Investing in Thailand
Thailand is an important investment destination. Foreign Direct Investment has played a huge role in Thailand’s economic growth in the last decade, as it was one of the best performers. More than a beach and retirement destination, Thailand is an export hub with an impressive stock performance. FDI to Thailand tripled in 2015, up to 10.8 billion dollars. 2016 exceeded expectations as it again landed 10.3 billion for that year, cementing Thailand as the main player for exports.
Why Should You Consider Thailand For Investment?
It is a naturally rich country
It’s full of natural resources like oil, sugar, coconut, gas, and other mineral and agricultural products. Making use of these natural assets, the country has focused on exporting. Thailand is the world’s largest exporter of rice and a main producer of shrimp. Exports are so strong, they make for the 60% of the country’s GDP.
The other remaining percentage goes in large part to the service economy. Thailand has developed many infrastructure projects that have stimulated the economy. Banking, finance, and tourism are responsible for almost half of the GDP.
A Capable Work Pool
This surge in services is also boosted by a skilled workforce, especially for these and other sectors. The Thai workforce is well trained and skilled, while still perceiving lower wages than in more developed countries.
A Strategic Location
A strategic location in Asia, as the country serves as an entryway between southeast Asia and the upper Mekong Basin.
A Supporting Government
The political turmoil of recent years hurt business confidence and direct investment, but the new leader wants to prove otherwise. General Prayut Chan-o-cha, the new self-instituted Prime Minister, has worked to lure investors back.
The Prime Minister has instated a government policy promoting investment and free trade. This led to the creation of many government agencies to help investors spend their money in Thailand. Also, the regime is in total accordance with WTO regulations. This means no export conditions, no restrictions in the manufacturing sector, and no local requirements.
The country has signed 41 bilateral investment treaties for the protection of Thailand’s foreign investments.
Where to Invest in Thailand
The Thai Board of Investment (BOI) offers many incentives for investors. These include advantages like six industrial sectors and eight years of tax exemption for companies. Transport, electricity and re-supply deductions; and even 25% reliefs for establishment and construction costs.
The sectors included are:
- Agriculture and food
- Renewable and alternative energies
- Electronics, information and communication technologies (ICT)
- High added value services (including leisure, health, and tourism)
Apart from the sectors mentioned beforehand, the BOI released a new list of Investment Policies. The Deputy Prime Minister approved many more incentives for foreign investors, in response to a slowdown in 2016. These include:
- Double Depreciation during 2016, including new assets in machinery, equipment, tools, computers, software, vehicles and constructions
- Triple R&D expenses permitted until 2019
- Next Generation Automotive
- Smart Electronics
- Aviation & Logistics
- Agriculture & Biotech
- Food Processing
- Biofuels & Biochemicals
- Digital Technologies
- Medical Hub
- Affluent & Wellness Tourism
Many other and specified advantages can be found on the official site of Thailand’s Ministry of Finance.