Business

BANGKOK (The Nation): Soon to be Thailand’s newest carrier, Krabi Airlines is now being set up and plans to begin flight service to international destinations starting on November 1, just in time for the start of the 2007-2008 high season.

Civil Aviation Department Director General Chaisak Angkasuwan said the airline, with four investors, including former Thai Airways International employee Kosol Vongsrisart, plans to fly to Norway, Germany and Australia by the end of the year.

The carrier intends to add flights to cities in the US and Japan within five years, he added.

K. Chaisak said the establishment of the airline, which takes advantage of Krabi Airport’s upgraded international status, would be completed very soon.

It will be the first fully scheduled airline using it as a base of operations, he said.

At first, the airline will service two international routes: to Oslo and Munich.

In the second phase, between this year and 2009, the airline plans to fly to Sydney, Melbourne and Brisbane in Australia, plus one city in New Zealand.

K. Chaisak said the airline would use two Boeing 777-200ER aircraft in its first year, increasing the number of aircraft to five within five years and up to 10 by 2013.

The airline, targeting tourists from Europe as its main market, expects to run an average cabin factor of at least 70%, he said.

Over the longer term, starting in 2011 the airline plans to expand its routes to Vancouver, Canada; Los Angeles and San Francisco, California; Tokyo and Osaka in Japan; and Seoul.

Meanwhile, Thailand’s open-skies policy is key to encouraging investors to start an aviation business.

K. Chaisak added that more than 10 airlines were in the process of being established. Each is required to have a minimum 200 million baht in registered capital.

Most are intending to serve Asian markets, he said.

Five major hotels to be re-branded

Patong’s Grand Tropicana Hotel is to become the Courtyard by Marriott Phuket at Patong Beach.

PHUKET: Three Phuket hotels will be renamed under the Central Group’s re-branding of its hotel and resort business, while another two will be taken over by the Marriott chain of hotels.

Central Karon Village, Central Karon Beach Resort and Central Kata Resort will be renamed Centara Villas, Centara Karon Resort and Centara Kata Resort, respectively.

Centara, Central Group’s new hotel brand, comes from the words “Central”, the 60-year-old brand name in Thailand, and “tara”, Thai for water or river.

Suthikiat Chirathivat, chairman of the executive board of Central Plaza Hotel Plc, said he believes the name “Centara”, which marks a separation of the group’s hotel and resort business from its retail and food business unit, was more relevant to Thailand than “Central”.

Three different sub-brands have been created to re-brand the 11 hotels under Centara: five-star properties will include the word “Grand” in their titles, village properties will be renamed Centara Villas and spas will be renamed Spa Cenvaree.

The move comes as the Central Group prepares to expand both locally and internationally, starting with a new 505-room hotel, the Centara World Hotel, slated to open March 2008 in Bangkok.

The Marriott hotel chain will take over the 399-room Grand Tropicana Hotel Phuket, in Patong, and rename it the Courtyard by Marriott Phuket at Patong Beach. The company will also pick up the 256-room Surin Beach Resort, which will be re-branded as the Courtyard by Marriott Phuket at Surin Beach.

The Marriott management comes through a deal struck between Marriott, which also owns the JW Marriott on Phuket’s northern end, and Destination Properties.

Both hotels will undergo significant renovations during the process. They are both expected to be finished by early 2008.

Life after the death of the company pension plan

With apologies to Hieronymus Bosch.

Saving money from comes naturally to some people but not to others. Perhaps for most people it is like dieting, postponed until next month, next year or even later.

Traditionally, employees of companies were automatically part of a firm’s pension scheme. The employee would contribute about 7.5% of his salary to the pension fund and the company, in most cases, would match this sum.

After decades of service the employee would be able to retire with a pension of around two-thirds his final salary.

This cozy situation has changed for several reasons. Employers have realized that this does not suit their operations for many reasons.

Often a company’s largest asset will be its pension fund, but this is not an asset of any real financial value to the company and produces little benefit.

Companies have also found that their financial commitments to the pension fund are, in reality, a blank check for a great sum of money and with pensioners living longer than in the past the pension fund can become a huge liability.

It is not simply a matter of companies being greedy, it’s more a matter of survival of the company itself.

Pensions give even the wealthiest governments major problems. After World War II, the British government introduced an old-age pension that, for males, paid benefits from the age of 65. At that time, life expectancy for males was 63 years, now life expectancy is over 70.

Many developed countries are also finding that birth rates are dropping and consequentially the governments’ ability to pay pensions is being challenged. Society has changed dramatically over the past 50 years, as have attitudes toward family responsibilities. In the past, the family was a close-knit unit and one of the benefits was care of the elderly.

The change, especially in wealthier countries, towards smaller nuclear families has seen a change in attitudes towards the financial care of the elderly. People are now expected to take care of their own finances and with governments increasingly unable to take the burden this is what the future holds.

Governments these days are often telling their citizens that they must make provisions for their own retirements. Most governments still pay pensions, but the amounts paid are more aimed at staving off starvation than providing a comfortable retirement.

Expatriates now are in a different position; often employers do not even offer pension plans. Many expats are working in various parts of the world on contracts and change employers every few years. Others are running their own businesses, but in many cases the eventual sale proceeds of the business may well result in inadequate funds for retirement years.

In reality, many businesses fail and if the business operator was relying on the business being the future “nest egg”, he is sorely disappointed. Expats are a diverse group, and are more likely to be more diverse than almost any other group of people. In Phuket, we can see the difference ranging from the extremely wealthy to those who are close to despair.

There are various choices to cover pensions. Offshore insurance companies offer pension plans, and while the lump-sum investment plans, such as mutual funds, stocks and bonds, in this sector are extremely competitive, the pension and savings plans are just the opposite.

Pension plans suffer from high fees and if they have to be cashed in early they are subject to crippling early withdrawal charges. The situation is so bad that since 1990 I have refused to sell pension products because I believe the average person would be better off leaving the money in the bank and investing it only when a reasonable lump sum has been saved.

However, there are usually exceptions to a rule. The pension plan offered by Close Private Bank is such an exception. The charges are moderate, the plan is flexible and it offers a fair deal to customers.

Close Private Bank was formed in the UK in 1873 and has a top investment grade credit rating. The bank is listed on the London Stock Exchange and its shares are part of the Financial Times Stock Exchange – FTSE 250 Index.

The pension scheme is designed for expats through the bank’s Guernsey, Channel Islands, operation; though it also has an office in Singapore.

The pension has several options and benefits. First, it is portable – a contributor can take the pension to whichever country he moves to.

Also, the pension is held in a trust, so that in the event of the death of the holder, there are no delays in obtaining probate. Having a pension in trust means that in the event of insolvency or divorce, creditors may not seize the assets.

The pension plan can be denominated in UK pounds, euros or US dollars. Contributions can be increased, decreased or, if necessary, stopped without any penalty. At the outset of the plan a retirement age is selected, but can be changed at any time.

The assets of the pension can be borrowed, up to 40%, in a pre-agreed credit facility and the bank supplies a gold Visa card to investors. Pension plan members receive a valuation twice yearly and the value of the pension can be checked at any time online.

Close Private Bank is the largest independent merchant bank in the UK and by using its Guernsey Pension Plan, investors have tax-free returns.

Investment choices, which can be changed, range from “Cautious to Neutral” to “Balanced” to “Growth” and there is another option which simply tracks the Libor – London Interbank Offer Rate in sterling, euros or US dollars.

This is by far the best pension plan I have seen offered to expatriates.

Richard G Watson runs Global Portfolios Co Ltd, a Phuket-based personal financial-planning service. He can be reached at Tel: 076-381997, Fax: 076-383185, Mobile: 081-0814611. Email: imm@loxinfo.co.th

Henry Gray, from Scotland, has been appointed Area General Manager of Evason Phuket & Six Senses Spa, which includes oversight of the Evason Hideaway on Koh Yao Noi, opening in September. Mr Gray graduated from the Henley College for Hotel Training in Coventry, England, where he studied Hotel and Catering Management. His experience includes working in India, Indonesia, Mexico, Canada and the British Virgin Islands, including 12 years with Amanresorts.

Phuket native Janejira “Gift” Saywipas, 22, has been promoted to the position of Classifieds Administrator at the Phuket Gazette. She is a graduate of the Communication Arts program at the Phranakhon Rajabhat University in Bangkok.

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Songphol Pongrapeeporn, from Bangkok, has been appointed General Manager of Marketing at Central Festival Phuket. He has a BA and MBA from Golden Gate University in San Francisco, California. K. Songphol’s experience in retail marketing and cosmetics includes working with Shiseido, L’Oreal and Estee Lauder. Most recently he was the marketing and communications manager for Gaysorn Shopping Center in Bangkok.