By Petchanet Pratruangkrai
"The office has to shift its focus from promoting investment in the Kingdom to the region. The AEC’s seamless trade will encourage more Thai enterprises to go abroad, particularly in Asean, which is the strong growth region amid the gloomy global economic trend," Vasana Mututanont, deputy secretary-general of the BoI, said last week.
Rising operating costs, shortages in many areas such as raw materials and labour and the BoI’s policy to upgrade its target to hi-tech investment in Thailand has convinced the office to encourage overseas investment.
The BoI will employ legal and local consultants in those three targeted markets to assist Thai investors in exploring market opportunities there and better understanding each country’s laws.
Companies see Myanmar, Indonesia and Vietnam as having the highest capability to serve as a base for many industries. Their big pool of workers and wealth of natural resources are big selling points for Thai enterprises, particularly medium-sized firms, to set up businesses there after exporting to those countries.
According to a Bank of Thailand report, Asean is the largest overseas destination for Thai investment. From Thailand’s total outbound investment of Bt92.28 billion in the first quarter of this year, Bt31.12 billion went to Asean. The largest investment bases in Asean for Thailand are Singapore with Bt13.31 billion, Myanmar with Bt9.69 billion and Indonesia with Bt3.88 billion. To make investing abroad easier, the BoI has discussed with other government agencies about sweeping away barriers and preparing assistance measures. For instance, it has talked with the Finance Ministry about eliminating double taxation.
The agency usually meets four times a year with its counterparts in the other nine Asean countries to coordinate closely on investment promotion schemes among member states and build better understanding of each country’s investment laws.
Besides promoting investment to Asean, the BoI has conducted a study on investment and market opportunities in 20 other nations with good potential to serve as new investment bases for Thais in the near future.
They include countries in South Asia, mainly India, Sri Lanka, Pakistan and Bangladesh, and countries in Africa such as to Ethiopia with emerging economies and large populations and workforces.
The fast growing world economy and free-trade markets will lead more Thai companies to establish a foothold overseas. The BoI, which is involved in beyond Thailand’s borders, while keep domestic investment privileges for puling industries up the value-added ladder.
It is regularly organising overseas missions aimed at a specific industry, such as garment and textiles, agricultural and food, automobile and motorcycle parts, construction, and tourism and service. It is conducting a training course to develop more Thai investors as multinational firms. From January-April, the BoI successfully trained 73 Thai firms in doing business offshore.