Business leaders greet plan for special trade zone in deep South

The proposal is aimed at enhancing safety for local business operators and attracting more investors to the South, which has been plagued by insurgent violence for the past decade. The goal is to boost economic activities in the region.

Federation of Thai Industries (FTI) chairman Supant Mongkolsuthree said yesterday that he fully supported the idea. 

“The FTI always backs ideas that will help lower the economic disparity and find ways to ease tension in the troubled South. The prime minister’s suggestion means he wants another industrial zone there,” Supant said.

“Having a trade or industrial zone closer to military areas will boost security and local operators’ confidence. However, the government also has to ensure that there are enough raw materials and labour for businesses operating in the zone,” he added.

The FTI chairman said that infrastructure such as electricity, roads and Internet is adequate in the four border provinces of Yala, Pattani, Narathiwat and Songkhla. However, he said, the biggest issue that deters investors is security concerns, so he expects more business operators to pay attention to the South if such a zone is actually put in place and equipped with proper security and production factors such as land, labour and capital.

Penthip Pornchaded, president of the Association for the Promotion of Thai Small and Medium Entrepreneurs, also agrees with Prime Minister Prayut Chan-o-cha’s proposal. She said she believes this would help boost the confidence of local operators, but may not convince operators from other areas to venture into the region. 

“Local operators will realise that they are not being left out of the government’s development plans,” she said.

Deputy Government Spokesman Maj-General Sansern Kaewkamnerd said the measure aims to boost investor confidence in Pattani, Yala, Narathiwat and four districts in Songkhla, where the majority of the population is Muslim. 

The National Council for Peace and Order (NCPO) last year ordered that a special economic zone be created in Songkhla in order to further stimulate the economy of the region. 

“The prime minister said that despite the privileges offered by the Board of Investment [BoI], operators are still concerned about security. So, he has ordered related government agencies to look into the possibility of setting up an industrial zone near military compounds to boost confidence of business operators,” he said. 

“The prime minister expects the expansion of investment to help lift the quality of life, create jobs and income for residents and increase the region’s economic size. The locals will get the most benefit from the development,” he added.

The BoI currently provides a maximum of eight years’ exemption from corporate income tax and a 50 per cent cut in income tax for five years for operators with a minimum investment budget of Bt500,000 in the southern border region. Operators are also allowed to import used machines worth less than Bt10 million for their business.