road:Road network consists of four categories. Major highway connecting different districtspasses through four Tambons with its length 27km. Other three categories: asphalt,concrete and gravel/earthen roads connect all five Tambons to each others and link to themajor services available in every Tambon. Total length of asphalt category is 124.81km,while concrete and earthen categories are lengthening 45.63 km and 209.55 kmrespectively that are shown in map 5.4.Map 5.4: Road network 187
    • The road density is calculated by considering the total length of all four categories existing in each Tambon. Table 5.3 shows the detail for each Tambon. Table.5.3: Roads density Types and Quality of Roads and Density Asphalted Concrete Gravel/Earth Tambon Total Area Designed Designed Designed Length Density Length Density Length Density (km 2) Speed Speed Speed (km) (km/km2) (km) (km/km 2) (km) (km/km2) (km/ hr) (km/ hr) (km/ hr)Khok Charoen 120.24 28 90 0.23 15.00 60.00 0.12 78.00 40.00 0.65 Yang Rak 97 31 90 0.32 0.00 0.00 0.00 40.00 40.00 0.41 134 49.81 90 0.37 20.00 60.00 0.15 30.00 40.00 0.22Nong Makha 75.3 19 90 0.25 4.93 60.00 0.07 48.85 40.00 0.65Wang ThongKhok Samae 87.45 24 90 0.27 5.70 60.00 0.07 12.70 40.00 0.15 San Total 514 151.81 1.45 45.63 0.40 209.55 2.08 Also cumulative road density shown in Table 5.4 is calculated on the basis of total road length of each category. The volume of transport on major roads has been elaborated on flow map on map 5.5 that is attached as annexure 5. Table 5.4: Cumulative road density Total area Total road Density(km/ Volume of Tambon (km2) length (km) km2) Transport/day Khok Charoen 120.24 121 1.01 200 Yang Rak 97 71 0.73 100 Nong Makha 134 99.81 0.74 500 Wang Thong 75.3 72 0.96 180 Khok Samae San 87.45 42.4 0.48 150 Total 514 406.21 3.92 1130 188
    • Map 5.5: Flow map5.3.2 Distribution of public facilities and servicesSchools, public health station, local market, Tambon Administrative Organization (TAO)and police station are the services and facilities available at each Tambon level, whiledistrict hospital, post office and District Administrative Office are present at district level 189
    • to support the Tambons. These facilities have been drawn on map 5.6. All aforesaidservices are well connected to the whole community through asphalt road and easilyaccessible to every village as well as to the adjacent Tambons and these also have beenshown on accessibility map 5.7.Map 5.6: Distribution of Facilities 190
    • Map 5.7:Accessibility of facilities Table 5.5: Accessibility to facilities The average distance from settlements to facilities (km) Tambon Health Police Local Local District District TAO School care Station Post Temple Market Hospital Office Office centre Local OfficeKhok Charoen 1.5 NA 6 6 6 4 6 6 1Yang Rak 1.2 10 4 27 27 10 10 10 1.35Nong Makha 2.25 11 11 16 16 11 11 11 1.25Wang Thong 2 12 8 8 8 12 8 16 0.75Khok Samae San 1.5 6 6 8 8 6 6 6 1 Source: Topographic Map of Thai Survey Department 5.3.3 Construction and Maintenance Regular maintenance of existing roads is needed to serve the function properly. In most of the Tambons more budgets is allocated for the construction of new roads as compared to maintenance that is mainly for upgrading of the earthen road category to either 191
    • concrete or asphalts one. It can also be seen from below graph where construction budgetis more; the proportion of maintenance budget is less then half of the construction. Theallocation of the budget for maintenance and construction was not based on specificformula rather it was on need basis. Table 5.6: Construction and maintenance Construction Maintenance Development Total road Unit Total units Level (Alfa Tambon length Annual Annual (km) Cost (m2) to be Cost/km and Beta Budget Budget (M2) constructed analysis)* Khok Charoen 121 4,000,000 280 14,286 1,200,000 9,917 1 Yang Rak 71 4,000,000 280 14,286 1,500,000 21,127 2 Nong Makha 100 2,000,000 280 7,143 500,000 5,010 3 Wang Thong 72 3,000,000 280 10,714 780,000 10,833 5 Khok Samae San 42 1,000,000 280 3,571 500,000 11,792 4 Total 406 14,000,000 - 50,000 4,480,000 - Note: The width of the road is 5 m, therefore 5000 units are equal to 1 km * Alpha and Beta are the techniques to measure the development level of road network. These are calculated by using the following formulas: Alpha ( ) = (E-V+G) X E= link or edge between a pair of nodes 100 2V-5 V= Node or vertex Beta ( ) = E/ V G= Constant =15.3.4 Policy and PotentialPolicy for road network mainly focuses to provide maximum connectivity and interlinkcommunities through better road network. Farm to market road is one of the top prioritiesto enhance and facilitate business by interlinking peripheral markets. Regularmaintenance and up-gradation of the existing different category roads is also main part ofthe policy.5.4 Public transportation (Bus)There is no local bus facility in any Tambon. Normally transit transport (Bus) comingfrom nearby districts serve the function and connect the major markets in anotherdistricts. The frequency of these buses is 2-6/day in different Tambons. Inhabitants of thearea were seriously concern about lack of bus service and considered one of the mainproblems in the locality.5.4.1 Individual transportationOwing to none availability of public transport, people use individual different kind oftransport in most of the Tambons. The different modes of the individual transport/100households have been elaborated as under in Table 5.7. 192
    • Table 5.7: Individual transport Motorbike Truck Pick up Trollyes Tambon No No No No No Total Total Total Total Total /100 /100 /100 /100 HH No. No. No. No. vehicle HHs HHs HHs HHsKhok Charoen 2,114 1,700 80 10 0.47 170 8 10 0.47 1,890Yang Rak 2,166 1,950 90 12 0.55 758 35 20 0.92 2,740Nong Makha 570 1,100 193 20 3.51 550 96 50 8.77 1,720Wang Thong 862 700 81 20 2.32 300 35 3 0.35 1,023Khok Samae 808 808 100 10 1.24 80 10 75 9.28San 973 Total 6,520 6,258 72 1,858 158 8,346Figure 5.2 Individual transports Individual Transport /100 HHs 193 200 180 160 140 Vehicles 120 100 90 96.49 100 80 81 80 60 35.00 34.80 40 8.04 8.77 9.90 20 0.47 0.47 0.55 0.92 3.51 2.32 0.35 1.24 9.28 0 Motorbike Khok Charoen Yang Rak Nong Makha Wang Thong Khok Samae San Truck Tambon Pick up Trollyes5.4.2 Policy and PotentialAlthough clear-cut public transport policy could not be found yet district as well asTambon administration aims to improve public transport facilities on priority basis. Thedistrict administration has serious concern, and is regularly discussing with responsibleauthorities in this regard.5.5. Water Supply SystemDomestic water is the basic element of life and for social uplifting of the society.According to the current government policy, water supply for domestic use is providedon the basis of one Water Supply System (WSS) for each village. To following WHOstandards for domestic use, the analyzed data confirms water availability accordingto/more than the standard. 193
    • Table 5.8: Water availability Availability Capacity Tambon Name Population of water Meeting WHO standard(%) Available (lit.) (lit/c/d) Khok Charoen 7,265 510,000 70 100 ( = WHO standard) Yang Rak 7,794 630,000 81 115 (15 % > WHO standard ) Nong Makha 3217 390,000 121 173 (73 % > WHO standard) Wang Thong 2639 630,000 239 341 (241% > WHO standard) Khok Samae San 3491 360,000 103 147 (47% > WHO standard) Total 24,406 2,520,000 Note: WHO standard for domestic water use is 60-70lit/capita/day The figure 5.3 is showing the quantity available according to the standard in every Tambon. Figure 5.3: Availability of water Availibility of water (lit/c/d) 280 239 Amount of water 210 140 121 103 70 81 WHO Standard 70 0 Khok Yang Rak Nong Makha Wang Thong Khok Samae Charoen San Tambon 5.5.1 Case study: The case study was done in village no. 12 namely “Romklao Pattana” of Tambon Yang Rak to assess and evaluate the operation & maintenance (O&M) and overall management of WSS, and level of participation of the community in the project. Table 5.9 gives the over all picture and understanding of O&M of the different components of the WSS. Table 5.9: Case study Authority to No. of WSS connection Investment per System Population from WSS Source of (M 3/day) No. HHs maintain supplied mange / No. of Responsible Agent Water Fund WSSVillage Water Supply System (WSS) Charges Connection TAO/Local (bath/M3 ) Cost/HH Leaders 194
    • (bath/M3 ) Cost/HH Leaders 13 members head ofRomklao of Water TAO/ Water User 741 186 1 60 192 350,000 5 400 Pattana Use Group community Group (WUG) (WUG) Source: Primary data from village No. 12 in TambonYang Rak Functioning of the system was studied thoroughly and following steps are involved in running the system, • WSS is direct pumping system • Each Household has own storage that is sufficient for two days • Frequency of pumping is two times per day, i.e. in morning & evening • Water table in the area is 40-50 meters • Quality of water was reported satisfactory (Public Heath Officer) While for maintenance: • Two hired technicians are responsible for regular maintenance • Miner maintenance is done from the saving of WUG • For major maintenance TAO is responsible 5.5.2 Policy and Potential For water supply for domestic use, “one village one water supply scheme” already exists and it would be followed in future as per need. Identifying catchments areas to construct more water storage structures is another policy priority to improve the irrigation system. But policy for drinking water keeping in view NRD 2C indicator and the ground reality is not understandable. 5.6 Power supply systems Power supply was observed as a major indicator that have already achieved the ultimate development level in every Tambon. All villages have been electrified either by power supply or solar energy. 100 percent of NRD-2C target has been achieved. Table 5.10 shows overall percentage of electrification in each village of every Tambon. It can be observed 97.5 % households have been electrified with power supply and remaining 2.5% household have been provided solar energy. 195
    • Table 5.10: Power supply Village No of HH Electrified Total No. Total No. Tambon Electrified of Village of HHs. Solar (%) Electricity Percentage Percentage EnergyKhok Charoen 12 100 2,114 2008 95 106 5Yang Rak 12 100 2,166 2,145 99 21 1Nong Makha 12 100 570 559 98 11 2Wang Thong 9 100 862 845 98 17 2Khok Samae 8 100 808 800 99 8 1San Total 53 100 6,520 6,357 97.5 163 2.5This solar energy has been provided to those scattered households far flung from theexisting power supply network. The development situation has also been shown in thefigure 5.4. Figure 5.4: Power supply Power Supply 5 1 2 2 1 100 90 80 70 ge 60 ercenta 50 95 99 98 98 99 40 P 30 20 10 0 Khok Charoen Yang Rak Nong Makha Wang Thong Khok Samae San Tam bon So lar Energy So lar Energy No . o f HH. electrified in %5.6.1 Policy of power supply: (According to the documents provided)§ Policy of power supply (Energy Policy and Planning Office, Ministry of Energy)§ Policies on the Promotion of Efficient and Economical Use of Energy§ The Demand Side Management (DSM) Program§ The program is aimed at encouraging the economical use of electricity and reducing electricity consumption. This program has been in effect since 1992. EPPO has continuously supported the DSM implementation by taking the following actions : 1. The campaign to urge the public to use energy saving lighting equipment. 2. The promotion of labeling for energy-efficient refrigerators and no.5 air conditioners (Labeling no.5) 3. The encouragement of government agencies to use energy efficient air conditioners (no.5) and compact fluorescent bulbs on an exceptional basis 4. Power Purchase from Small Power Producers (SPPs). 5. Policies on the Protection of the Environment and Mitigation on the Impacts Resulting 196
    • from Energy Development and Utilization, including the Improvement of Safety standards on Energy-Related Activities 6. Policies on Energy Conservation5.7 TelecommunicationTelecommunication is a necessary part of the consistent development. It provides betterand faster connectivity and helps to gather quick and reliable information in short time.Telecommunication includes different modes of communication that have been shown intable 5.11.Table 5.11: Telecommunication No of Radio Channel announcement tower No of public booth Reading center and No of TV channels No. of News paper No of post offices No. of cell phone No of HH owned Total No. of HH Internet conn. Tambon Post boxes No of Fax / village users TOTKhok Charoen 2,114 7 418 2,761 18 11 1 15 1 2 10 6 Yang Rak 2,166 7 250 2,806 1 3 0 0 1 2 10 6Nong Makha 570 2 114 1,100 4 7 0 0 1 2 10 6Wang Thong 862 7 19 660 6 2 0 0 1 2 10 6 Khok Samae 808 9 44 630 17 1 0 0 1 2 10 6 San Total 6,520 32 845 7,956 46 24 1 155.7.1 Telephone networkingThe bar chart given below shows the number of lane telephones and cell phones per 100household in every Tambon. Figure 5.5: TOT and cell phone 197
    • TOT and cell phone/100 HHs 250 193 200 Number 150 131 130 100 77 78 50 20 12 20 2 5 0 Khok Charoen Yang Rak Nong Makha Wang Thong Khok Samae San No fo TOT /100 HHs Tambon No of cell phone /100 HHsSource: documented by TOT5.7.2 Operation and maintenance:TOT is responsible for operation and maintenance of the lane telephone while individualmobile phone-service offering companies are primarily responsible to maintain theirnetwork under the regulatory authority of the concerned government.5.7.3 Fax and internet:Fax as well as internet is another way of faster and softer communication. Although thesefacilities are limited and available only in different public service departments yetfacilitate the common people too. The number of these facilities is already given in abovetable 5.115.7.4 Postal service:Postal service is an important traditional way of communication on that communitymostly relies to exchange their views, emotions and commodities. The detail is give inabove table 5.11.5.7.5 Policy and PotentialThe new regulatory law of radio, television broadcasting and telecommunications isgoing to be issued in the near future, the country is still in the embryonic transition. Thepurpose of the policy is to promote the private sector participation in the broadcasting andtelecommunication business in hoping that this will result in the healthy businesscompetition in this high technology circle. 198
    • Learning from the successful case of Korean experience, it is believed that the government intervention is important because Thailand does not own its telecommunication technology. Most of Thai telecommunication equipments are imported. Investment in Research and Development in this area is very rare for commercial. More important, this new Broadcast and Telecoms Act does not define clearly on the information technology. The big gap for new laws related to Electronic Commerce and all Internet-related business is still in the brainstorming and discussion that would suggest the new Regulatory Act on Information Technology and Electronic Commerce. It is expected that the high technology business will generate greater revenue to the Government of Thailand and will also give rise to the widespread public interests. 5.8 Overall Development Infrastructure in the district was analyzed on the basis of NRD 2C and BMN to set a benchmark for comparison. Settlements, road network, public transport facility, water supply, power supply and telecommunication were considered as core indicators assessed through three devised NRD 2C levels: backward, moderate and progressive (level 1, level 2 and level 3) respectively. Tambon wise elaboration is given in the table 5.12 Table 5.12: Overall development No. of Level 2 Level 3 Vill Level 1 Tambon (Moder (Progressiv age (Backward) Remarks ate) e) s 2% backwardness is in village 9Khok Charoen 12 2% 31% 67% due to road Over all trend of development is Yang Rak 12 0% 46% 54% from moderate to progressive level. 4% backwardness is in village 3 Nong Makha 12 4% 42% 54% and village 6 due to road and WSS respectively 3% backwardness is in village 8 Wang Thong 9 3% 42% 55% due to communication. 6% backwardness is in village 1Khok Same San 8 6% 28% 66% and village 2 due to communication Source: documented by TOT The pie chart shows overall development in the district based on NRD-2C and it would be compared with the actual findings from field 199
    • Figure 5.6: overall development Dis tric t K hok C haroen B ac kword 3% Moderate 38% P rog res s ive 59%5.8.1 NRD-2C criteria:Road • Roads in all villages are in good condition and accessible whole year.Water for domestic use • Facility of Water for domestic use is available to more then 95% of total householdsPower Supply • Power supply is provided by the government to more than 90% of total households.Communication • Availability of communication facilities more then 10% shows progressive level and less then 10% is moderate5.8.2 Findings Road: Road connectivity is found satisfactory and remains in good condition throughout the year in most of Tambons, and is increasing yearly that confirms NRD- 2C progressive level. Public Transportation Facility: Public transport facility (bus/other mode) has been found unsatisfactory even with having very good road network. Water supply: The minimum amount of domestic water needed per person per day is sufficient and exceeding the WHO standard, and also is much more than NRD -2C set target. 200
    • Power supply: 100% of the villages are electrified either by power supply or solar energy. The target of NRD-2C (100%) has been achieved in every Tambon. Telecommunication: Available communication facilities are mostly limited in the area. Only line phone provided by TOT (Telecommunication of Thailand) and cell phone has achieved progressive level the rest of are lying in moderate level.5.8.3 ConclusionAccording to infrastructure group’s analysis, overall infrastructure situation in the districtis satisfactory and most of the indicators have achieved progressive level. However, someof the components of the indicators mentioned below are needed to be addressed onpriority basis: § Communication indicator lies in moderate level due to IT i.e. internet, fax etc § Limited public transport facility is another constraint in the area that restricts mobility of the inhabitants and in turn increases financial burden.5.8.4 PotentialsImproved infrastructure is necessary to run the development process smoothly, and here itcan provide an opportunity:§ To link farms to central places (markets) through better communication facilities§ To enhance agricultural produce (raw material) to encourage cottage industry in the area that in turn will helps:§ To increase inhabitants’ income with greater accessibility to market5.8.5 Recommendations:Despite the development of infrastructure in progress, some certain limitations need to beaddressed: § Regular maintenance of the existing infrastructures including road, water supply systems, power supply and telecommunication to serve the function properly § Improvement in internet facilities is the utmost need and § Public transport available locally is necessary to enhance the regular mobility of the inhabitants for diverse economic activities. 201