Boi To Make Thailand Investment Heaven

[george]

BoI to attract both domestic, foreign inflows at same time

Top-five role in Asia sought for Thailand

BANGKOK:The Board of Investment (BoI) is working on new promotional strategies and restructuring its approach to attract both domestic and foreign direct investment (DDI and FDI), hoping to make Thailand one of Asia's five prime destinations for foreign investment within the next three years.

Deputy Prime Minister Somkid Jatusripitak said the new strategies would also help the agency set investment targets more precisely, be they by country or industry, and to link industrial clusters and provinces under CEO governors.

He made the comment after a meeting yesterday involving domestic and foreign business leaders, the diplomatic corps, independent organisations and institutions and Thai and foreign investors.

Dr Somkid said the new strategies would underscore the need to lure both domestic and foreign investment with a target next year of 290 billion baht, up from 270 billion baht expected this year, of which 40% would represent domestic investment and 60% foreign.

``We hope to lift Thailand's ranking to one of the five most attractive places for foreign investment by 2006,'' said Dr Somkid.

At this stage, the focus will be on five earlier announced target industrial sectors: agriculture, automobiles, information and communication technology (ICT), fashion and services.

Privileges will be extended to investors in the target sectors and emphasis will be placed on projects that place importance on skill, technology and innovation transfer as well as industrial clusters and import-substitution projects.

On the new strategies to attract foreign investment, three target regions and large operations in those regions were identified.

The BoI aims to attract more businesses dealing with automobiles, ICT and services in North America, with a focus on automobile groups from Michigan such as Delphi, General Motors and Ford.

In Europe, the focus will be put on Germany in automobiles, electronics, ICT and machinery with corporations targeted including DaimlerChrysler, BMW and Siemens. In the United Kingdom the focus will be on automobiles and agriculture with the corporations targeted including Grampian Country Foods.

China, Japan, Asean and India will be the target countries in Asia.

BoI secretary-general Somphong Wanapha said that next year, investment in Thailand from the United States was expected to reach 32 billion, Japan 83 billion, Europe 44 billion, China four billion and Singapore nine billion baht.

Discussing strategies to attract domestic investment, Dr Somkid said new entrepreneurs would be developed together with the skills and of small and medium-sized enterprises. These enterprises will be strengthened by working together with CEO provincial governors to develop industrial clusters in the areas.

To meet that goal, four target regions and 19 industrial clusters were identifies, as well as target countries to invest in each region and industry.

Industry Minister Pinit Charusombat said five country desks were set up as part of the BoI's working restructuring with senior BoI officials taking charge to attract investment from regions such as the United States, China, Japan, Europe and Asean.

--Bangkok Post 2003-12-09

[george]

The Nation on the same topic:

INVESTMENT SHAKE-UP: BoI unveils blueprint

Aims to make Thailand top-five destination

BANGKOK: The Board of Investment (BoI) yesterday announced an ambitious plan to make Thailand one of the world's top-five investment destinations within three years.

Speaking after a meeting to iron out investment promotion strategies, Deputy Prime Minister Somkid Jatusripitak said the setting of strategies and a new working structure for the BoI would enable investment promotion to match the national agenda.

He said a "dual track'' investment-promotion approach would lead to more foreign and domestic investment.

The BoI will next year target Bt270 billion in new investment projects, a 15-per-cent increase on the average over the past five years, Somkid said, adding that foreign investment will account for 60 per cent of the total.

He said investment strategies would be more specific and focused.

In North America, the BoI will pay particular attention to attracting investors from the automotive and information communications technology (ICT) industries. Officials will travel to the US in an attempt to lure potential investors, such as auto companies like Delphi, General Motors and Ford.

Somkid said Germany's automotive electronics, ICT and machinery industries would also be targeted, including companies such as DaimlerChrysler, BMW and Siemens.

In the United Kingdom, the BoI aims to attract investors in the automotive and agricultural industries.

In Asia, the BoI will focus on China, Japan, Asean countries and India, with Thai investors also encouraged to get a foothold in China.

Somkid said the BoI would go gunning for investors from three major Chinese cities: Beijing and its peripheral provinces [agriculture-related, metal products and equipment industries]; Shanghai and its peripheral provinces [metal products and equipment industries]; and Shenzhen and its peripheral provinces [agriculture-related industries].

Thai investors would be encouraged to invest in four areas in China - agro-industry, light industries, and the metal and service industries.

For Japan, Somkid said the Kingdom aimed to attract investments from the automotive, electronics, ICT and agriculture industries.

Targeted cities included Tokyo, Nagoya, Yokohama, Kyoto and Kobe, while targeted companies included Toyota, Honda, Sharp, Toshiba, Sony, Ajinomoto, and small and medium-sized enterprises (SMEs).

For Asean, the BoI aimed to lure automotive, services (biotechnology and logistics), electronics, ICT and software investments.

Somkid said the BoI would target India in a similar fashion to China, with potential industries zeroed in on by Thai investors including automotive engines and parts, construction, frozen foods, tourism and services.

Domestically, BoI would be tasked to help create new entrepreneurs and develop "smart SMEs".

The agency would also work with CEO provincial governors in developing cluster and community enterprises.

Somkid said the North would target IT and software industries from North America, India and Japan, while the Northeast would focus on the research and development (R&D) of government-promoted Otop (One Tambon One Product) products as well as providing industry support.

The central and eastern regions will target biotech industries, R&D for agricultural-related industries, tourism, automotive and electronic industries, and logistics centres. The South aims to lure investments in tourism, transport services, rubber products and Haral foods.

He said the BoI would also be reorganised into five desks - the US, China, Japan, Europe and Asean - each headed by deputy or assistant secretary-generals.

Investment applications will be accepted online next year, and the BoI's working process will become fully automated from 2005.

--THE NATION 2003-12-09

[davidm]

These really are excellent objectives. Pity they are to be implemented by the BOI. Quite how the country will be transformed into the fifth-best place in the world to invest in just over two years is a mystery. I notice they are targetting companies which have already invested in Thailand, so it looks like the main focus of their programme is to encourage existing foreign investors to spend more. This should yield short term gains, but will fall far short of the target they have set.

[kwiz117]

I read an article few weeks back published by one consultancy firm. According to statistics, the Foreigners who live in Thailand and the Companies invest in Thailand have not shown a significant increase compared to the last year.

I can not understand why a Foreign Company should invest in a BOI (Mainly Manufacturing oriented) Company in Thailand due to the high operational cost compared to alternative countries in Asia. The only advantage is the stable government. But all other factors are highly volatile and can change anytime based on what the PM think or read while traveling.

All non-BOI Foreign Companies known to me are complaining about what they get from Thailand right now. Some even planning to shift the base to China. I doubt whether they will be able to convert existing NON-BOI Companies in Thailand to BOI with this type of a setup, unless the Directors and top executives are enjoying Thailand in some other way. You know what I mean..

[ThaiAdventure]

If Thailand wants to see a more long term investment by foriegners then I think they should concentrate more on the small to medium business investors rather than the large corperate monsters. From little acorns giant oaks grow!

I agree with David and Kwizz. Thailand offers very little for the corperate companies when compared to China, India etc. But making life for the the small-medium businesses could benefit imensely from a bit of help and flourish with access to the BOI privelages!

[CTM]

Lets try to read between the lines.

"target sectors and emphasis will be placed on projects that place importance on skill, technology and innovation transfer as well as industrial clusters and import-substitution projects"

In plain English, I would take this to mean:

Hey vile stupid rich farang, spend lots of money building factories and training us Thais. We want to sell to you, but not buy from you. Once we know how to do it ourselves, we (Thais) will find a way to confiscate your investments and send you packing.

We don't want small investors. Too much trouble to track you and apply above practices. Also, you filthy scum will contaminate our country if allowed to run free. You might also bring up the inequities of the Thai system with our well pacified population leading to civil unrest.