Thailand’s King Bhumibol remains the world’s richest royal for the third year in a row, despite his country’s riots and turmoil. Royal assets are held under Thailand’s Crown Property Bureau, which benefited from stock market and real estate gains in 2009. As a result, his fortune remains stable at $30 billion, at least for now. The rioting that broke out in March, led by protesters demanding new elections, may irreparably damage the country’s tourism and investment markets.
- Extracted from Tatiana Serafin, “The world’s richest royals”, Forbes, 7 July 2010.
New Mandala coverage of this same topic is available from 2008 and 2009. The comments following those archival posts are also quite interesting. It is helpful, I expect, that we all remind ourselves, from time-to-time, about how debates and ideas have shifted over the years.
What are your 2010 views on King Bhumibol’s billions?
I wonder whether the Forbes article is going to get any traction in Thai press. Is it a safe bet to say it won’t? Or maybe Forbes won’t be seen as a reputed source anymore?
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At least the assets are safe in the Crown Property Bureau from the usual thai style distribution in different pockets of the ones who can. Imagine in any other place the funds would be ‘gone’ by now.
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Most of the CPB’s properties in the Rattanakosin area are being rented out at below market value, or at least that’s the conventional wisdom. Every Thai seems to know someone who knows someone that knows a family that’s been renting the same shophouse near Chinatown since 1962 for Bt1200 a month, etc. So the Forbes number is possibly inflated because it’s using actual market value on the land. Then again, with no accountability or transparency, the CPB could kick out the tenants at any time and turn Rachdamnoen into Orchard Road II. That they haven’t yet suggests that someone up there isn’t entirely greedy. Of course, the head of the CPB will change eventually…
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Hard to add anything to the comments on the same subject made in 2008 and 2009 and that old Asia Sentinel article.
Overall CPB business practices seem to be generally beneficial to the country but that depends largely on their good will and there are no legal mechanisms to prevent abuse of all that wealth.
I’m not sure that introducing such mechanisms would be beneficial, though – if SPB opens their books and doors, who’ll come rushing in first and with what motives?
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The companies owned by the Crown Property Bureau, like Siam Cement, are also among Thailand’s strongest, setting standards in the country’s industrial development as well as employment practices.
Whereas South Korea grew to its present strength on the backs of gigantic Chaebol, conglomerates such as Samsung, Daewoo, Hyundai, Thailand impales itself on the simmering hatreds of a generation of left-leaning academics incorporated into society via the 1979 compromise.
Anyone who has worked as part of these two societies (as opposed to ivory-tower-entrenched hyper-specialized shielded-from-the-real-world cradle-to-grave-in-the-academy academics) knows that these large Chaebol employers have been the road to social equality in South Korea. How many young people who grew up in rural farming households catapulted themselves into corporate workplaces and the middle class through a career in a Korean Chaebol? So many that I remember, that I cannot count them.
So many Thais have been taught to have a knee jerk reaction against anything large and commercial like CP Group or Siam Cement, yet it is only within large corporations like this, that the “welfare state” left-leaning academics so much adore, can be established. Successful agriculture projects are also much more likely when conducted by these commercial for-profit enterprises, rather than the government, contract farming of fish being one notable example.
The quoted phrase is really logically perplexing. Take this logic: “…remains the world’s richest royal for the third year in a row, despite his country’s riots and turmoil…” What is that supposed to mean?
“The rioting…may irreparably damage the country’s tourism and investment markets,” and fish may rain from the sky in the Australian desert as they sometimes wont to do! What an idiotic “so what” sentence. This reminds me of how the Financial Times used to rely on Trotskyite Giles Ungpakorn as a source for political analysis. What utter rot.
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So jonfernquest, give us a shred of evidence for all of your assertions. Anti-intellectualism is no safe haven from providing evidence for beliefs. I trust that you have stopped writing articles published in ivory-tower-entrenched hyper-specialized shielded-from-the-real-world cradle-to-grave-in-the-academy academic journals.
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Regarding CPB rental practice, my parents are among the long-time tenants who have seen the rent increasing each year, without fail. Although the monthly rental is quite low compared to the value of the land or property, they still had to pay a significant sum upfront (the word in Thai, borrowed from Chinese/Taechiew, is “Seng” equivalent to a leasehold I think). After 30+ years I still don’t know to whom that initial Seng money went.
If I’m not mistaken, there is also a court case against the CPB by the tenants in Rajprasong (yes ! that famous area). I don’t recall what was the charge but seems like something to do with wrongful eviction/breach of contract? I’m not sure on this point.
Anyway, CPB seems charitable as long as it is not too ‘expensive’ for them to do so.
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Fernquest,
What’s with all the ad hominem?
You’re not losing the argument again, are you?
I remember you admonishing “non-Thais” for daring to have a view against LM.
Then, in the same posting, you attacked Giles. Who is, unlike you, a Thai citizen.
Oooppps.
A “non-Thai” criticising a “Thai”.
Funny that.
I’ve met plenty in the Democrat Party who are more switched on, more able to comprehend the need to repeal LM and more able to understand that Thailand’s political and wealth distribution needs to be reappraised that you.
If I was you I’d get out more Jon.
Talk to a few more Thais than that group of PAD fanatics and ex-pat fruit cakes who seem attracted to you like flies to … ahem… fly paper.
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Whether the King has $1Billion or $60 Billion is irrelevant, apart from the fact that it emphasises the fact that in Thailand there are those that have “it” and those that don’t. The major economic problem facing Thailand is a lack of investor confidence associated with the unfinished political unrest and the sharp decline in tourist numbers. Despite the beat up by the Thai press the current tourist numbers are dismal. The hotel management, tailors, taxi drivers and whoever you talk to in Bangkok decry the lack of foreign tourists. It is anyone’s guess how long this may go on for but it is hurting so many of the population who depend on the tourist dollar for a living. This of course has a domino effect for all in the country from silk weavers in the north to fishermen in the south.
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Well, I definitely agree that Siam Cement is one of the best-run, most accountable corporations in Thailand. (They also happen to the only Thai stock I own that’s worth more than I paid for it, but never mind…) But I sense an implication from Mr fernquest that the CPB’s 35% (not majority) sharehold of Siam Cement is somehow causal to its excellent corporate practices? I don’t see evidence of that. Equally plausible is that Siam has benefited from its CPB connections to get favorable contracts.
I think the Korean (and Taiwan) examples are very useful for the current general discussion, because they avert the “Western v Eastern” argument, and because both states emerged from military governments into parliamentary systems roughly concurrent to their transition from agrarian-industrial to tech-industrial economies. Why not Thailand? Note that both Korea and Taiwan also have primary capital cities, lots of coastline, and dominant non-state religions. Why not Thailand?
Some cynics would say “the royal family” but I think that’s a limited and myopic answer. The biggest difference is that Korea, Japan, and Taiwan all have a culture of shame to counterweight their culture of face. They’re obsessed with image but the deal is that when you screw up, you fall on your sword. You go on TV, even if you’re the Minister of Finance or the CEO of Hyundai, and you apologize and hang your head in shame and you resign and accept legal punishment. This never happens in Thailand.
Sadly, the best leader Thailand has had in terms of potentially developing Chaebol-like development here and extending the opportunities thereof to the working classes was Thaksin. He always worshiped the Singapore model, but the Korea one was always the better bet. His corruption, cronyism, and legacy-egotism would have also fit the Korean/Japanese model for mega-business insider dealing. But the absence of a Thai culture of shame/accountability/justice would likely have derailed it anyway.
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May be even more interesting may be the annual contribution of the taxpayer to the royal houshold. As far as I remember it was about 120 Million US-Dollar, if one include the helicopter services (excluded the Airplanes which are under Thai Airforce) May be someone has more reliable information.
And now we remember, that the Military in Thailand says, the first and most important task to fulfill is to protect the monarchy. This means, that a big part of the military budget needs to be taken into consideration too. So the question should not be how much the royal family “owns”, because most of it is not the personal wealth of the royal family, but the royal family is only taking care of it because it belongs to the country, and need to be given back to the country one day, but how much the royal family costs the country per year.
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John Fernquest: “So many Thais have been taught to have a knee jerk reaction against anything large and commercial like CP Group or Siam Cement”
They have? By who exactly? Sounds very different from the education system I know about.
I like the idea that Siam Cement are “setting standards in the country’s industrial development”. Is that what they were doing at Map Ta Phut?
And out of the seven projects allowed to continue there, six belonged to Siam Cement. Yup, that was an eductaion all right.
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@ Sebastian
http://us.asiancorrespondent.com/bangkok-pundit-blog/2008/03/expenditure.html
BP shows us the royal expenditure from taxpayer for 2008 is 6 billion baht.
Interesting comparison to make is to Thailand’s top 40 richest people from forbes
http://www.forbes.com/global/2006/0724/045.html
The net worth of the 40 richest people in Thailand is $20 billion as of 2006. Only $ 10 billion behind the royal conglomerate, does anyone else get the impression that maybe the odds are tilted slightly in the favour of the CPB, when it comes to making money in Thailand.
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WLH – 10
CPB’s 35% (not majority)
There are many nominees that hold the share in the name of CPB; SCB (0.76%)and Royal Treasury (1.29%) for example. Moreover, with free float standing at 67.86%, owning 30% shares is as good as owning majority actually.
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@jonfernquest Your analysis using Korea as a comparison is hallucinogenic as a benchmark and furthermore your reasoning is so politically biased that you do a great job of impaling your own argument.
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On of the many problems with lèse majesté law is that the relation of dynastic succession and the huge wealth of the CPB cannot be openly discussed. As far as I know, even discussing the annual report of the CPB (if you could get a copy) would be a crime.
It is certainly a topic worth exploring in New Mandala-land.
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Most of the wealth seems to be in property, but would be interesting to know whether the SCG share price factors in the potential time bomb of asbestos related compensation claims, or is it considered at no risk because of who the shareholders are?
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Are there any real asbestos issues for Siam Cement? This issue comes up about once a year.
Has any Thai listed company ever suffered a significant valuation impact from liabilities? I know Kamol Sukoson (or similar) did have some issues related to throwing out nuclear waste with the regular trash, but they still seem to be doing fine.
I do know that a large number of analysts cover Siam Cement (SCC) for big international banks and have never seen one mention asbestos liabilities as a serious concern.
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