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20120905 who will own the forest portland oregan   andrew steel

20120905 who will own the forest portland oregan andrew steel







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  • & years operating successfully across a number of areas in the forestry sector primarily in Thailand & SE Asia
  • Gateway to AsiaHub Of Asean Social & political StabilityGrowing EconomyWorld Class InfrastructureFDI PoliciesGovernment Support Incentives
  • Leading to UN FAO Research
  • http://en.wikipedia.org/wiki/2011_Thailand_floods Govt 350 Billion Baht
  • Forestry & Timber conversion 80% of investment coming from overseas can apply (Contradiction on land ownership – CHECK WITH STEVE)
  • Forestry & Timber conversion 80% of investment coming from overseas can apply (Contradiction on land ownership )
  • FIO Website ALL in Thai – not condusive Google translate ???
  • http://www.boi.go.th/index.php?page=opp_rubber
  • http://www.boi.go.th/index.php?page=opp_rubber
  • Oud Oil & Agar Oil
  • Shooting export volume : Surging exports over 102.7% per year to support the global growing demand from Y2005 to Y2009. Premium grade oil : Thai oud oil, mostly from Aquilaria Crassna, is highly appreciated by the Middle East customers from Saudi Arabia, Bahrain and U.A.E, covering almost 100% of the export volume from Thailand.

20120905 who will own the forest portland oregan   andrew steel 20120905 who will own the forest portland oregan andrew steel Presentation Transcript

  • WHO WILL OWN THE FOREST? 8 PORTLAND, OREGAN‘‘Investing in Frontier Markets: Risks, Obstacles andOpportunities - THAILAND’’ ANDREW G. STEEL Chief Executive Officer THE TREEDOM GROUP andrew.steel@treedom.com Michael Young, CFA. Treedom Investments
  • - Investment Advisor to the Asia Renewable Resources Fund- Forestry Consultancy & Project Management- Plantation Management & Luxury Aromatic OilManufacturer- UK Charity & Thai Foundation: Charitable Objectives;Reforestation & Environmental Education
  • THAILAND – Overview
  • MACROECONOMICS Facts about Thailand Population (2010) 66 million ASEAN Population 600 million GDP (2011) US$345.6 billion GDP Growth (2012, projected) 5.5-6.5% Export Growth (2011) 16.4% Corporate Income Tax 10-23% Value Added Tax 7%http://www.boi.go.th/index.php?page=macroeconomics
  • Why THAILAND?Abundant resources: Largest producer of natural rubber.Strategic location: Asia-Pacific has the world’s highest rubberconsumption growth rate.R&D: spends more in this area than Malaysia and Indonesia.Infrastructure: offers an ample water supply, a low incidenceof power outages, and reliable transportation, ensuringsmooth manufacture and exporting.Free trade agreements: already negotiated reduced tariffson rubber products with China, ASEAN countries, Australiaand New Zealand. Launch of the single-market ASEANEconomic Community in 2015 with 600 million consumerswill open greater trade investment opportunities.Workforce: labour is more cost-effective than in Malaysiaand Indonesia. There is a wealth of highly skilled personnel.
  • Why THAILAND? World Bank Ease of Doing Business 2012 Every year, the World Bank conducts a study of Ease of Doing Business in countries around the world, which looks at domestic and medium- sized enterprises and quantitatively measures regulations affecting them, covers nine indicators for 183 economies. Ease of Doing Business 2012 ranked Thailand #17 in the world, placing in 4th in Asia. In fact, government approval to invest in Thailand is not even needed unless the special incentives offered by the Board of Investment are being applied for, and most sectors of the Thai economy are open to foreign investors. Source: http://www.doingbusiness.org
  • THAILAND – Risks  Force Majeure:  Legal:  Land Classification:  Obstacles/Challenges:
  • THAILAND – Floods2011
  • Legal StatusBoard of Investment (BOI):Restricted Business Activities under the Foreign Business Act of 1999List 1 – Businesses that foreigners are not permitted to engage in for special reasons: – Newspaper business, radio-broadcasting station or radio/television business. Farming, cultivation or horticulture. Animal husbandry. Forestry and timber conversion from natural forests. Fisheries, especially fishing in Thai territorial waters and in specific economic areas of Thailand. Extracting Thai herbs. Trade and auction sale of Thai antiques or objects of historical value. Making or casting Buddha images and alms bowls. Trading in land.
  • Thailand: LegalCompany Set up:- without BOI approval: 51% Thai ownedentity: Foreign ownership is limited to49%However: If Land ownership requiredForeign ownership is limited to 39%BOI Company: can own land.... 80% ofsales coming from overseas“BOI overrides Company set up & Land ownership rules andcan be applied for retrospectively “
  • Land rights and landdocuments in Thailand CLASSIFICATIONS Land Sor Kor Nung (1) - Notification form of possession of land and has little real rights associated with it  Nor Sor Song (2) - Entitles the holder to occupy and use the land for a temporary period of time  Nor Sor Saam (3) - The N.S.3 is a title deed which shows a persons right to possess a certain plot of land, but the land borders must be confirmed with neighboring plots.  Nor Sor Saam (3) Gor - boundaries of the land are defined and the land is accurately surveyed in relation to neighboring land areas  Nor Sor Saam (3) Khor - surveyed and issued in an area which has no parcel points set by using an aerial survey. Nor Sor Si (4) Jor (Chanote) - certificate of true ownership for land and the only true ownership land title deed. Nor Sor Ha (5) - along with a utilization certificate it indicates that the district officer has confirmed the utilization on the land Documents issued by other Govt Departments Sor Por Gor. 4-01 - Allotment of land from the land reformative committee Sor Tor Gor - Land certificate issued only in the zone of national reserved forest. The holder of this document has the right to reside and live on the S.T.G. land Por Bor Tor 5 - Evidence showing that the occupier of a plot of land has been issued a tax number and has paid tax for using and the benefit of the land Nor Kor 3 - Utilization certificate issued under the Act of Land Allocation for Living B.E. 2511 (Self Help Settlement) Gor Sor Nor 5 - Utilization certificate issued under the Act of Land Allocation for Living B.E. 2511 (Cooperative)
  • THAILAND –Obstacles/Challenges Culture/Language Workforce (Visa issues) Border Areas Lawyers (Thailand 1st, Clients 2nd) Corruption – doesn’t exist!  Commission culture does – Tax deductable!
  • Reasons LimitingInvestment in Asia1. Risks: - Land title concerns - Political/bureaucracy - Due-diligence - Liquidity2. Lack of opportunities3. Lack of expert and proven forestry asset managers4. Perceived lack of industry infrastructure5. Wider rejection of illiquid assets due to market concerns•Developing_of_a_guideline_for_incorporating_the_interests_of_investors_into_National_Forest_Financing_Strategies_in_the_Asian_Region_v1.1.pdf•Expert Group Meeting, "National Forest Financing Strategy", 28-29 August, 2012, FAO-Bangkok, Thailand
  • THAILAND – Opportunity RUBBERAttractive Investment IncentivesThe Board of Investment has classified the manufacture of natural rubber and rubberwood products as a priorityactivity. As such, projects receive an eight-year corporate income tax holiday and are exempt from import duties onmachinery.
  • THAILAND – OpportunityAQUILARIA Niche Market Product Thailands 2nd Largest Producer of Oud Oil 7.38 % Market Share (Thailand) 0.15 % Global Market Share Working with 4 Major Global PerfumeHouses
  • Oud Oil:Wholesale Market
  • 25. Global Imports v Export World export : Growing demand in Oud oil Kilograms 2,000 United Arab Emirates Singapore Malaysia 1,529 • World export increased by 87.7% 1,500 Thailand 134 from Y2005 to Y2007. Total 253 1,000 851 371 • Thailand is the worlds top exporter 91 434 189 enjoying the highest market share of 500 114 182 145 11 435 754 51.1% in Y2006 and 49.3%in Y2007. - 97 World import : Middle East - the major oud oil consumers Kilograms 2,000 Others Bahrain United Arab Emirates 1,571  World import surged by 92.5% from 1,500 96 Saudi Arabia 244 Y2005 to Y2007. Total 1,000 880 536  Most of Oudh importers are located 53 112 in Middle East region, namely Saudi 424 287 500 7 11 1 695 Arabia, U.A.E and Bahrain, covering 405 428 more than 90% of world import - volume. Source : www.cites.org
  • Thailand:Oud Oil ExportsThailand: No. 1 exporter globally - both quality & volume Kilograms 1,800 Others 1,627 1,600 U.A.E 51 Source : www.cites.org Bahrain 1,400 Saudi Arabia 548 1,200 Total 972 1,000 6 754 118 800 419 18 244 600 434 184 2 183 400 36 96 112 604 608 200 2 369 1 284 10 0 83
  • THANK YOU ANDREW G . STEEL Chief Executive Officer The TREEDOM Group andrew.steel@treedom.biz