Thai Tobacco Monopoly Told to Sell Part of Retail, Print Units (fwd)

[Robert Weissman <rob@essential.org>]

Thai Tobacco Monopoly Told to Sell Part of Retail, Print Units
Date: Wednesday, 6/9/99

Bangkok, June 9 (Bloomberg) -- Thailand said it plans to sell a portion of
its tobacco monopoly's retail and printing units as the country privatizes
some state-owned companies.

The Thailand Tobacco Monopoly now controls all domestic tobacco
cultivation, cigarette production and distribution. It sold about 2.4
billion packs of cigarettes last year, a 90 percent market share.

The Committee on State Enterprise Policy recommended the distribution unit
be turned into a separate company, with an unspecified stake sold to
private investors and the public. The TTM's printing unit and a hospital
in Bangkok which serves staff of the monopoly should also be sold, it
said.

The committee, chaired by Deputy Prime Minister Supachai Panitchpakdi,
didn't give an answer to the timing or extent of the privatization. ``The
major activities such as tobacco production and social and agricultural
functions will (remain) under state enterprise,'' the committee said.

TTM was the government's most profitable company in 1997, the latest year
of published results, earning 4.5 billion baht ($121 million), down a
tenth from 1997.

The state enterprise has been in talks about various ventures for more
than a year with several international tobacco companies, including Philip
Morris Co., RJR Nabisco Inc.'s R.J. Reynolds Tobacco International Inc.
and British American Tobacco Pcl. Thailand levies a 60 percent tax on
cigarette imports.

A broad requirement of Thailand's $17.2 billion credit arranged in August
1997 by the International Monetary Fund was that the government privatize
some of its state companies.

Among agencies the government has said it plans to sell shares in are the
Petroleum Authority of Thailand, Bangchak Petroleum Pcl, Thai Airways
International Pcl and the Electricity Generating Authority of Thailand.

Recent efforts to sell part of the petroleum and electricity agencies have
met with protests by workers amid concern about potential layoffs.

Finance Minister Tarrin Nimmanahaeminda said the aim of selling shares in
state companies is to make them more competitive, not to fill the
government's coffers. He said sales will be done only if the price is
right. ``The kind of money we will be getting is too little and too late
to stimulate (economic) recovery,'' he said last week. ``What we don't
want to do is to sell public assets at distressed prices.''