Gateway to Asia
Thailand enjoys a strategic location and serves as a gateway into the heart of Asia – home to what is today the largest growing economic market. The country also offers convenient trade with China, India and the countries of the Association of Southeast Asian Nations (ASEAN), and easy access into the Greater Mekong sub-region, where newly emerging markets offer great business potential.
Hub of ASEAN
Thailand was one of the founding members of ASEAN and has been instrumental in the formation and development of the ASEAN Free Trade Area (AFTA). AFTA entered into force on 1 January 2010 for the six original ASEAN (ASEAN-6) members (Thailand, Singapore, Malaysia, Indonesia, Philippines, and Brunei) thereby reducing import duties to zero; the so-called CLMV countries (Cambodia, Laos, Myanmar and Vietnam) will follow suit in 2015.
Thailand is ideally located at the crossroads of Asia, with easy access to the region’s dynamic markets, including its own booming domestic consumer market of 65.12 million people. Thailand has long been a proponent of free and fair trade and its attractiveness as a production base for leading international companies is enhanced by a number of free trade agreements, and Thailand is certain to be a beneficiary of the ASEAN Economic Community (AEC), which will enter into force in 2015.
Source: Bank of Thailand
Social and political stability
Thailand is a foreigner friendly and welcoming Buddhist country. The country's form of government is a constitutional monarchy, with a high reverence for the Thai Monarchy, and devotion to the teachings of Buddhism. And although the vast majority of the people in Thailand are Buddhist, all religions are welcome, and His Majesty the King is the patron of all religions.
Economically, this country of 65.12 million people is characterized by steady growth, strong exports and a vibrant domestic consumer market. Abundant natural resources and a skilled and cost-effective work force help attract foreign investors, and enable them to prosper and develop industry in Thailand.
Source: Bank of Thailand
In addition to a growing highway system that now connects not only every province in Thailand, but also to neighboring countries of Laos, Cambodia and Vietnam, Thailand also offers:
Thailand’s development plans for 2012–2022 include a high speed rail network that will connect north, south, east and west of Thailand, as well as to southern China. The mass transit system in Bangkok is being expanded into the suburbs and air and marine transportation will be further strengthened to meet the pace of growing demand.
- 7 international airports
- Modern city-wide mass transit in Bangkok
- 3G/WiFi and broadband access
- 6 deep sea ports and 2 international river ports, including containers, tank farms and liquid jetties
The country's well-defined investment policies focus on liberalization and encourage free trade. Foreign investments, especially those that contribute to the development of skills, technology and innovation are actively promoted by the government. Thailand consistently ranks among the most attractive investment locations in international surveys, and the World Bank’s 2015 Ease of Doing Business report places Thailand as the 26th easiest country in the world and the second-ranked emerging economy in Southeast Asia in which to do business.
Likewise, the United Nations Conference on Trade and development (UNCTAD) ranks Thailand as the 8th most attractive host economy in the world for 2014-2016.
Government support and incentives
Numerous government agencies support investors. Through the Board of Investment, the government offers a range of tax incentives, support services and import duty exemptions or reductions to an extensive list of promoted activities.
Companies receiving investment promotion privileges from the Board of Investment are not subject to foreign equity restrictions in the manufacturing sector, and there are no local content requirements nor export requirements, as Thailand's investment regime is in total compliance with WTO regulations.
The Board of Investment also coordinates the activity of the One-Stop Service Center for Visas and Work Permits, which enables foreign staff of BOI-promoted companies to obtain work permits and long-term visas within three hours or less.
The BOI also administers the One Start One Stop Investment Center, which opened in November 2009 to facilitate a full range of services and streamline investment procedures by bringing representatives from more than 20 government agencies under one roof.
In addition to the activities of the BOI, other government organizations, such as the Department of Export Promotion and international chambers of commerce, provide invaluable support and a host of other important services.
Long–established and newly emerging industries
With steady economic development and strong support industries, the country's industrial production has grown and diversified rapidly both in long–established and newly emerging industries.
The government has identified 15 activities that are classified as activities of special importance and benefit to the country: Economic forest plantations (except for eucalyptus); Creative product design and development centers; Manufacture of airframes, airframe parts and major aircraft appliances, e.g. engines, aircraft parts, propellers and avionics; Electronic design; Software; Production of electricity or steam power from waste or refuse-derived fuel; Energy Service Companies (ESCO); Industrial zones or technology industrial zones; Cloud services; Research & Development; Biotechnology; Engineering design; Scientific laboratories; Calibration services; Vocational training centers.
Projects in these activities will be granted corporate income tax exemption without being subject to a corporate income tax exemption cap.
Friendly and rich culture
Thailand has gained a well-deserved reputation throughout the world for its gracious hospitality. The friendliness of its people and the diverse nature of Thai culture make visitors feel safe and at home in Thailand. In, 2014 Bangkok was named “World’s Best City” by Travel & Leisure magazine and ranked #6 for overall expat experience in the HSBC Expat Experience Report 2014.
Education and healthcare services
The education standards in Thailand are accepted by many international examining bodies, and a great number of international schools and colleges offer world-class education, while its universities are outstanding.
In terms of healthcare, the country has developed an excellent reputation globally, due to its internationally-certified doctors and medical staff, and modern facilities and equipment. It is so good that one of the fastest-rising tourism sectors is medical tourism, with international patients visiting Thailand to take advantage of Thailand's world-class and extremely affordable health care system. Facts about Thailand
INCENTIVES UNDER THE INVESTMENT PROMOTION ACT
|Population (2014) ||65.12 million|
|ASEAN Population||625 million|
|Minimum Wage||300 Baht/day|
|GDP (2014)||US$404.8 billion|
|GDP per Capita (2014)||US$6,041.1|
|GDP Growth (2014)||0.9%|
|GDP Growth (2015, projected)||3.0-4.0%|
|Export Growth (2014)||-0.3%|
|Export Growth (2015, projected)||0.2%|
|Trade Balance (2014)||US$24.6 billion|
|Current Account Balance (2014)||US$13.1 billion|
|International Reserves (2014)||US$157.1 billion|
|Capacity Utilization (2014)||60.48%|
|Manufacturing Production Index (2014)||168.2|
|Core Inflation (2014)||1.59%|
|Headline Inflation (2014)||1.89%|
|Consumer Price Index (June 2015) (2011=100)||106.64|
|Corporate Income Tax||10-20%|
|Value Added Tax||7%|
In order to obtain investment promotion, the BOI applicant must follow the conditions prescribed by the Board of Investment as specified in the BOI promotion certificate in which the following incentives will be granted:
Policies for Investment Promotion
|Tax Incentives||Non-Tax Incentives|
- Exemption/reduction of import duties on machinery (Section28/29)
- Reduction of import duties for raw or essential materials (Section 30)
- Exemption of corporate income tax and juristic person income tax. (Section 31 and 34)
- A 50 percent reduction of the corporate income tax (Section 35(1))
- Double deduction from the costs of transportation, electricity and water supply (Section35(2))
- Additional 25 percent deduction of the cost of installation or construction of facilities (Section35(3))
- Exemption of import duty on raw or essential materials imported for use in production for export (Section 36)
- Permit for foreign nationals to enter the Kingdom for the purpose of studying investment opportunities. (Section 24)
- Permit to bring into the Kingdom skilled workers and experts to work in investment promoted activities (Section 25 and 26)
- Permit to own land (Section 27)
- Permit to take out or remit money abroad (Section 37)
In order to achieve the vision, the Board of Investment has set investment promotion policies as follows:
source : boi.go.th
- Promote investment that helps enhance national competitiveness by encouraging R&D, innovation, value creation in the agricultural, industrial and services sectors, SMEs, fair competition and inclusive growth
- Promote activities that are environment-friendly, save energy or use alternative energy to drive balanced and sustainable growth
- Promote clusters to create investment concentration in accordance with regional potential and strengthen value chains
- Promote investment in border provinces in Southern Thailand to help develop the local economy, which will support efforts to enhance security in the area
- Promote special economic development zones, especially in border areas, both inside and outside industrial estates, to create economic connectivity with neighboring countries and to prepare for entry into the ASEAN Economic Community (AEC)
- Promote Thai overseas investment to enhance the competitiveness of Thai businesses and Thailand’s role in the global economy