BoI applications stagnate
The Board of Investment (BoI) recently released figures for the first nine months of 2013 which show that investment applications were only 0.7 percent higher year-on-year from the same period as last year. As well, the number of proposed projects dropped by 6.3 percent from a high of 1,528.
Even so, the BoI secretary-general Udom Wongviwatchai stated the amount of proposed investment of 732 billion baht is ‘among the highest realized in the past few years for the nine-month period.’
There has been increasing interest from Chinese and Malaysian investors while economic woes in Europe as well as the United States and Japan have allegedly been the cause of an interest slump from these normally forthright investment regions.
Chinese applications grew a massive 267 percent year-on-year to 37.7 billion baht. Given the continuing strength and growth within the Chinese economy, despite constant talk of economic slowdown in the world’s most populous nation, it is likely that BoI applications from this country will continue to grow at sharp percentage levels.
While Malaysian investment applications only amounted to 13.8 billion baht in the January to September period, this represents a rise of 33 percent on 2012 figures and encompasses 26 projects.
The two sectors accruing the most overseas project interest are in the service and infrastructure areas. Transportation, which includes the auto sector, and agriculture are the next most favoured.
Mr Udom said there are a lot of projects valued at over one billion baht which the BoI has approved this year, especially in the last quarter. Probably the largest project in monetary terms is the 33-billion baht investment in manufacturing and auto part by the Honda company, while Toyota has had a 17-billion baht project approved for diesel engines and auto parts.
Mr Udom believes the current 2013 target of one trillion baht in BoI investment applications can still be reached, especially with China becoming more involved and interested in Thailand as a place to do business.
Despite a decline of 23 percent in both investment amounts and project applications, Japan remains the single largest BoI foreign country investor. At present Japan has had 448 projects worth 211.35 billion baht approved for BoI in the first nine months of this year.
The United States has seen a 22 percent rise in project numbers, up from 36 in 2012, but the actual investment amount has dropped by a substantial 49 percent year-on-year from the 16 billion baht allocated in 2012.
The Netherlands is presently BoI’s largest investor out of Europe, although this year the Dutch have had just 26 projects worth 21.1 billion baht approved, a decline of 31 and 48 percent respectively.