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Thailand Investment Policy By

Chokedee Kaewsang Deputy Secretary General

Thailand Board of Investment 27 May 2013

Agenda

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1. Investment Policy : Past- Present 2. Future Policy Direction 3. Lessons learned

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Trade & Industrial liberalization

for the country and regions Export

promotion

First Industrial Promotion

Act

Thailand Investment year

(Economic and Political Crisis)

Import substitution

Industrial Promotion Act, 1954

Financial crisis

Competitiveness Enhancement

- National Executive Council Announcement No.227 - Investment Promotion Act, 1977 (Amended 1991) - Eastern Seaboard Development

Announcement no. 1/36

Relaxation of investment Promotion criteria

- Announcement no. 1/43 - Amendment of Act no. 2001 - Increase CAP - Adjust the rules and regulations to conform the WTO’s - Focus on proactive marketing strategy

Special measures and incentives

- National Executive Council Announcement No.33 – Industrial Promotion Act,1960 - BOI founded in 1966

Sustainable Investment

- New vision - Sustainable

investment policy

Investment policy : Past – Present-Future

Economic Restructuring

Tools/Measures

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● Tax incentives

● Non-tax incentives ● Information Provision ● Service Provision ● Conditions on Performance Requirement ( Environment, Standards, Technology

transfer, etc.)

Investment for sustainable scheme

Environment

Economic Social

Sustainability

New direction approved by the Board on 25 January 2010

: to encourage “Investment for Sustainable Development”

Investment Promotion Policy

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Special incentives for 3 groups of targeted activities

1) Manufacture of eco-friendly material and product

2) Energy saving and alternative energy 3) High technology activities

Investment for Sustainable Development Scheme

Functional fiber Medical food Medical supplies or medical equipment Eco-friendly chemicals/products such as bio-plastic Biotechnology Nano-materials and products from nano-materials Advanced Ceramics Scientific equipment Research and development Traction motors for vehicles (hybrids or fuel cell cars) Battery for EV

Thailand 1.0

Thailand 2.0

Thailand 3.0

Thailand 4.0 • Knowledge-based Economy • Creative Industry • Green Industry • Alternative Energy • Hospitality & Wellness • Logistics Hub

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ODM & OBM

• R&D • Product Champion & Specialty Products

Thailand’s Future Industry Direction

Rationale for revising investment promotion strategies

(Data compiled from 11th National Economic and Social Development Plan and Thailand’s Industrial Development Plan)

Elevate the standard and value-added creation

Agriculture

Light industry

FDI-based (Auto, E&E, Petrochemical)

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Promote investment to restructure Thai economy for sustainable development and to overcome “Middle Income Trap”

Promote competitiveness development and value creation of industrial sector

Promote green industry to drive balanced and sustainable growth Promote new industrial clusters in the regions to create new investment concentration Promote Thai overseas investment in order to increase competitiveness

of Thai businesses

New Investment Promotion Strategy Direction

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Basic infrastructure for industrial development

Industries that are developed from domestic resources and

Thainess

Industries that Thailand is

competent to be global manufacturing base

(Global Supply Chain)

Advanced core technologies that help elevate Thai industry

Future industries to be promoted

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To drive/set economic agenda VS being driven by them Limited expertise in some sectors/issues, need support from

resource persons/consulting firms Limited tools/measures, need coordination with related org. Outcome/impacts essential, but output more visible From output to outcome, need clearer KPIs Monitoring impacts of investments increasingly important Public participation has both pro. and con. Balancing benefits of stakeholders is essential but not easy When Policies conflict, hard to decide which policy is given

higher priority?

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Thank You