Mermaid Maritime Co., Ltd., a Danish company in Thailand, plans to flag out its three supply ships serving the offshore installations in the Gulf of Thailand if WTO turns down a pending application from Thailand to honour existing incentives offered by the Board of Investment in Thailand (BOI) and the Industrial Estates Authority of Thailand (IEAT).
The incentives offered are subsidy schemes scheduled for final termination in 2013. But if WTO orders Thailand to cancel the subsidies immediately it would affect not only new applications. Businesses already receiving benefits under either of these two agencies would see these incentives removed in the worst scenario over night.
“If his should really happen, we would most likely move our supply ship business out of Thailand immediately,” says Mr. Claus Jørgensen, Financial Director of Mermaid Maritime Ltd..
“We operate three offshore supply ships in the Gulf of Thailand established with BOI support and we have established these operations in Thailand in confidence that these incentives would remain in force for the period of time we have been promised.”
Danish-Thai Chamber of Commerce has together with the Joint Foreign Chambers (JFCCT) raised the issue with the appropriate Government authorities as an urgent matter.
Thailand has asked WTO for permission to extend the export subsidies to be able to continue giving privileges to the firms which have applied for and received these incentives before the amendment in 2001 of the regulation, which phased out the available tax incentives and other benefits offered.
Currently, the incentive promised to each beneficiary has a timeframe. The final year of BOI support will be 2013. The amount of the incentives, calculating from the decrease of tariff reduction rates, are gradually to be reduced until finally phased out in the year 2013.
Thailand has argued that an immediate discontinuation would create a lack of confidence in government developmental plans and endeavors, as well as not offer the beneficiaries of the program the needed time for appropriate adjustments.
