Globalised architecture?
Costs and benefits of Thailand's openness (28-05-07)
By Jon Fernquest[Introduction|Vocabulary|Article]
[Reading Questions|Answers]
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Exporting and importing goods from a country is easy to visualize. Imagine a bunch of containers in a large ship.
Service exports are harder to visualize.
Take money paid to foreign firms for architectural consulting services, for instance.
A high profile condominium project on the Chaophraya river in Bangkok named The River is scheduled for completion in 2008. (photo on right is already completed Northshore condominium in Pattaya by same firm)
The consulting services of the Singapore-based architectural firm of Thai-European architect Hans Brouwer are being employed in the project.
In the wake of the 2006 coup, many have used the opportunity to propose changes they'd like to see in Thailand's Foreign Business Act (FBA).
Following this trend, The River condominium project has recently been singled out for criticism by architects in Thailand.
As you read the article think hard about the questions the article raises. What do Thai firms receive when they purchase such services? Are these services available in Thailand? How is importing these high-end consulting services different from outsourcing services which replaces existing employees with a lower cost outside source?
Is prestige at stake here? Is the name of a famous international firm being purchased to help sell real estate in Thailand's premium real estate market?
Are there synergies between local and international firms here? To what extent are the Thai partners of the international firm benefiting financially and through technological transfer from the project?
What is there to keep Thai firms from dreaming up and initiating such a project? Does it make sense to charge someone with a crime if the very idea of the project came from them in the first place?
Should ambiguities in laws regarding foreign business in Thailand that were tolerated in the past, suddenly be reversed now? Could sudden reversals have a negative impact on the investment climate and investment in Thailand?
There is also the issue of reciprocity in foreign trade. Thailand relies on exports to drive economic growth. Could reversals in existing trade openness on the Thai side eventually lead to reversals in openness to Thai goods and services exports in the future?
Also think of the unanswered questions. How much money do you think is changing hands in this deal? Is it a large fraction of the value of the condo? Is it a large fee or an equity stake? Would an equity stake help spread project risk?
The prominent architect mentioned in today's article is actually half Thai. Like Tiger Woods, perhaps even evidence and proof of how Thailand's openness contributes to global culture.
What about immigration? What if foreign architects become long-term residents of Thailand and make long-term committments and contributions to Thai economy and culture just as Thais do. A major debate is raging over this issue in the United States now. Whether to tighten immigration rules or not. Probably no one benefits from a global tightening of immigration rules.
These are all possible discussion questions raised by today's article on foreign architectural consulting services in Thailand.
When reading the article, empathy is a good reading strategy to cultivate. Even if you overwhelmingly agree or disagree with one side of the argument, put yourself in the shoes of both sides of the argument for a moment and ask yourself how each side would defend itself, if called upon to do so.
For further reading, read the February 2007 Bangkok Post article that provoked legal action by Thai architects.
Reading Questions
Here are some questions to guide your reading (See answers at end):1. What are some of the costs and benefits of foreign architects participating in Thailand's market for architectural services? (Some are listed in the article, brainstorm for more)
2. What are some of the costs and benefits of foreign interior designers participating in Thailand's market for interior design services? Are the benefits of foreign participation less than they are for architecture? (Express your opinion)
3. What differences are there in the way that foreign and Thai design firms do business in Thailand, according to the expert being interviewed?
4. Does the expert provide any evidence to support his claims? What evidence would consitute good evidence to support his claims? (Express your opinion)
5. What does it mean for an architect or designer to take "continuing responsibility" for a project? Are foreign design firms in a position to take "continuing responsibility" for an architectural project? Why or why not?
6. How do foreign firms sometimes get around legal restrictions by changing job titles?
7. How is the prominent foreign architect involved in the design of The River condominium related to Thailand?
8. What controversy did Hans Brouwer's involvement in Thai architectural projects spark?
9. Why was Hans Brouwer's involvement in Thai architecture only raised as an issue after the coup? Is the issue important? Should his involvement be contested even further or not? (Express your opinion)
Bangkok Post Article May 28, 2007
Architects struggle with global economy
Foreign designers a rising challenge KANANA KATHARANGSIPORNArchitecture legally undertaken by international design firms can help increase the standard of design, building and construction in Thailand. However, it can cause cash outflows and, most importantly, a loss of opportunities for local professionals, says Sinn Phonghanyudh, president of the Association of Siamese Architects (ASA).
"We have to accept the fact that we're in the world of free trade. We don't restrict international design firms, which can legally design projects in Thailand by collaborating with Thai architects, but architecture is about continuing responsibility to a project," he said.
The ASA president estimates 20 to 30 international design firms are legally undertaking work in Thailand. All are owned by foreigners and have a Thai architect holding a local professional licence to sign off on jobs for legal reasons.
This figure excludes an increasing number of interior design firms setting up offices in Thailand to take jobs that the current law does not explicitly cover, he says.
There are more than 100 Thai architectural firms and freelancers. Eighty are registered with the ASA and most take commissions from government agencies at very low fees.
Though there are only 20 or 30 international design firms, the number of jobs they get is several times higher than those obtained by Thai firms, says Mr Sinn.
"What we are concerned much more about is small overseas design firms flowing to popular destinations such as Phuket, Samui and Pattaya during the past several years to design projects that target foreign buyers," he said.
"Many of them [small overseas design firms] have less quality in design and may stay here temporarily. The problem is, who will be responsible for the project if there is any architectural problem? If a Thai architect is the nominee, he has to take all responsibilities, which may even include criminal and civil cases."
Architecture is a protected profession limited to Thais in List 3 of the Foreign Business Act. According to the act, there are generally five activities that are reserved for Thai architects: design service, project management, inspection, development planning and consultancy.
For the first three activities, it is easy to determine whether they are legal as an architect's signature is required to signify responsibility for a project. But this can also give rise to the use of local nominees, something that has been widely discussed in the debate over the amended FBA.
To exploit the grey area in the law, the terms "designer" or "project consultant" instead of "architect" are sometimes used by some developers and architects.
A foreign architect, according to Mr Sinn, cannot undertake a local commission or have his name on a Thai architecture job without collaboration with a local professional who holds an architect's licence.
Two exceptions are designing a residential unit that the architect owns, or one with usable area of less than 150 square metres.
The debate over the role of foreign professionals has been highlighted by local reaction to the design work done by Singapore-based Hans Brouwer, a Dutch-Thai architect, on The River, a luxury condominium being developed by SET-listed Raimon Land Plc.
Comments made by Mr Brouwer in a Bangkok Post story in February prompted the Council of Architects to raise the matter with the police as a possible breach of the law, as Mr Brouwer was not licensed as an architect in Thailand. The case remains under investigation.
Mr Brouwer's company, Singapore-based HB Design, has clarified that its role in Thailand was limited to consultancy, and that it had never served as a "project architect" or "legal architect" for any of its work in the country.
"The role of project architect on all of the projects we are involved with has been carried out by local architectural practices which, as far as I am aware, are fully authorised to practise as professional architects under the Council of Architects," Mr Brouwer said in a statement.
"HB Design is working in the same capacity as design consultant as many other overseas practices - working together with local professional architectural practices to design buildings in Thailand. I believe that this form of close collaboration, between overseas consultants and local architects, is beneficial to all parties and leads to mutual learning on both sides."
According to Raimon Land, HB Design helped in the design of The River, with the project architect and architect of record being Thailand-based Woods Bagot.
Vocabulary (in discussion above)
architecture - the design of buildings (See Wikipedia)
interior design - (See Wikipedia on interior decoration and interior design)
Association of Siamese Architects (ASA) - professional association of arthictects in Thailand (See website)
the Council of Architects - organisation regulating the profession of architecture in Thailand:
"Professional Architects in Thailand are regulated by the law Architect Act B.E. 2543 under the Council of Architects, Thailand. Controlled architectural profession comprises architecture, urban design, landscape architecture and interior architecture."
collaborating with - when two or more people work on a project and share ideas (See Wikipedia on collaboration)
* in collaboration with
undertake - promise to do
an undertaking - a project, something you are doing
undertake work - promise to do, accept a project (accept responsibility for the project, promise to complete the project)
a professional licence - permission from the government to practice some skilled profession such as law, medicine, or architecture (licenses are necessary to protect the public from the damage that unlicensed and unqualified people could do)
* not licensed as an architect
project management - (See Wikipedia)
a consultancy - a consulting form, a company that offers expert advise in a specialised area ()
architect of record - the official architect as recorded on documents
sign off on - provides necessary signature, provides necssary approval
legally undertaken - accepting a project that doesn't break the law (because you are a foreigner)
the current law does not explicitly cover -
a grey area - areas that a law is not clear about
to exploit the grey area in the law - get around law by using parts of the law that aren't clear
breach of the law - break the law, violate the law
freelancers - individuals who provide service under contract, does not work permanently for the company, is paid per piece of work or project (See Wikipedia)
a commission - a project, a piece of work (contracted and paid for)
take commissions from - accept projects from
undertake a local commission - promise to do a local project
a nominee - someone who acts for (on behalf of) another person
* is the nominee
* local nominees
the 1999 Foreign Business Act (FBA) - Thailand's current law that regulates how foreign businesses can conduct business in Thailand
List 3 of the Foreign Business Act - businesses from which foreign companies are excluded because "Thai nationals are not yet ready to compete with foreigners," service businesses including banking, insurance, hotels, tours, selling food and beverages, wholesale, small scale retail, and most construction; professional services are also included such as such as accounting and legal services, advertising, architecture, and auctions; Agricultural industries include rice milling, flour production, fisheries, forestry and the production of various kinds of wood, and plant cultivation; lime production is also included (See Foreign Investment in Thailand: Review of the Current Legislative Regime (2002), page 16)
the amended FBA - the Foreign business act with proposed changes
Hans Brouwer - with a Dutch father and a Thai mother he grew up in Bangkok, worked first for the international design firm Sir Norman Foster and Partners for eight years on projects in Japan, Germany, and the UK, founded his own firm in 1995 named HB Design in Singapore, also teaches architecture at the National University of Singapore (NUS), and served as editor of Singapore Architect magazine (Read biography)
HB Design - international design firm based in Singapore founded by Hans Brouwer in 1995, doing projects in China, Hong Kong, Malaysia, and the US (See website)
architectural practices - architecural firms
The River - when it is completed in 2009 will be Thailand's tallest residential skyscraper with one two tower soaring 70 storeys and the other 44 (See design pictures at website, select "Works" and "The River")
Raimon Land - listed on the Stock Exchange of Thailand (SET) in 1994 and subsequently focused on developing middle income residential housing in the suburbs of Bangkok, restructured in 2002, has recently pursued several innovative projects in the premium property sector in Bangkok’s CBD and inner city including The Lofts, The Lakes, The Legend, The River on the Chaophraya River, Northshore Condominium in Pattaya, and Kata Gardens and The Heights in Phuket (See overview and website)
Answer Key:
1. What are some of the costs and benefits of foreign architects participating in Thailand's market for architectural services? (Some are listed in the article, brainstorm for more)
Participation of foreign architects can:
a. (+) Increase the standard of design, building and construction in Thailand (technological transfer via collaboration with Thai architects)
b. (-) Cause cash outflows from Thailand
c. (-) Cause a loss of opportunities for local professionals
Since no actual values are given, it is hard to judge the relative importance of these factors.
The first factor could be quite important if a lack of standards led to collapse of a whole building, for instance, as actually happened several years ago in both Thailand and South Korea. Inferior building materials and structural design can also lead to a much shorter building life and lower returns on real estate investments. There is also the issue of building codes and standards which are probably stricter in most western countries.
2. What are some of the costs and benefits of foreign interior designers participating in Thailand's market for interior design services? Are the benefits of foreign participation less than they are for architecture? (Express your opinion)
3. What differences are there in the way that foreign and Thai design firms do business in Thailand, according to the expert being interviewed?
a. Thai firms take commissions from government agencies at very low fees.
[Do Thai firms take these projects purely as a public service or is this a way to get their foot in the door on other projects? Again numbers and examples are usually more convincing than unsupported generalisation.]
b. The number of jobs that international firms get is several times higher than those obtained by Thai firms.
[Does this include every building built in Thailand or a subset of high-value or high-profile desirable projects? Are all the registered Thai firms equipped to build according to international standards?]
c. Smaller foreign design firms have lower design standards and stay in Thailand only temporarily.
[Again what concrete evidence is there of this. Small can mean one gifted architect. Why is small more dangerous than big? Small might, in fact, be a better way for facilitate technology transfer. Many activists complain about large and powerful multinational corporations, small means less powerful and easier to control.]
4. Does the expert provide any evidence to support his claims? What evidence would consitute good evidence to support his claims? (Express your opinion)
See notes below the points made in question #5 above.
5. What does it mean for an architect or designer to take "continuing responsibility" for a project? Are foreign design firms in a position to take "continuing responsibility" for an architectural project? Why or why not?
"Continued liability" apparently means accept liability and be sued if problems with his or her design develop later: "If a Thai architect is the nominee, he has to take all responsibilities, which may even include criminal and civil cases."
This implies that if a foreign architect makes mistakes then he or she will not have to face the legal consequences or penalties for them because they will have left the country. The Thai collaborator will have to face these consequences. This raises many questions:
a. Have Thai or foreign architects faced criminal or civil cases in the past?
b. Don't the international building standards and technological transfer that foreign architects bring with them lead to less possibility of lawsuits for both the foreign firm and its Thai partner?
6. How do foreign firms sometimes get around legal restrictions by changing job titles?
"To exploit the grey area in the law, the terms 'designer' or 'project consultant' instead of 'architect' are sometimes used by some developers and architects."
7. How is the prominent foreign architect involved in the design of The River condominium related to Thailand?
His mother is Thai. His father is Dutch.
8. What controversy did Hans Brouwer's involvement in Thai architectural projects spark?
Although Hans Brouwer is a prominent architect internationally, he is not licensed to practice architecture in Thailand.
Thailand's Council of Architects raised this matter with the Thai police as a possible breech of law earlier this year.
9. Why was Hans Brouwer's involvement in Thai architecture only raised as an issue after the coup? Is the issue important? Should his involvement be contested even further or not? (Express your opinion)
