Thailand foreign investment pledges slump 54% in 2020, outlook hazy

[snoop1130]

Thailand foreign investment pledges slump 54% in 2020, outlook hazy

By Kitiphong Thaichareon and Satawasin Staporncharnchai

 

FILE PHOTO: New baht banknotes featuring Thailand's King Maha Vajiralongkorn are unveiled during a news conference at Bank of Thailand headquarters in Bangkok, Thailand, July 3, 2018. REUTERS/Athit Perawongmetha

 

BANGKOK (Reuters) - Foreign investment applications in Thailand dropped 54% to 213 billion baht ($7.12 billion) in 2020 as companies were deterred by the coronavirus pandemic, while this year's outlook remains uncertain, an investment agency said on Wednesday.

 

Japan remains Thailand's biggest investor, with projects worth 76 billion baht, followed by China's 31 billion baht of pledges and the United States' 25 billion baht, the Board of Investment (BOI) said in a statement.

 

Last year, combined domestic and foreign investment pledges fell 30% from a year earlier to 481 billion baht, led by projects in electronics, agriculture and food processing, plus a 165% surge in the medical sector, it said.

 

"The coronavirus outbreak represented both a challenge and an opportunity," BOI chief Duangjai Asawachintachit told a briefing.

 

The agency has yet to set targets for investment pledges this year as the coronavirus situation and the global economy remain highly uncertain, Duangjai said.

 

"There are still a lot of unknowns," she said, adding the agency would try to maintain previous investment levels.

 

It has renewed incentives to encourage the listing of BOI-promoted companies, such as an additional 100% corporate income tax exemption on investment value, Duangjai said.

 

Thailand has not fully lifted entry restrictions on tourists that it imposed last April to reduce infections, although it is accepting some visitors on long-stay visas, who represent only a small fraction of the usual numbers.

 

It has successfully kept infection numbers down and although an outbreak since mid December has seen its cases increase fivefold, its total is relatively low at 23,903, with 80 deaths.

 

In January, the confidence of the Thai Chamber of Commerce hit a 25-month low as the epidemic spread to most of Thailand's provinces and slowed domestic activity, a university survey showed on Wednesday.

 

-- © Copyright Reuters 2021-02-10

 

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[ThailandRyan]

The economy is starting to shrink further.  I do not see a clear path forward out of this dilema unless Thailand rights its ship and starts to utilize some of the countries reserves to prop up the infrastructure.  Sure they are scared as hell to use any and create debt, but when they keep borrowing internally eventually the piper will need to be paid and the bills come due.  Housing market appears in trouble as well.  I just recently observed new cars being driven off of the Mercedes dealership lot and was wondering how people had money to buy these new cars.  This morning I talked with one of the Managers I know that works inside and he walked me around the backside where there were many newer models, 1 to 2 years old, which people were trading in for the newest version.  He then walked me out front where he showed me the new Certified Used Vehicle sign and the lot where they will be selling these from.  He indicated that they had paid the top price for the returned vehicles and the new ones were sold on a promotion that ended at the beginning of February, thus lowering the payments needing to be made by the new owners for a newer vehicle, but still just kicking the can down the street a little further and propping up finances for both the buyers and dealership.  This can not keep going on forever, but with the cutting of payroll taxes, and other incentives given to companies by the Government is what is keeping the wolf from entering the door and devouring the debtors.

[NCC1701A]

11 minutes ago, snoop1130 said:

outlook hazy

like the air.

[connda]

Thailand has the infrastructure to be a world leader in manufacturing as well as an international business hub similar to Singapore - but!  They are going to have to get over their irrational, abject fear and distrust of everything having to do with foreigners, especially Westerners.  And they are going to have to drop their barriers to entry asap.  If they don't, Foreign direct investment will start looking for countries within Asia which are more flexible and receptive. 

[Tropicalevo]

Sadly, this government has no idea what to do next.

[Albert Zweistein]

6 hours ago, connda said:

Thailand has the infrastructure to be a world leader in manufacturing as well as an international business hub similar to Singapore - but!  They are going to have to get over their irrational, abject fear and distrust of everything having to do with foreigners, especially Westerners.  And they are going to have to drop their barriers to entry asap.  If they don't, Foreign direct investment will start looking for countries within Asia which are more flexible and receptive. 

World leader in manufacturing ? Pffffffh.

[donnacha]

The outlook is pretty clear to me but this forum won't let me publish that word ????

[donnacha]

7 hours ago, ThailandRyan said:

I just recently observed new cars being driven off of the Mercedes dealership lot and was wondering how people had money to buy these new cars.

I plan to cash-in a Bitcoin and buy 3 lightly-used Mercedes SUVs for my family as soon as that whole house of cards collapses, but I don't expect that to happen this year.

 

Edited February 10, 2021 by donnacha

[Cake Monster]

With such a large drop in FDI, it can only mean the Investors are turning sour on Thailand.

They will still be Investing, although maybe not such huge amounts, post Covid. And certainly not in Thailand.. Their Investment Money is going elsewhere, because in Business, the most opportunist time to invest is in a recession or large downturn.

[Dogmatix]

I heard the finance minister on CNBC saying that foreign investment was going gangbusters with foreign investors falling over themselves to invest in the EEC. I wonder what happend.