Thai tannery to close

According to daily Bangkok Post, troubled state firm, the Tanning Organisation, is to be shut. The Defence Council resolved in late January to dissolve the organisation, a state enterprise under the Defence Ministry, which has been in financial trouble for many years. The dissolution takes effect from March 31. Chakkrit Intarathat, defence spokesman, said that the Defence Council agreed to a suggestion by the Finance Ministry's committee for the restructuring of state enterprises, that the organisation should cease operation. With a debt of more than 400 million baht with private companies and financial institutions, the Tanning Organisation have about 400 employees who are entitled to compensation. They are also obliged to supply products to those clients with which they have signed contracts. The organisation produce 300,000 pairs of combat boots and 500,000 pairs of shoes for military personnel every year. The public debt administration act of 2005 does not allow the Finance Ministry to guarantee loans for a state enterprise that has been running at a loss for more than three consecutive years.