BoI applications indicate a rise in business confidence
The Board of Investment (BoI) has noted that investment applications being sent to it reached a six-month high in June. In precise terms, the BoI said there were 132 projects which had applied for investment privileges during June. This exceeded the May figure of 119 applications.
Of course, this year had seen a sharp fall, year-on-year, in BoI applications, so the rebound is welcome news for overall business investment within Thailand. The figures show that the political unrest which had begun in earnest following the now ousted governments’ attempt at pushing through an unpopular amnesty bill late in 2013, manifested a very strong drop in BoI applications into the first four months or so of this year. Indeed, the first half of the year shows just over a third drop compared to the same period last year.
It now appears that the wider international business community interested in investing in Thailand has taken the view that the military coup has restored the rule of law and a general stability to the overall economy. So, despite political concerns outside the country at the apparent setback to the democratic process within Thailand, international business seems to have taken a more long-term view and believes the country will ultimately be a better place in which to do business.
The secretary-general of the BoI is quoted as saying that the original target of 700 billion baht of external investment during 2014 may still be possible.
The sectors which were attracting the most BoI interest were machinery, metals, and transport equipment. These three had attracted a combined 165 billion baht of investment. Behind them, with 92.9 billion baht of investment, were the services and infrastructure sectors.
Perhaps not surprisingly, Japanese businesses were leading the BoI charge. Japan has long been one of Thailand’s most important trading partners, and Japanese investors have submitted 194 projects, valued at 80.5 billion baht, so far this year.
Encouragingly, United States investors have also turned to Thailand with 36.7 billion baht being pledged across 15 projects. This represents a quite incredible quadrupling of interest from the US.
Historically, the best year for the BoI came in 2012 when a whopping 1.127 trillion baht was spread across 2,180 projects.
The BoI has set up seminars to be held in August in Sydney, Melbourne, and Adelaide in Australia in the hope of attracting more Australian investment into Thailand.
The BoI currently has 14 overseas offices tasked with attracting investment into Thailand. The offices stretch from Beijing and Seoul to Los Angeles and New York, Paris, Frankfurt, Mumbai, and Sydney.