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2 July 2015
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Flood-hit firms wary of more diaster


TWENTY-TWO percent of the 84 manufacturers operating in seven industrial estates in the lower Chao Phraya River basin that were affected by the flood disaster of 2011 believe there will be another major inundation within the next 15 years, a survey by the Thailand Development Research Institute (TDRI) has found.

Most if not all of the operators that were affected have taken some kind of measures to prevent or soften the blows they expect from the next flooding disaster.

The accumulated losses in the industrial sector from the 2011 flood have been estimated at around Bt1 trillion. The industrial sector took the biggest financial hit, losing more than the water and sanitation, infrastructure, financial, tourism and agricultural sectors combined.

“The 22-per-cent figure [those expecting a further disastrous flood within 15 years] is considered high,given that major flooding is a once-in-a-100-years event. While most of them have taken some kind of measures against it, they also urge the government to come up with a tangible water-management plan to prevent the possibility of it happening again,” said Somchai Jitsuchon, the TDRI’s research director for Inclusive Development.

“Large firms tend to have done more in the way of adaptation, specifically moving some production that is easier to shift elsewhere in Thailand. The expectation of future flooding is part of the reasoning behind moving their production, but it is not the main reason,” he said. The main reason manufacturers with the capability and the capacity have moved some of their production to other industrial estates within the Kingdom, such as the one in Laem Chabang, is the anticipated improvement in logistics and infrastructure,and it is not solely about moving away from further anticipated flooding, he explained.

“Nevertheless, the number of production lines that have been relocated is small, to the extent that they can be counted on one hand,” he said.

“Manufacturers in the flood-troubled region do not have confidence in the government’s Bt350-billion water-management plan, because it has been delayed and changed so many times,” the research director added. He listed the main measures that have been taken by the manufacturers against future flooding as: creating their own warning system via regular observation of the water level (53.6 percent have done so); preparing water pumps (33.3 percent); permanently moving machinery to a higher location (32.1 percent); upgrading flood insurance (30.5 percent); renting storage outside (29.8 percent); moving their production base (22.6 percent); preparing sand bags (20.2 percent); building flood-prevention walls (14.3 percent); and investing more in other areas (13.1 percent).

Somchai also said manufacturers overwhelmingly (90 percent) agreed that land use was critical to flood management, while 97.6 percent agreed that water and flood management should be integrated into land-use policy, and 94 percent agreed that land-use policy should be designed and enforced on a river-basin basis.

Deunden Nikomborirak, the institute’s research director for Economic Governance, said land use was crucial to water-management plans, as flooding problems were mostly caused by water-paths being blocked by buildings.


First published in The Nation, 2 July 2015


Somchai Jitsuchon, Ph.D.
Research Director, Inclusive Development
Deunden Nikomborirak, Ph.D.
Research Director, Economic Governance