Government affirms help for foreign investment

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Government affirms help for foreign investment

The present government is well aware of the need to encourage and support foreign investment, and it has identified seven special areas where it hopes to attract greater interest from overseas companies and organisations.

Those seven areas, or clusters as the government terms them, are in the automotive and related parts sector, electronics and related parts, food processing, information technology, petrochemicals, rubber and textiles.

The government is keen to encourage small and medium enterprises (SMEs) within these seven clusters and is looking at offering additional incentives and privileges to those companies which are prepared to invest and establish themselves in the brace of special economic zones (SEZs) which are being developed ahead of the start of the Asean Economic Community (AEC) at the end of this year.

The Industry Ministry, together with the Board of Investment (BoI) have been tasked with studying what additional privileges can be offered to SMEs to set up business in the SEZs. The National Economic and Social Development Board has also been seconded to the discussions with the BoI and Industry Ministry officials to give advice and offer its opinions on these key matters.

The government is confident the policies and ideas which will come out of the meetings between the various major stakeholders will help to stimulate foreign investment in Thailand.

At present, the primary focus is ensuring the continued foreign investment strength within the automotive industry. The government recognizes that Thailand is presently the prime production area within Asean for Japanese automakers. Japanese companies are the number one foreign investor in the country, with most of the concentration coming within the automotive industry.

The government has already received encouragement in its aims from the CEO and president of the Mitsubishi Motors operation in Thailand. Morikazu Chokki is quoted as saying that Thailand remains the hub of Japanese investment within Asean and possessed strong economic fundamentals. He said the government’s clear policy of supporting foreign investment would encourage more investors to consider making Thailand their production base.

This is especially true of those businesses, like the automotive industry, which are looking to establish production bases for the long haul. Special incentives and government support are key factors in determining where a major automotive manufacturer will put down its roots.

The government is also keen to continue promoting Thailand as a green automotive production base with solid domestic supply chains by keeping its focus on promoting electric vehicles. There is a plan to employ electric vehicles in public transport and thereby help to promote Thailand as the hub in Asean for green autos.   

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