The Amata Times
News from the World’s Leading Industrial City Developer – Q1 / 2016

Vikrom’s
VisionCSR
Amata

Customersin Profile:
MeadJohnsonSee Page 2

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JV
Spotlight

Amata’s
Celebrates
40th Year

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ASEAN’s star performer

Vietnam set for sustained growth
Good news is hard to come by in today’s world,but Vietnam has more than its fair share ofachievement, and appears on track for more of
the same. While politically hardly living up to theWest’s ideal pattern for representative democracy,
Vietnam somehow manages to side-step the criticisms heaped upon other recalcitrant democracies.
Vietnam does things its own way, and the rest of
the world, along with its own citizens, has learned
to accept that style. The Communist Party Secretary General, Nguyen Phu Trong, who prevailed
over his reformist rival, Nguyen Tan Dung, at the
recent Party Congress, will adopt a more conservative approach to reform. However, foreign investors and resident business people feel confident
that the new administration will continue theessentials of reform, including even more liberal
investment rules, implementation of the Trans Pacific Partnership agreement and continuation ofstate-owned enterprise divestment.
A spate of merger and acquisition deals in 2015,
valued at US$5.2 billion, has significantly changed
the corporate landscape. These include investment
of US$108 million by ANA Holdings of Japanin Vietnam Airlines, a US$1.1 billion buy-in by
Thailand’s Singha Group in Vietnam’s beer producer the Masan Group, to be followed by further
10%growthVIETNAM: Personal Consumption Trends

6.9
4.8

%shareShare of GDP

Real growth86

deals involving the Airports Corporation, major
dairy producer Vinamilk, mobile phone producer
Mobiphone, and oil refinery Binh Son Refineryand Petrochemical Corporation.
vestment for further export and domestic industries already under construction.
Acquisition of Germany’s METRO GROUP’s
Cash & Carry in Vietnam for US$712 million by In addition to export earnings, growth is being fuTCC Group of Thailand is likely to be followed elled by strong and rising consumer spending andby acquisition of Big C Vietnam by an associate growth of a well-established middle class of Vietcompany of TCC, Berli Jucker. This company is namese professionals and entrepreneurs.
already owner of the former Family Mart business
in Vietnam, now called B’s mart. These acquisi- Vietnam has achieved truly dramatic progress overtions will have a big impact on the sophistication the past decade, but the best years are yet to come.
of Vietnam’s retail industry.
Between now and 2020, the economy is forecast
to grow at 6.4 per cent per year, matched by equal
Overall Vietnam’s foreign investment enjoyed a consumption growth. While other countries arerecord year in 2015, with over 2,000 new projects struggling with falling export performance, Vietwith total capital of US$15.6 billion and with 800 nam has, and will continue to achieve, doubleexpansion projects with US$7.2 billion in addi- digit export growth. Per capita GDP, which doutional investment. With ever-greater liberalization bled over the past decade, will exceed US$3,000
of investment conditions and facilitation of for- within five years. The population, now already 94
eign worker regulations, Vietnam is now becom- million, will exceed 97 million by 2020, with 60
ing one of the region’s most attractive investment per cent of that population currently under thedestinations.
age of 35. The labor force, with participation byboth genders, is among the highest throughout
GDP growth remains strong and stable, with an the East Asian region.
upsurge in exports arising from recently mobilized
new industries, along with inflows of foreign in- However, yet brighter prospects lie ahead for Viet-

7.0
5.3

5.0

6.5

4
2
0

2.2

1985-90 1990-95 1995-00

2000-05 2005-10 2010-15 2015-20

100

12

90

10

80

8

70

6

60

4

50

2

IMA Asia Vietnam Consumption: strong income growth through 2020

VIETNAM: GDP & Inflation,%%growth%inflation

Inflation

Real growth
8.2
7.0

6.9

25
20
15

6.3

5.8

6.3

4.4

10
5

1985-90 1990-95 1995-00

2000-05 2005-10 2010-15 2015-20

0

IMA Asia Vietnam GDP growth: set fair for 6% through 2020

nam. According to the World Bank, Vietnam canreach upper middle-income status within twenty
years, by 2035, having already achieved over the
past thirty years what the World Bank calls oneof the world’s greatest development success stories.
Such a goal will, however, require great determination, and a continuation of the reform process
already underway.
Along with so bright a future, there are evident
downside risks. Internally, Vietnam will have tomaintain the political, economic, and social discipline for which it has long been renowned. In
addition, great emphasis will need to be placedon infrastructure development, in electricity, water, and transport. Education and health will need
to be given even greater emphasis towards higher
quality standards. Beyond these controllable factors, two major risks prevail. The first is the dispute with China in what Vietnam calls the East
Sea, what the rest of the world calls the South
China Sea. In Vietnam’s hands, the South China
Sea can offer a great wealth of natural resources.
In China’s hands, there are severe risks of conflictwith dramatic downside consequences, both topeace and security and to investment and economic development.
The second risk is the impact of climate change,
which could prejudice Vietnam’s agricultural baseand, most seriously, cause severe erosion and salination of the Mekong Delta, the major rice bowl
and seafood source of the country. Accordingly,
despite the brightest prospects in Vietnam’s history, not all will be plain sailing. But the Vietnamese people have the discipline and determination
to conquer adversity, as they have always done in
the past. It is therefore not surprising that investors region-wide are flocking into Vietnam to gaina share of its forthcoming prosperity.

Amata eyes further expansion in Vietnam
In 1994, Amata City was established in Bien Hoa,
near Ho Chi Minh City. Looking back at twenty
years of doing business in the country, Amata confidently foresees successful future investment in
Vietnam with plans on the table for two new major
developments.

The Long Thanh project enjoys a strategic location
within Long Thanh district, which is part of Dong
Nai Province. Adjacent to the Dong Nai River, andright on the new highway just 10 kilometers fromthe future Long Thanh International Airport, thedevelopment will stretch over 1,285 hectares andwill consist of three elements: a Hi-Tech Park, aAmata’s Long Thanh project will happen in Viet- Mixed-use Development, and a Service Zone.
nam’s Southern Economic Region, the country’s
manufacturing powerhouse nestled around eco- The investment certificate of Phase 1 for the connomic capital Ho Chi Minh City, where 60% of struction of a Hi-Tech Industrial Park has been isthe country’s industrial production takes place. sued under Amata City Long Thanh Joint Stock
And in addition, Amata is exploring for further ex- Company.
pansion in the Northern Economic Region, where
the capital Hanoi is located, close to seaports, air- The US$300 million project, which will coverports, and major routes connecting the capital and 410 hectares, is expected to transform the local
nearby China.
area into a modern, international level industrial

park. It falls superbly in line with the provincial
priority of developing supporting industries. Oncecompleted, the park is expected to produce valueadded products and create employment for 20,000
people, making it an invaluable contribution to thesocio-economic development of the local area, andto Vietnam as a whole.
Dong Nai province has attracted over US$1 billion FDI annually, mainly concentrating onhigh technology and supporting industries. Besides the generous support and attention provided by local authorities, this achievement is
attributable to the completion of a supporting
infrastructure in and outside of industrial zones,
such as highways and, most importantly in thenear future, construction of the Long ThanhInternational Airport, which will create thecountry’s largest international airport with aprojected ultimate capacity of 100 million passengers a year.
If you are interested to learn more about the opportunities and possibilities of Amata in Vietnam,
please contact us at marketing@amata.com.

Surakij Kiatthanakorn, CEO Amata Long Thanh JSC
receives the license from Mr. Cao Tien Sy, Chairmanof DIZA (Dong Nai Industrial Zones Authority)

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Amata Times			

Q1 2016

The world we live in
AEC: A new era begins

On Friday, January 1, 2016, the ten membersof the Association of Southeast Asian Nations(ASEAN) embarked on a project that has its origins almost fifty years ago. The ASEAN Economic
Community (AEC), the region’s first economic
integration bloc, launched as a single market andproduction base.
With a combined population of more than 600
million, and a total gross domestic product (GDP)of USD2.4 trillion, the AEC is an ambitious undertaking for an extremely diverse group of neighboring countries. ASEAN has the world’s thirdlargest workforce and is the seventh largest single
market in the world, making it bigger than theEuropean Union and all of North America. With
China’s economy slowing, and amid projections
that the AEC’s GDP will reach USD4.7 trillion by
2020, ASEAN is expected to be the world’s economic engine for many years to come.
Despite the impressive potential of this economic
community, many analysts and even some government officials in the region have expressed concerns
about a number of challenges facing the fledgling
single market. In fact, it’s quite common for themto describe the AEC as “an ongoing project” or a“work-in-progress”.

uities will be reduced.
In Thailand, as in many countries, there is a general lack of awareness or understanding of what
the AEC means, especially for small and medium
enterprise (SME) business owners, who wonder
what opportunities exist for SMEs. For those whoknow about the AEC, there is some sense that it
will benefit the major economic players, but not
small businesses or laborers. And many Thais, especially in the service sector, fear losing their jobs
to an influx of foreigners.
Other challenges include the lingering security issues, especially territorial disputes with China in
the South China Sea, which, if left unresolved,
threaten to undermine the unity of the group.
Dealing with the threat of terrorism, both homegrown and imported from abroad, also looms large
over the region, and could be a future point of contention.
On the positive side, automotive manufacturingin the region, the bulk of which is based in Thailand, is an area of significant potential growth.
ASEAN will soon be the fifth largest automotive
manufacturing base in the world. And the rising
middle class in the region means more potential
car buyers. But while Thailand exports fifty percentof the vehicles it produces, exports from the restof ASEAN are minuscule, so building the capacity
to develop automotive exports according to global
standards in these other nations will take time.

The most important accomplishment of the AEC
so far, but at the same time, one of the biggest challenges is the removal of tariffs from intra-regional
trade. To date, more than 70 percent of goods produced in ASEAN countries now have zero tariffs,
a situation that is meant to bring down the costs Since the AEC took effect on January 1st, thereof raw materials and production across the region. haven’t been any dramatic changes to life in Southeast Asia. As The Economist magazine noted earlier
But many non-tariff barriers to intra-regional this year, “…2015 should be seen not as a deadtrade still exist, from lengthy customs processing line, but a milestone—as always in ASEAN, as partfor agricultural products, to language issues for of a process, not a finishing line.”
professionals hoping to practice in a neighboring
country, as licensing exams are still conducted in But as the “work-in-progress” continues past thethe native language. Protective measures remain in 2015 “milestone” into 2016 and beyond, expectaplace in many ASEAN nations as a way to protect tions for the AEC will change, and success will notdomestic industries. And since ASEAN does not be judged by the establishment of new milestones.
have the power to force member nations to imple- An editorial in Nikkei Asian Review summed it up
ment changes or agreed-upon policies, eliminating well: “The time for espousing comforting remarksthese non-tariff trade barriers will be difficult.
about building a ‘community’ has passed. What
ASEAN needs to do now is to deliver results.”
Economic disparities are another major challenge.
The GDP of Singapore, for instance, is thirty times If the 10-member nations of the ASEAN comhigher than that of Laos, and fifty times higher munity can overcome the challenges and “deliverthan Cambodia. In the long-term, the members of results”, they have a tremendous opportunity
the AEC will hope that through cooperation and to move beyond the disagreements of the past,by working together to develop systems, people and forge a new era of cooperation and unity forand economies throughout the region, these ineq- the region.

Vikrom’s Vision
By Vikrom Kromadit
Water

Water is a key factor of industrial
estates management, which is not
only about selling land, but also
about providing customers withbasic utilities like power, water,
and infrastructure, consistently
and efficiently. For 2016, Thailand’s Meteorological Department
predicted dramatically changing weather patterns and severe
drought in Thailand, as a result
from the changes of climate andglobal warming.
Amata has given priority to water
since day one, because water is
indispensable to manufacturers.
Therefore, we established our own
subsidiary, Amata Water, to manage water and wastewater and tosupport customers’ water needs.
Amata strictly follows a policy onreserved water contained in reservoirs in and outside of the industrial estates: Water stores must be
at least 150% greater than consumption demand, and as a result,
we have never faced a water shortage situation at Amata’s industrial
estates over the last nearly 30
years. In 2005, the eastern partof Thailand suffered its severest
drought ever, which affected many
manufacturers located in the Eastern Seaboard, but Amata still had
enough water reserves for four tofive months of consumption.
Besides the well-managed watersupply. Amata is efficiently utilizing purification systems that turnwastewater into recycled water at
maximum capability. Nearly theentire amount of wastewater istreated, using different degrees oftreatment, to produce a definedquality of water that will be fit fordifferent intended purposes. Several grades of recycled water areused for cooling power plants, orfor using in the factories, for watering of green areas, and for otheruses. Almost no water is lost in oursystem without utilization.
For 2016, we estimated our approximately 1,000 factories willconsume 31.7 million cubic meters of raw water; water reservesat reservoirs in and outside of theindustrial estates accumulate to 52
million cubic meters. Therefore,
Amata’s water resources, without
any rainfall considered, would last
until December of this year.
With careful consideration, foresight, and vision, Amata promisesthat we will never let our clients
suffer from water shortage. Meanwhile, if clients concur with us on
appropriate and efficient water
consumption and look after theirwater-consuming equipment carefully, it will strengthen and secure
Amata industrial estates’ long-lasting water supplies even more andkeep water available for current andfuture demands.

CSR at Amata
personal health while instilling among participants the benefits ofteamwork and collaborative effort. These qualities are essential to
the foundation of an engaged, productive citizenry capable of cooperating for a shared objective.
Under this regularly recurring program, students from these 17
area schools compete for awards in four diverse team sports: football; volleyball; takraw; and petanque, or boules. The competition
lasts a grueling two weeks, exposing students to both the pressuresand the rewards of combining efforts to achieve worthwhile goals.
Strengthening the bodies and minds of future leadersEver conscious that the future of the Kingdom lies in the handsof its youth, Amata City Industrial Estate actively seeks to findhealthy and challenging ways for young people to develop theirbodies and minds.
In December, the Estate sponsored a two-week sporting event
called Amata Junior Lead #7. Students from 17 schools surrounding Amata joined the competition, which is aimed at encouraging

The winners take home much more than mere medals and trophies. They come away charged with renewed self-confidence andfocused ambitions, more ready to assume the responsibilities ofadult life.
•••
Amata gives back in Vietnam
Amata (Vietnam) JSC organized a charity fundraiser at the company’s recent 20th-year anniversary celebration. A part of the funds
raised, VND40 million (~US$1,800), was recently donated to

Dong Nai Handicapped Orphan Care Center and was complemented with cakes and milk sponsored by Amata’s customers.
The Care Center provides a home to 50 disabled orphans andsupports another 46 disabled children for medical treatment
and care.

Amata Times
Nyoman Mahardika’s career at Mead Johnson
Nutrition seems to have been willed by fate.
He recalls a particular moment after the birthof his daughter, when a nurse at the hospitalgave her a special brand of infant formulathat she immediately liked. It seemed to be aperfect and necessary product, but when hesearched the shops and markets all around thecity, it was nowhere to be found.

www.amata.com					Customers in Profile
Nyoman Mahardika, Director(South Asia Supply Chain)
Mead Johnson Nutrition

He remembers thinking: “This company needs
to improve its supply chain. If its ideal customers want to buy it, but can’t even find the product on the shelves, the company is losing business. If I had a job with them, I’d show them
what to do!”Over that period, one lesson has stuck in Mr.
Mahardika’s mind about how effective management can work across borders. “The key
idea is: you need to understand the culture.” It
was a sentiment he encountered earlier in life
as well, when learning about situational awareness from a mentor at a previous company.

Soon afterwards, Mr. Mahardika got a callfrom a company looking to hire a supply chain
director. By pure coincidence, the company
was Mead Johnson, maker of the infant formula he’d tried in vain to find for his daughter.
He remembers telling that story to the interviewer and being hired on the spot.

“We are all intelligent enough to do the work,”
Mr. Mahardika says. “That’s why we got thejob. But what the old management books don’t
teach you is emotional intelligence and maturity. Like knowing when to be patient. Whento be aggressive. When to listen. How to write
to people.”That was the auspicious beginning of Nyoman
Mahardika’s relationship with Mead Johnson,
a world leader in providing baby and infant
formula under the Enfamil brand, among
others. With much of the corporate world interested in mergers and diversification, MeadJohnson focuses itself on one mission only: tobe the world’s leading nutrition company forbabies and children. With its products now
available in fifty countries and annual net sales
totaling more than US$4 billion, the company
is an excellent example of the wisdom in doing
one thing and doing it well.

Mr. Mahardika has settled into his leadershiprole well, and devotes much of his free time
to public speaking so that others can benefit
from his professional experience. As a certified
professional in risk management, he regularly
speaks to audiences in Thailand and Bali aboutbusiness issues in the region, particularly thoserelated to management and the nutrition/
pharmaceutical industry.

Previously a part of the biopharma giant Bristol Myers-Squibb, the two companies split in2009, at which time Mead Johnson needed tobuild and develop its own separate corporate
identity both inside and outside the company.
Reinvention of a multinational company isa significant challenge, but Mr. Mahardika’s
background helped prepare him for his role in
the process.

A self-described “global citizen”, Nyoman
Mahardika is indeed a man with connections
across many cultures. Originally from Bali,
raised in Makassar (Sulawesi) and educated in
Jakarta, he has spent the past twenty years with
Mead Johnson, during which time he has beenplaced in seven different countries in Asia,
Europe, and North America.

Mead Johnson also reaches out to the surrounding community by taking the initiativeon corporate social responsibility projects bothwithin Thailand and elsewhere. From providing support in flood recovery efforts to theirfunding for conservation of marine life, MeadJohnson’s vision for a healthy future transcends
economics, and is part of the reason why it recently received Thailand’s Green Level 2 Awardfor environmental responsibility.
“A good leader motivates, and is visible whenneeded by the people – but invisible when theyJV Spotlight: Sodexo Amata Services

3

are achieving the objective,” Mr. Mahardika
says. By encouraging innovation and creativeideas from within the company, Mead Johnson’s structure and philosophy help bring its
mission – the maximization of potential – toits employees, its community, and with its constantly-improving infant formula, to the next
generation of citizens as well.

Mead Johnson is the only global
company that focuses exclusively on
pediatric nutrition and is recognized
as a world leader in that category.
• Employees: 8,000 worldwide• Revenue: $4.071 billion in 2015
• Product line: 70+ nutritional formulaand special care products for infants
and children• Market reach: 50 countries in Asia,
Europe and the Americas• Flagship brand: Enfamil• Corporate office: Glenview, Illinois.
Listed on the NYSE (Ticker: MJN)
• Regional locations: Thailand,
Vietnam, Malaysia, Singapore,
Indonesia, Philippines, Hong Kong,
Taiwan, India• New R&D investment: The company
has recently built four PediatricNutrition Institute Regional
Technology Centers, located in
the US, Mexico, China and Singapore• Listed by Forbes as one of “the world’s
most innovative companies” in 2015
• Mead Johnson believes strongly incorporate social responsibility, andfocuses its efforts in 3 areas: Serving
the marketplace through quality andintegrity, protecting the environment
through sustainable business, andnurturing communities for healthand prosperity.

Tee Time!

Aukkares Choochouy, Managing Directorof Amata Facilities Services, a subsidiary of
Amata Corp. notes, “Amata has been working
with Sodexo for about one year (in Amata Nakorn) and found that this company would be
the most successful in providing this kind ofservice on a very large scale.”Amata believes it is important to always be attuned to its customers needs. A good exampleof this is that Amata’s Facilities Services, thegroup responsible for taking care of the common grounds of Amata Nakorn and Amata
City outside of tenants’ spaces, recognized away for customers to become more efficientin utilizing services within their workspaces.
Where a customer might hire different service
providers for, say, security or facility maintenance or landscaping for their factory, Amata
thought, “What if we could help by providing
a flexible one-stop service that could comprehensively solve a company’s many service challenges, thus saving time, money, and hassles forour customers?”

This idea is a bold undertaking on a large scale,so a search was made to find a good partner,
a company who had similar experience inproviding a wide range of quality services tobig facilities. Amata was successful in finding
this partner in Sodexo, a global facilities andfood management multinational company
originated fifty years ago in France. Sodexo has
had a presence in Thailand for over a decade,servicing large entities, such as the UN facility,
Impact Muang Thong Thani; hospital groups,
including Bangkok Hospital Group, Samitivej, Bumrungrad, and Siriraj; universities andschools; hotels, such as Holiday Inn Express;
and other multinationals, such as Unilever andProcter & Gamble.

Amata and Sodexo entered a Joint Ventureagreement in May to July 2015 called Sodexo
Amata Services Ltd. Working together, this JV
offers the ability to custom-tailored services
at an international standard, such as total integrated facility management, like security,
cleaning, preventative and remedial infrastructure maintenance (think electrical, plumbing, air-conditioning, fire systems, generators,
pumps), energy management, project management (extensions and refurbishing), landscaping, reception, and catering; all with a standby
24-hour call center and response readinesswith the ability to dispatch from the estate andarrive to a facility within 10-15 minutes for
emergency or security concerns.
Arnaud Bialecki, Country President for Sodexo Thailand says this about the outlook ofthis meeting of minds: “Sodexo and Amata
both share a long-term vision of a sustainable business. With our partnership we want
to help Amata customers achieve success andlong-term sustainability into their own business. We are confident in the great potentialof our team to deliver best-value solutions for
Amata’s industrial estates.”

Hiroo Nishimura, Executive Advisor, Relationship Management Department, is inviting Amata’s
customers to participate in friendship golf games.
Designed for executives from companies at our industrial estates, the golf events are taking place regularly; having started February, the upcoming next
games will be on March 18 and April 22, held at
Amata Spring Country Club. As Hiroo Nishimurasays, “I believe the game is not only a lot of fun,but it also provides a chance for participants tomake new contacts with executive counterparts
from other businesses, and to meet and interact
with Amata team.” Players take care of green fees,and Amata provides good food and drinks after thegame. Space for each game is limited to about six
groups, so please register early.
Invitations are sent via email. Please get in touchwith the Relationship Management Department
in case you have not received an email, or for further questions, email to Nishimura@amata.com orphone to 038-939-007, ext. 343 or 344.

4

Amata Times			

Q1 2016

Amata 40th Anniversary Celebration
On behalf of AMATA Group, we wish to express our sincere appreciation for
the kindliness, joy, and happiness shared at the 40th anniversary celebration
party on Friday, January 29, 2016.
As many of you know, we started the Company as a small business in 1975
and continued to grow year by year without stopping. Now, we havebusinesses not only in Thailand, but also in Vietnam. Moreover, we plan
to expand our businesses in other countries in this region as well.

We have accomplished a lot with the support of many during the past
40 years, and we will continue to grow together. Thank you very much toall for helping make Amata a fantastic and sustainable company that willcontinue to grow for many decades to come.

CONTACT US
www.amata.com

Vikrom Kromadit
Group CEO
Amata Group of Companies

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