Sumitomo sees Thailand as its hub in Southeast Asia
Japanese conglomerate Sumitomo sees Thailand as its best bet for a machinery distribution and financial hub serving all of Southeast Asia, which as a region has great potential for growth in the fields of logistics, construction and machinery,and Thailand in the best location and level of development to serve the company’s regional plans and needs.
“Thailand has great potential to be a free zone distribution hub for logistics – both new and used construction machinery,” said Kazuhiko Sasaki, the company’s president for Southeast Asia. “Banking and financial institutions have already started their penetration into the Myanmar market by using their forces in Thailand.”
Sumitomo Group describes itself as a trading company, but is involved in metals, mining, electronics, automobiles, lumber, chemicals, insurance and financial services, rubber, real estate, precision and construction machinery. Founded in Osaka in 1919, it does business today in 66 countries. Sumitomo’s wholly owned Thai subsidiary has been operating in the Kingdom since 1960.
With the advent of the 10-nation Association of Southeast Asian Nations Economic Community (AEC), a free trade and investment zone of 600 million people, Thailand is positioning itself as the prime choice for companies searching for a regional hub or headquarters. Its central location, extensive infrastructure and relatively developed financial sector are among its competitive advantages in the region.
Sasaki said Sumitomo Construction Machinery sees great potential for the AEC and in particular the CLMV (Cambodia, Laos, Myanmar and Viet Nam) markets. The CLMV area’s strength are its population of 200 million and its geographic position as a link between the two giant economies of China and India.
Most economies in the AEC and CLMV regions have been growing rapidly, especially the emerging economies, and all have a strong need to build infrastructure, including Thailand, which is embarking on an infrastructure upgrade requiring nearly $100 billion in investment.
That provides opportunities for Sumitomo’s construction and heavy machinery businesses. The company appointed Thailand’s Leadway Heavy Machinery as its exclusive distributor in the Kingdom for Sumitomo construction machinery, including excavators and pavers, about four years ago.
“The business potential for construction machinery in responding to the high growth in the India-China linkage and China’s economic recovery in the short term is the key driving factor,” said Sasaki.
“Thailand and Myanmar should be the highest priority as our focused market in terms of market size and demand together with the good contribution of our local distributor, Leadway Heavy Machinery,” he added.
Photo courtesy: sumitomothailand.co.th