THAI going back to the future - National carrier to move all but three of its domestic routes from Suvarnabhumi to old airport to save on operating costs.

Thai Airways International is moving all of its domestic routes, except those involving Phuket, Chiang Mai and Khon Kaen, to Don Muang airport once the Cabinet approves its reopening.

The move aims to save on operating costs, which are higher at the new Suvarnabhumi Airport. The flag carrier recently said the move to Suvarnabhumi had added Bt3.7 billion to its annual operating costs.

THAI president Apinan Sumanaseni said yesterday that only flights on three routes would be operated at Suvarnabhumi as they carry a large number of foreign passengers who are taking connecting flights to overseas destinations.

On Thursday, Airports of Thailand's (AOT) board approved in principle the reopening of the old airport following an outcry from low-cost airlines over the higher operating fees.

Budget airlines have complained about the higher costs of using the new international airport, which took over domestic and international flights when it opened on September 28.

Yesterday, AOT informed the Stock Exchange of Thailand that its board had approved reopening the capital's old airport for domestic flights, a move that would reduce operating costs for budget airlines.

Deputy Transport Minister Sansern Wongcha-um said the reopening of Don Muang would relieve AOT from the future investment of Bt1.4 billion for the construction of a low-cost airline terminal.

However, he is unsure whether the move will be permanent. The issue will be forwarded to the Cabinet for approval, possibly next week.

"This should help AOT delay the new investment for four or five years," Sansern said yesterday, adding that the authorities are also addressing the reported cracks on Suvarnabhumi's taxi ways.

AOT said in the statement that if the Cabinet approved the plan, airlines flying non-transit domestic routes would have the option of moving back to Don Muang.

Low-cost carriers including Nok Air and One Two Go have shown interest in moving their operations to Don Muang airport. However, AirAsia wants to move both domestic and international routes back to the old airport.

Apinan said few passengers would be troubled by THAI's intended move. The airline will provide a shuttle-bus service serving the two airports.

He added that THAI would finalise a domestic flight timetable and a comparison of operating costs between the two airports within two weeks.

"Operating costs at the former airport would be cheaper than Suvarnnabhumi Airport. Moreover, Don Muang will be less of a problem for matters such as landing fees, parking fees and ground services, as well as leading to shorter delays. Meanwhile, passengers will also save on travel time and transportation expenditure," said Apinan.

The airline chief also said THAI was proceeding with a plan to set up a new airline, details of which are expected to be completed in six months. The new carrier will operate only domestic routes, using Don Muang airport.

However, investment costs and a formal name have not yet been decided.

"THAI will take a 100-per-cent share in the new airline," Apinan added.

The carrier is will be a full-service airline positioned between low-cost operators and THAI.

THAI will transfer aircraft and facilities to the new airline.

Changes to law 'less drastic than feared, will mainly impact telecom, property firms'

Only 15 listed companies at most would have to restructure their shareholdings to meet the new foreign business ownership rules approved yesterday, according to Stock Exchange of Thailand president Patareeya Benjapolchai. "Most of them are in the telecom and property sectors," she said. "We thought the impact would have been greater due to the lack of information and understanding of the draft amendments. But when the details were revealed, we found out that the impact for the entire market, which has nearly 500 listed companies, is quite limited." She did not identify the 15 companies.

Patareeya's comments came as the stock market took another nose-dive.

It tumbled 2.69 per cent as spooked investors reacted to the Cabinet's agreement in principle to the revised Foreign Business Act.

The SET Composite Index slumped to the day's trough at 615.66 in a knee-jerk response to the Cabinet's resolution reported in the afternoon, before rebounding slightly to close the day at 616.75. Turnover was moderate at Bt21.81 billion.

Foreign investors dumped Thai shares with net sales of Bt274.79 million.

Bangkok Bank was off 3.54 per cent at Bt95.50, PTT dropped 3.03 per cent to Bt192, and Siam Commercial Bank fell 6.60 per cent to Bt49.50.

"Investors sold off their shares on fears that many listed companies would have to restructure their shareholdings, following the amendments.

"However, now that the impact is limited, they should not be panicky," said Patareeya.

The stock market has suffered a series of hard blows and has given up 15.58 per cent of its value since the Bank of Thailand on December 19 adopted harsh measures to counter baht speculation.

The New Year's Eve bombings also gave a sharp jolt to the market.

Wiriya Lappromrattana, assistant vice president at Kiatnakin Securities, said the approval of the amended Foreign Business Act was to blame for the plunge in local share prices.

"This fact could be seen from the stock market's steep fall after the law was endorsed, though the government will give foreign investors a certain period to comply with it," she said.

As amended, the law limits foreign investors to holding no more than 50 per cent of the shares or voting rights of local companies.

The revised legislation will give foreign investors up to one year to rectify their shareholdings, and two years to adjust their voting rights.

Wiriya said she still recommended investors to hold cash rather than stocks, even though some stocks are attractive.

"Investors can start considering piling up on some stocks with good fundamentals when the SET ranges around 600-610," Wiriya said.

Thanomsak Saharatchai, a director of Capital Nomura Securities, estimates that 0.5-1 percentage point would be shaved off of gross domestic product from a combination of the recent bomb blasts in the capital and fallout from tightening up the Foreign Business Act.

These factors will also threaten the earnings of listed companies, he said.

However, he sought to soothe market jitters by saying that the road to the next general election had become a step clearer now that the head of the Constitution Drafting Assembly was appointed.

Under the government's time frame, the assembly must complete drafting a new, permanent constitution within a period of 180 days.