Thailand’s Industry Ministry is planning a THB 100 billion Industrial Transformation Fund to modernise industry and support smaller businesses, with the scheme set to be rolled out in phases. The fund aims to attract private-sector co-investment and is expected to help SMEs upgrade machinery and shift towards future industries. Talks are due with the World Bank as the first potential partner.

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The initiative forms part of a broader strategy to tighten investment promotion conditions and prioritise industries that deliver stronger benefits to Thailand. Industry Minister Varawut Silpa-archa said the fund would focus on boosting domestic supply chains and job creation. The ministry has outlined criteria for partners, requiring well-funded and capable firms, either Thai or foreign, that can contribute to industrial transformation.

Discussions will also be held with the Finance Ministry to avoid overlap with the existing SME fund under the Pracharat framework. The new fund is intended to complement existing schemes by targeting smaller operators seeking to modernise and remain competitive. Officials are also reviewing how current investment incentives are structured and whether they still meet national priorities.

On April 23, 2026, the Board of Investment board meet under Deputy Prime Minister and Finance Minister Ekniti Nitithanprapas. The meeting was to address new, stricter conditions for investment promotion. Varawut said support should be limited to industries that provide clear benefits, particularly those using local supply chains and generating employment.

He noted that some industries currently invest in Thailand without using domestic inputs or creating sufficient jobs. “For example, it is not that we do not want the data centre industry. But if it uses Thai-made PCBs, why would we not want it?” he said. He added that policymakers must assess what Thailand gains from such investments, including job creation and use of local raw materials.

Varawut said some sectors already use between 80% and 100% local content, making them more attractive for support. He also highlighted that some existing BOI conditions date back to earlier administrations, including when Banharn Silpa-archa was a minister and may need updating. He argued that current returns for Thailand are not always commensurate with the incentives offered.

The Nation reported that further consultations will take place across government agencies to determine priority industries and timelines for support. The government is expected to refine investment conditions following the BOI meeting and ongoing discussions with financial partners. Officials say the changes are necessary in light of global economic pressures, including war and wider crises.

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Adapted by ASEAN Now Nation 24 Apr 2026

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Sounds like a popularist policy from the Thaksin era.

The government may want to push industrial upgrading, but creating a ฿100bn fund for SME modernisation carries serious risks.

Historic lending patterns show that previously many Thai SMEs struggled with loan repayment, especially when credit was given on vague assumptions and hope, rather than proper financial planning.

Without tight lending requirements, realistic repayment plans, and proper risk assessment, this could easily turn into another cycle of disastrous non‑performing SME loans and bankruptcies.

While it might seem attractive (especially to SMEs), it will need to be far more disciplined than past schemes!