CHON BURI – Floods in Thailand have breached a major industrial complex, raising fears of a repeat of the devastation suffered in 2011, which led to world shortages of electronics and car-parts. Already two factories have been forced to close. So far water levels are said to be manageable.
For now there is respite at the Amata Nakorn industrial estate, 100 kilometers east of the Thai capital, Bangkok. There are 700 factories here, half from Japan, manufacturing mostly electronics and auto-parts.
Much of the water has receded, but it had blocked roads and forced two companies to close. Factories have drawn up evacuation plans – an ominous warning of disruption if Thailand’s widespread flooding continues to worsen.
In 2011, Thailand’s most serious flooding for half a century affected 10,000 factories and cost the economy 45 billion U.S. dollars.
It caused a world shortage of hard-disc drives, equipment for Apple computers, Sony cameras and components used in Ford, Toyota and Honda cars.
This year, floods have affected half the country and 36 people have died, but until now the water hadn’t reached industrial areas.
“I think it is unpredictable for nature. You don’t know what will happen but anyhow, we are preparing,” said Viboon Kromadit, chief of operations of Amata Nakorn Industrial Estate.
Thailand’s central region, devastated in 2011, is now better prepared to ward off flooding.
These more-easterly provinces escaped the deluge then, but could suffer this time, raising concerns of electronic and component shortages and a rise in world prices.
Keeping the supply-chain open is vital for Thailand, and customers will be closely watching how the country copes with its second major flood in two years.
Companies have raised output in case of problems in coming days. And in the long-term, the Thai government’s looking to spend 75 billion dollars to make roads, rail and waterways more resistant to flooding.
Thailand’s industrial growth was brought to a standstill by flooding in 2011. Much work has been done building barriers and run-offs to prevent a repetition. That work now faces its first major test.