VZCZCXRO3398
RR RUEHCHI RUEHDT RUEHHM RUEHNH
DE RUEHBK #1475/01 0720803
ZNR UUUUU ZZH
R 130803Z MAR 07 ZDK
FM AMEMBASSY BANGKOK
TO RUEHC/SECSTATE WASHDC 5489
INFO RUCNASE/ASEAN MEMBER COLLECTIVE
RUCPDOC/DEPT OF COMMERCE WASHINGTON DC

UNCLAS SECTION 01 OF 02 BANGKOK 001475 
 
SIPDIS 
 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: EAIR EWWT ELTN TH
SUBJECT:  AMBASSADOR MEETS WITH MINISTER OF TRANSPORTATION 
 
BANGKOK 00001475  001.2 OF 002 
 
 
¶1.  SUMMARY:  On March 6, the Ambassador, accompanied by the 
Commercial Counselor and a group of industry representatives met 
with Thailand's Minister of Transportation.  The Minister and his 
staff were receptive to the points made by the Ambassador and the 
industry representatives on Open Skies, airport baggage screening, 
the customs free zone at the airport, port and inland container 
terminal utilization, and communication with stakeholders, promising 
to follow up on the issues or, in some cases, indicating that 
resolutions were already in process.  The Minister designated a 
contact person to facilitate future follow-up with the ministry. 
End Summary. 
 
¶2.  On March 6 the Ambassador led a delegation including the 
Commercial Counselor and industry representatives to meet with 
Admiral Thira Hao-Charoen, the RTG Minister of Transportation.  The 
industry group included representatives from Federal Express, UPS, 
Northwest Airlines (also representing United Airlines), Boeing, GE 
Aviation, Pratt & Whitney and the AMCHAM Transport/Logistics 
Committee.  Ministry staff present included Deputy Minister Sansern 
Wongcha-Um, Permanent Secretary Chaisawasdi Kittipornpaibul, Office 
of Transport and Traffic Policy and Planning Director General 
Maitree Srinarawat, and Mr. Chula Sukmanop, Chief of Multi-modal 
Transport Development Group.  The visit was organized by the Foreign 
Commercial Service in Bangkok as an opportunity to raise industry 
issues with the ministry and establish lines of communication for 
the future.  Although the meeting only lasted 30 minutes, a wide 
range of issues were raised, and the Minister and his staff proved 
generally receptive responsive. 
 
EMBASSY AND INDUSTRY CONCERNS 
 
¶3.  The Ambassador used his opening remarks as an opportunity to 
urge the RTG to quickly resolve outstanding questions regarding the 
interpretation and implementation of the Foreign Business Act in a 
way that will help promote further investment in Thailand. 
 
¶4.  On specific issues, the Ambassador asked the RTG to accept 
blanket designation of U.S. airlines for operations in Thailand 
under the 2005 Open Skies agreement.  He noted that Thai airport 
authorities had not yet completed takeover requirements for baggage 
screening equipment, preventing the stockpiling of spare parts. 
This situation raises the risk that equipment breakdowns could force 
Thailand out of compliance with ICAO Annex 17 requirements. 
 
¶5.  The Ambassador encouraged the Ministry to improve communications 
with stakeholders when considering policies that affect them. 
Specific examples mentioned included operations at the troubled 
Suvarnabhumi Airport and the status of the Customs Free Zone (CFZ), 
also at the new airport.  He pushed for a clear and transparent 
decision making process for any policy changes affecting industry 
stakeholder. 
 
¶6.  The Ambassador remarked on the upcoming decision on an engine 
supplier for the Airbus A380 aircraft ordered by Thai Airways 
International (THAI), and encouraged the MoT and THAI to give 
favorable consideration to the U.S. bidders on the contract. 
 
¶7.  After the Ambassador's remarks, the representatives from 
industry had an opportunity to make additional points.  The 
representative from Northwest Airlines, speaking on behalf of the 
Board of Airline Representatives, complained that the Airports Of 
Thailand (AOT, the operator of Suvarnabhumi Airport) never issued 
official notices to the airlines regarding decisions on operations 
at the airport.  He noted that the airlines were often reduced to 
drawing their information from the newspapers, or at best from 
verbal comments. 
 
¶8.  Representatives from the Engine Alliance (GE Aviation and Pratt 
& Whitney) asked about the timing of the decision on the engine for 
the THAI A380s.  (Note:  A decision on the engine supplier was 
previously expected by the end of 2006, but was postponed as a 
consequence of Airbus production and delivery delays.)  Separately 
Pratt & Whitney inquired about the engine decision on THAI's order 
for A330 aircraft.  GE commented on maintenance capabilities it 
could offer. 
 
¶9.  Boeing, observing that THAI represented critical infrastructure 
for Thailand, and that the aviation industry is very competitive, 
noted that THAI's fleet of aircraft is old.  Boeing urged the MoT 
and THAI to consider all options for renewal of the fleet (i.e. 
Boeing over Airbus aircraft). 
 
¶10.  Federal Express noted that restrictions on when heavy trucks 
are permitted in the Bangkok metropolitan area, intended to reduce 
traffic congestion, in fact result in more traffic, since a larger 
number of smaller trucks are necessary.  FedEx requested that the 
MoT favorably consider its request for an exemption. 
 
¶11.  PB Agencies Co., speaking for the AMCHAM 
Transportation/Logistics Committee noted that Thai - U.S. trade was 
growing rapidly, and that roughly 500,000 containers were shipped 
from Thailand to the U.S. in the past year.  He noted that the Thai 
 
BANGKOK 00001475  002 OF 002 
 
 
logistics infrastructure, especially the port of Laem Chabang, were 
being inadequately utilized, with inefficient transport of freight 
from the port to the inland container terminals (ICTs).  He also 
noted that the ICTs have been operating without leases for months, 
rendering expansion and investment difficult. 
 
MINISTRY RESPONSE ENCOURAGING 
 
¶12.  In responding to the points raised by the Ambassador and the 
industry representatives, the Minister deferred to members of his 
staff to address the specific points.  On the Open Skies issue 
Director General Maitree Srinarawat noted that case-by-case 
designation is required by Department of Civil Aviation (DCA) 
regulations.  While regulations can be changed relatively easily 
(without changes to the law), the process will take some time. 
 
¶13.  Deputy Minister Sansern Wongcha-Um made note of the point about 
getting news of airport operations from the press, saying he could 
well understand the frustration of the airlines.  He promised to 
request that AOT revise their practices to issue written 
notification to stakeholders regarding decisions on airport 
operations.  He did not have information about the baggage screening 
equipment issue, but promised to look into it.  Regarding the 
possible changes to the operations at the CFZ, MoT stated that 
consideration of any changes had been postponed for one year, after 
which proposals for a revision of the regime would be reconsidered. 
 
 
¶14.  On the ICTs, DG Srinarawat stated that an agreement in 
principle had already been reached for a 5-year lease extension with 
the existing operators.  The agreements were due to go to the State 
Railway of Thailand (SRT) the next day (March 7) for approval; 
signing of the leases should follow soon.  Mr. Chula Sukmanop noted 
that plans for a double track rail from the port of Laem Chabang to 
the ICTs were already going forward.  Soil considerations 
necessitate design modifications, but 6,000 THB has already been 
allocated in the budget for the project. 
 
¶15.  Regarding the A380 engine choice, Mr. Sukmanop stated that the 
MoT was still waiting for documentation from THAI.  The same was 
true for the A330.  As for THAI fleet renewal, Deputy Minister 
Wongcha-Um stated that the ministry had already asked THAI to 
conduct a complete review of its investment plan, implying that 
Boeing would be considered for any future aircraft purchases. 
 
¶16.  In closing, the Minister noted that Permanent Secretary 
Chaisawasdi Kittipornpaibul would be the point of contact in the 
ministry for follow-up on the issues raised in the meeting, or on 
future concerns. 
 
COMMENT 
 
¶17.  The MoT response to the issues raised by the Ambassador and 
industry was very encouraging.  The Minister and his staff listened 
carefully and made promises to address the concerns discussed. 
Nevertheless, several commitments were general in nature, especially 
when secondary agencies were involved, such as on AOT 
communications, the DCA and Open Skies, or THAI and the engine 
selection process.  Close follow-up will probably be required to 
ensure that these commitments produce concrete results 
 
BIOGRAPHY 
 
xx.  Admiral Thira Hao-Charoen was born 6 April 1940 and has been a 
career naval officer.  His training includes study in the U.S. and 
UK, most recently at the Naval Command College in 1982.  After 
serving as Commanding Officer of the HTMS Chang from 1975-76, Adm. 
Hao-Charoen has held mostly staff positions.  These include Aide, 
and later Staff Officer to the Commander in Chief, RTN, Naval 
Attache in Washington, Chief of the Naval Secretariat, Deputy 
Commandant of the Naval Academy, Commandant of the Naval War 
College, Assistant Chief of Staff for Logistics, RTN, Deputy Chief 
of Staff, then Chief of Staff, RTN, Deputy Commander in Chief, RTN. 
From 1998-2000 Adm. Hao-Charoen served as Commander in Chief, RTN. 
From 1996-2000 Adm. Hao-Charoen served as an appointed Senator. 
Adm. Hao-Charoen is an Honorary Aide-de-Camp to H.M. the King, and 
is a Judge of the Military Supreme Court.  Adm. Hao-Charoen speaks 
very softly and as a manager appears to prefer to delegate 
responsibility 
 
 
Boyce