Download as PDF, PPTX
Uploaded byChanin Khaochan
Business Opportunities in Thailand
The document provides an overview of business opportunities in Thailand. It discusses Thailand's rankings as a top prospective host economy for foreign direct investment from 2012-2014. Specific industries of opportunity highlighted include agriculture and food processing, automotive, machinery, electronics and alternative energy. Details are given on Thailand's strong food and automotive industries, noting Thailand's position as the world's top exporter of cassava and a top global producer of vehicles.
More Related Content
Similar to Business Opportunities in Thailand
Business Opportunities in Thailand
- 1. BUSINESS OPPORTUNITIES IN THAILAND Udom Wongviwatchai Secretary General Thailand Board of Investment March 2013
- 2. TNCS’ TOP PROSPECTIVEHOST ECONOMIES FOR 2012–2014 (PERCENTAGE OF RESPONDENTS SELECTING ECONOMY AS A TOP DESTINATION) (x) = 2011 ranking 1 China (1) 2 United States (2) 3 India (3) 4 Indonesia (6) 5 Brazil (4) 6 Australia (8) 6 United Kingdom (13) 8 Germany (8) 8 Russian Federation (5) 8 Thailand (12) 11 Viet Nam (11) 12 Mexico (10) 13 Japan (-) 14 Netherlands (-) 14 Poland (6) 14 South Africa (-) 17 Korea, Republic of (-) Developed economies 17 Sweden (-) Developing and transition economies 19 France (19) 19 Italy (-) 19 Malaysia (19) Source: UNCTAD Top host economies for FDI 2012-2012 as of July 12, 2012
- 3. 2013 2013 1 Singapore 11 Finland The World Bank Ranks Thailand among the easiest 2 Hong Kong 12 Malaysia places to do Business in New Asia and 18th in the World 3 Zealand 13 Sweden United 4 States 14 Iceland 5 Denmark 15 Ireland 6 Norway 16 Taiwan United 7 Kingdom 17 Canada 8 Korea, Rep 18 Thailand 9 Georgia 19 Mauritius 10 Australia 20 Germany Source: Doing Business 2013, October 25, 2012
- 4. Value of InvestmentPromotion Applications By Industry, 2003 – 2012 Agro Minerals Fashion Auto E&E Chemical Services Euro billion 40 37.01 35 30 15.3 25 20 16.42 17.63 16.84 15.88 15.97 6.1 15 4.4 12.82 11.20 4.1 4.3 11.17 6.2 4.2 2.7 7.98 3.1 3 9.4 10 2.2 3.2 2.2 4.1 4.2 2.1 3.8 6.4 1.4 1.9 2.2 1.5 3.6 1.3 0.6 1 1.5 0.3 5 2 1.7 2.1 1.6 3.3 1.7 0.4 4.3 1.1 4 1.4 1.4 1.7 1.5 1.5 3.3 1.9 0.3 0.4 0.5 0.3 0.2 0.5 0.7 0.8 0.5 0.7 0.8 0.4 0.7 0.5 1.5 1.8 1.7 1.8 2.4 0.9 1.3 1 1.1 1 0 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 Exchange rate: €1 = Bt39.96 in 2012 Source: BOI, as of Jan 17, 2013
- 5. ASEAN - EUSnapshot ASEAN’s Macro-Economy • GDP (2011): US$2,112.4 Bn* (€1,643 bn) • GDP per capita: US * IMF Forecast $3,376 (€2,626 bn) • GDP Growth: 5.7% and 6.4% in 2011-2012 • Population: 600 million EU’s Macro-Economy • GDP (2011): € 12,650 bn • GDP per capita: € 25,200 • GDP Growth: 1.5% and -0.3% in 2011-2012 • Population: 501 million Source: European Economic Forecast 2013 & Eurostat Source: Tilleke and Gibbins & IMF Forecast as of Feb 27, 2013 Exchange rate: US$1=Bt31.08 and €1 = Bt39.96 in 2012
- 6. ASEAN Corporate IncomeTax 2013 30% 25% 20% 15% 10% 5% 0% Singapore Thailand Vietnam Malaysia Indonesia Source: KPMG
- 7. Sectors of Opportunity Agriculture and food processing Biotechnology Automotive Target Industries Target Alternative Industries energy Machinery Mold & Die E&E
- 8. Food Industry “Thailand: Kitchento the World”
- 9. 2011 THAILAND’S TOPFOOD EXPORT CATEGORIES AND WORLD’S RANKING World’s # 6 Rice & Grains World’s # 1 Cassava Exports Exports THAILAND: 12th in total food exports World’s # 2 Sugar Exports World’s Top 15 Fruit World’s $# 3 Fishery &Vegetable Exports Exports
- 10. Strengths of ThaiFood Industry > 80% of raw materials used by the food industry are locally sourced at low prices Abundant Raw Material Skilled & Good hard working Quality & Safety Workforce Size of workforce now > 39.5 million GMP and International Standard Minimum Daily Wage Bt300 (€7.5) Good Manufacturing Practices is a mandatory measure for 54 types of food products Source: Thailand Food Industry Outlook, Commercial Section, Royal Danish Embassy Mar 2011
- 11. Automotive Industry “Thailand: AutomotiveHub of Asia” As of Feb 14, 2013
- 12. Thailand’s Automotive Industry Overview Thailand: Target: Output: High local 9th largest To 14 content : automobile manufacture assemblers 80-90% for producer in 3,000,000 with a pick-up and the world in units in 2017 combined 30-70% for 2012* production passenger of more car than 2,000,000 in 2012 Source: OICA and TAI
- 13. 2012 Thailand’s AutomotiveIndustry VEHICLE MOTORCYCLE Growth Growth Growth Growth December Jan.-Dec. December Jan.-Dec. YOY % YTD % YOY % YTD % Production (Units) 221,353 2,453,717 123 68.32 183,384 2,606,161 21.30 27.56 Domestic Wholesale 144,676 1,436,335 161 80.71 152,894 2,130,067 24.94 6.11 (Units) Export (CBU) 86,297 1,026,671 146 39.56 85,959 856,935 -29 -24.37 (Units) Source: Thailand Automotive Institute as of Jan 28, 2013
- 14. Top 100 GlobalSuppliers 2010 Present in Thailand Japanese Global Suppliers Other Global Suppliers 2. Denso 46.Bridgestone 1. Robert Bosch 44. Federal-Mogul 4. Aisin Seiki 49.Tokai Rika 3. Continental 47. Michelin 13.Yazaki 57.Showa 6. Faurecia 50. GKN Driveline 15.Sumitomo 61.Mitsuba 7. Johnson 52. Goodyear 16.Toyota Boshoku 66.Asahi Glass Control 56. Grupo Antolin 18.CalsonicKansei 72.Stanley 8. ZF 58. Bayer 19.JTEKT 74. Akebono 11. TRW 59. TI Automotive 20.Hitachi Brake 12. Delphi 65. Draexlmaier 28.Toyoda Gosei 82.Sanden 14. Lear 67.American Axle 33.NTN 84. F-Tech 17. BASF 73. Rieter Auto. 34.NSK 92.Alpine 21. Valeo 84. F-Tech 35.Mitsubishi 94.Pioneer 22. Visteon 86. Hayes 39.NHK Spring 98. Omron 23. Autoliv Lammerz 40.Koito 25. Mahle 93. 3M 41.TS Tech 27. Dana 43.Takata 31. BorgWarner 36.Teneco 28/29 Companies 29/71 companies
- 15.
- 16. Thailand’s Energy Policy • Enhancing energy related industries & 1 business to be next generation value-creator. • Securing country’s energy supply. 2 • Pricing energy right. 3 • Up-scaling RE mix to 25% in 10 years. 4 • Targeting energy intensity reduction by 25% 5 (based on 2010 level) within 20 years. Source: DEDE (Renewable Energy Asia 2012), as of Sept 12, 2012.
- 17. Alternative Energy Development Plan (AEDP) 2012-2021 AEDP 2012-2021, targeting to replace 25% of total fossil-fuel consumption with RE at the end of 2021. Renewable Energy ( 9,198 MW) Solar power 2,000 MW Wind power 1,200 MW Hydro power 1,608 MW MSW 160 MW Biomass 3,630 MW Biogas 600 MW New forms of RE (3 MW) Geothermal 1 MW energy Wave and 2 MW Tides Source: Ministry of Energy, as of April 2012
- 18. Economic transition from labor intensive to knowledge-based is creating great demand As of Mar 4, 2013
- 19. Opportunities in Machinery • Thailand continues to industrialize, but is dependent on foreign industrial machinery for immediate future. • High demand for: – Food and farm machinery – Alternative energy/energy conservation machinery – Textile machinery – Automotive production machinery – Mould & Die Industry
- 20. Investment Incentives: Metal Products&Parts Manufacturing • 50% reduction of • 50% reduction of • Exempt from machinery duty machinery duty machinery Duty General • Corporate income tax • Corporate income tax • 8 years corporate exemption: In IE-3 years exemption: income tax exemption – In IE-7 years – Outside IE-3 years Zone 1 Zone 2 Zone 3 Exempt from machinery import duties Priority Exempt from corporate income tax for 8 years Examples: Sintered products, mold & die parts
- 21. As of Jan31, 2013
- 22. Biodiversity in Thailand Biodiversity in Thailand is ranked as the eighth most bio-diverse region in the world. Thailand is the world’s highest biodiversity per unit area-hosting several forests types and aquatic habitats. Thailand supports up to 10,000 species of plants, • 980 species of birds, • 300 species of mammals, • 490 species of reptiles and amphibians, • 2,800 species of fishes and • 150,000 species of microbes – accounting for about 10% of all species of living organisms in the world. Source: Thailand BIOTEC Guide 2011/2012 as of July 17, 2012
- 23. Biotechnology: BoI Eligible Activities Seed & Plant R&D Biotechnology Biopharmaceutical agents Diagnostic kits for health, agriculture, food and environment Biomolecule & bioactive compounds using microorganisms, plant cells and animal cells Raw materials and/or essential materials used in molecular biological experiment Biological substances analysis and/or synthesis services Source: A Guide to BOI 2010
- 24. Incentives for Biotechnology Exemption of Biotechnology import duty on machinery Exemption of 8-year-CIT without being subject to CIT exemption cap 50% reduction of CIT on the net profit generated from investment for 5 years after the exemption period Double deductions for transportation, electricity and water costs for 10 years from the date of first income derivation from promoted activity Deduction of infrastructure installation or construction costs from net profit in addition to normal depreciation of not more than 25% of the project. Note: Applications must be submitted to the BOI within Dec 31, 2012
- 25. As of Feb18, 2013
- 26. Policy to SupportHi-Tech Industry Tax Incentives • Exemption of import duties on machinery • Corporate income tax exemption 8 years with no cap • 50% reduction of corporate income tax for 5 years from the expiry date • Double deduction of public utility costs for 10 years • Deduction from net profit of 25% of the investment in infrastructure installation and construction cost in addition to normal capital depreciation for 10 years Eligible • Any Locations except Bangkok • Applicable to designated activities only • Application submission deadlines: Dec 31, 2012 Source: BoI Announcement No.2/2553, April 23, 2010.
- 27. Customized incentives for Higher Value investment projects Projects with investment value at least Bt 30 billion baht (excluding cost of land and working capital) will be eligible for a customized tax incentive package Source: BOI E&E Industries Division as of Feb 5, 2010
- 28. Roles of theBOI • Facilitating market entry—100% foreign ownership in manufacturing and most services eligible for BOI promotion • Reducing initial investment costs through provision of tax incentives • Providing business-related services – Information – Site visits – Subcontracting development • Facilitating business operations – Right to own land – Visas and work permits – Help Desk
- 29. Thailand and theBOI offer: No restrictions 100% foreign on foreign ownership currency LIBERAL INVESTMENT REGIME No export No local content requirements requirements
- 30. Roles of theBOI • Facilitating market entry—100% foreign ownership in manufacturing and most services eligible for BOI promotion • Reducing initial investment costs through provision of tax incentives • Providing business-related services – Information – Site visits – Subcontracting development • Facilitating business operations – Right to own land – Visas and work permits – Help Desk
- 31. Tax Incentives ü Corporateincome tax holidays up to 8 yrs § Additional 50% reductions of corporate income tax for 5 years ü Import duty reductions or exemptions on machinery and raw materials ü Double deduction of public utility costs ü Deductions for infrastructure construction/installation costs
- 32. BOI ZONING AND INCENTIVES Zone: 1 2 3 Incentives: Lower Higher Import Duty Outside I.E Inside I.E Privileges 50% 50% Zone 1 Reduction Reduction 50% Zone 2 Exempt Reduction Zone 3 Exempt Exempt Corporate Outside Inside Income Tax I.E I.E Zone 1 No Privilege 3 years Zone 2 3 years 7 years Zone 3 8 years 8 years
- 33. From Zone-Based to Sectoral Approach Sector Matrix: Incentives to strengthen competitiveness Strategic or Priority Activities • Maximum incentives Zone-Based regardless of location Incentives: • Zone 1 • Customized packages • Zone 2 • Zone 3
- 34. STI Incentives (Optional) Investments and expenditures on: Criteria • Research and development or design • Advanced technology training • Funding educational and research institutions • Contribution to Science and Technology Development Fund Required STI Additional Year Exemption of Removal of Investment & of Corporate Import Corporate Income Expenditures Income Tax Duties on Tax Exemption Exemption Machinery Cap 1% of the first 3 1 ü ü years’ sale or at least Bt150 million, whichever is less 2% of the first 3 2 ü ü years’ sale or at least Bt300 million, whichever is less 3% of the first 3 3 ü ü years’ sale or at least Bt450 million,
- 35.
- 36. Roles of theBOI • Facilitating market entry—100% foreign ownership in manufacturing and most services eligible for BOI promotion • Reducing initial investment costs through provision of tax incentives • Providing business-related services – Information – Site visits – Sourcing • Facilitating business operations – Right to own land – Visas and work permits – Help Desk
- 37. ASEAN SUPPORTING INDUSTRY DATABASE (ASID) www.asidnet.org • Information and profiles of companies in supporting industries and manufacturers of parts and components in 10 ASEAN countries
- 38. One Start OneStop Investment Center More Convenience, less time, more efficiency! 18th Floor, Chamchuri Square Building 319 Phayathai Road, Pathumwan Domestic Call: 0 2209 1100, Inter. Call: (66 2) 209 1100 38 Email: osos@boi.go.th
- 39. Roles of theBOI • Facilitating market entry—100% foreign ownership in manufacturing and most services eligible for BOI promotion • Reducing initial investment costs through provision of tax incentives • Providing business-related services – Information – Site visits – Subcontracting development • Facilitating business operations – Right to own land – Visas and work permits – Help Desk
- 40.
- 41. Foreign Direct Investment Applications 20 16.2 2011 2012 16 +63.5% 12 Belgium Euro Billion 9.9 applications in 9.4 2012: €11.9 million 8 4.9 4 0.6 1.3 1.2 0.8 0.6 0.030.3 0.2 0 Total Japan EU ASEAN USA. Australia Exchange rate: €1 = Bt39.96 in 2012 Source: BOI, as of January 17, 2013
- 42. Trend of BelgiumApplications 150 12 Value 127.8 No.of Projects 11 116.8 120 9 9 94.3 8 8 No. of Projects 90 7 Euro Million 6 6 6 60.3 60 5 59.4 4 3 30 2 2 12.4 11.9 8.1 2.4 1.5 0.1 0 0 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 Source: BOI, as of Feb 28, 2013 Exchange rate: €1 = Bt39.96 in 2012
- 43. Belgium Investment Applications Totals by Sector: 2002 – 2012 Sector Projects € Million Agricultural Products 7 25.0 Minerals and Ceramics 4 66.3 Light Industries/Textiles 16 18.2 Metal Products and Machinery 5 55.7 Electric and Electronic Products 11 0.9 Chemicals and Paper 8 217.2 Services 17 111.7 TOTAL 68 494.9 Source: BOI, as of Feb 28, 2013 Exchange rate: €1 = Bt39.96 in 2012
- 44. Belgium Investments in Thailand
- 45. BOI OFFICE INGERMANY Mr. Chanin Khaochan Director Thailand Board of Investment, Frankfurt Office Bethmannstrasse 58, 60311 Frankfurt am Main, Germany Tel.: +49 69 929 1230 Fax: +49 69 929 123 20 Email: fra@boi.go.th Website: www.boi.go.th 45