Thailand's Board of Investment (BoI) admits that foreign investment is declining

[thailiketoo]

I am only a small business man. But I have a plan gathering dust that could see employment for 10 or 12 Thai's, give a trucking company a minimum of 1 40ft container to move to Laam Chabang every week, buy bottles closures and labels from a business here, have potential to grow the business, fully fund the purchase of land, have a processing plant built, and have it fully funded from Australia, pay tax to the Thai government.

Only thing I need to import the equipment from China as no-one makes it here.

But because of their head in the sand approach the whole thing may end up going to Cambodia or Vietnam......

.

You are probably wise to forego your idea in Thailand and seek out more friendly venues.

Why risk your money and effort only to be left with a fraction of your investment?

You would do better seeking the council of those with successful business in Thailand like Minor International Corp or check with the American Chamber of Commerce in Bangkok rather than failures on Thai Visa.

Losers are losers in any country.

[Thai at Heart]

The ridulous thing is that one has to wonder what have the farangs taken away from thais anyway? The market? What? Why do they want to attack a goose laying golden eggs, paying taxes and employing people. Why?

Thai at Heart ... because our progress and ability to think outside of the box and therefore prosper makes then look stupid. The issue will always come down to education and those at the top don't want the people educated because you cannot control them. It's easier, just as Paddy stated to just blame the foreigner for everything so as to hide the underlying truth that without foreigners and more importantly their investments Thailand would collapse both economically and socially.

What percent (provide a link please) of Thai business is foreign owned or controlled or depends on foreign investment?

https://www.google.co.uk/url?sa=t&source=web&rct=j&ei=DPluVOO4DpH3aoqtgoAD&url=http://www.apeaweb.org/confer/osaka13/papers/Sermcheep_Sineenat.pdf&ved=0CDcQFjAH&usg=AFQjCNFkovqgahcISv0U6VcilVmh8MHlug&sig2=omyLL4osrwZuv-XqAVRghA

27%? If in scan reading this document I understood it

From your link.

"However, the outward FDI (Foreign Direct Investment) has increased rapidly during 2003 2011. Thailand has transformed herself into a net exporter of direct investment in 2011 despite starting as a net importer."

I think a net exporter of foreign investment means that Thailand invests more outside of Thailand than Foreigners invest in Thailand but I'll keep reading.

Well, from a Thai perspective that hasn't transformed itself to a first world economy yet, being a net exporter of FDI isn't really a very good thing is it.

It shows that yes, Thailand as an investment destination isn't as attractive. Of course also, some Thai companies CP and others have been going overseas to buy up companies too.

Its an interesting study. But from what I see, 27% of current GDP as of 2011 is attributable to foreign investment. Pretty significant and obviously has provided a boost to gdp beyond domestic industry.

[DLock]

And the bubble will burst

People have been writing that on Thai Visa for 10 years. There are posters who have grown old and died waiting for that event. Do you have any idea when? I remember listening to a couple of Japanese officers talking about the bubble bursting in the bar at the Mandarin Oriental in 1942.

They have indeed...as well as " final nail in the coffin".

I scoffed for all those years. Having been through it all before Thailand never went backwards despite the challenges. Tourists went up, GDP went up, property was strong, exports grew, investment grew and life for the Government was pretty sweet.

But even I feel that Thailand is in for a really tough economic time in the next few years.

They just seem to have it all wrong. The daily news numbs the predicament that they find themselves in because it is so absurd.

The planets are aligning against them.

There is still time, but not much...

[Thai at Heart]

The issue comes particularly to a head when you understand the demographics of the country.

The amount of people entering the workforce in thailand means that they need to have gdp at 4% just to stand still per capita, China is even higher. The sclerotic growth in the EU isn't quite so bad because they have no population growth.

So, when growth is only 1% it is a really massive problem because it isn't sufficient growth to take in all the people and pay them a pretty small wage by global standards. So cutting off FDI and making it less attractive is absilutely the last thing Thailand should be thinking about because as i showed in an article earlier, it brings ready made, productive jobs to the country instantly. Finding out that FDI is falling, and apparently has been struggling since 2011 should be a massive signal to Thailand that it needs to open its doors more, not close them up to protect itself.

It will only be protecting a dwindling of GDP within the country, and a reduction in wealth within Thailand. Great policy

[thailiketoo]

The ridulous thing is that one has to wonder what have the farangs taken away from thais anyway? The market? What? Why do they want to attack a goose laying golden eggs, paying taxes and employing people. Why?

Thai at Heart ... because our progress and ability to think outside of the box and therefore prosper makes then look stupid. The issue will always come down to education and those at the top don't want the people educated because you cannot control them. It's easier, just as Paddy stated to just blame the foreigner for everything so as to hide the underlying truth that without foreigners and more importantly their investments Thailand would collapse both economically and socially.

What percent (provide a link please) of Thai business is foreign owned or controlled or depends on foreign investment?

https://www.google.co.uk/url?sa=t&source=web&rct=j&ei=DPluVOO4DpH3aoqtgoAD&url=http://www.apeaweb.org/confer/osaka13/papers/Sermcheep_Sineenat.pdf&ved=0CDcQFjAH&usg=AFQjCNFkovqgahcISv0U6VcilVmh8MHlug&sig2=omyLL4osrwZuv-XqAVRghA

27%? If in scan reading this document I understood it

From your link.

"However, the outward FDI (Foreign Direct Investment) has increased rapidly during 2003 2011. Thailand has transformed herself into a net exporter of direct investment in 2011 despite starting as a net importer."

I think a net exporter of foreign investment means that Thailand invests more outside of Thailand than Foreigners invest in Thailand but I'll keep reading.

Well, from a Thai perspective that hasn't transformed itself to a first world economy yet, being a net exporter of FDI isn't really a very good thing is it.

It shows that yes, Thailand as an investment destination isn't as attractive. Of course also, some Thai companies CP and others have been going overseas to buy up companies too.

Its an interesting study. But from what I see, 27% of current GDP as of 2011 is attributable to foreign investment. Pretty significant and obviously has provided a boost to gdp beyond domestic industry.

I can't find it. I think you are reading something else. Feel free to quote the 27% but I think it is closer to 2%.

Foreign direct investment, net outflows (% of GDP) in Thailand was 2.38 as of 2011

http://www.indexmundi.com/facts/thailand/foreign-direct-investment

Thailand Foreign Direct Investment, percent of GDP: For that indicator, The World Bank provides data for Thailand from 1975 to 2013. The average value for Thailand during that period was 2.14 percent with a minumum of 0.2 percent in 1979 and a maximum of 6.54 percent in 1998.

http://www.theglobaleconomy.com/Thailand/Foreign_Direct_Investment/

[thailiketoo]

Well Thai at heart you say foreign investment is 27% and I say it is 2%. One of us is really wrong.

Edited November 21, 2014 by thailiketoo

[Old Man River]

And the bubble will burst

People have been writing that on Thai Visa for 10 years. There are posters who have grown old and died waiting for that event. Do you have any idea when? I remember listening to a couple of Japanese officers talking about the bubble bursting in the bar at the Mandarin Oriental in 1942.

They have indeed...as well as " final nail in the coffin".

I scoffed for all those years. Having been through it all before Thailand never went backwards despite the challenges. Tourists went up, GDP went up, property was strong, exports grew, investment grew and life for the Government was pretty sweet.

But even I feel that Thailand is in for a really tough economic time in the next few years.

They just seem to have it all wrong. The daily news numbs the predicament that they find themselves in because it is so absurd.

The planets are aligning against them.

There is still time, but not much...

There was an excellent article in Barron's in early November.

Due to rising labor costs, Thailand is moving towards the servicing sector (away from manufacturing) for New China (Thailand, VN, Myanmar, Cambodia and Laos). Add to that China and it could be workable. Currently, Thailand is in process of setting up various economic zones for manufacturing which will be linked with China, Myanmar, Cambodia and Laos via their new rail system, once built. This will give the various countries access to Malaysia etc. by land. They, will, of course, need to settle their problems in the south to accomplish this.

Although the FBA amendments do not affect manufacturing, I expect they will as some decision makers may wonder if their sector is next. It will have an immediate affect on new Japanese manufacturing investment as they need their servicing arms who won't increase investment without control (cultural issue) and that doesn't seem likely. Hence, the quick response from the Japanese.

As an offset to negative impacts on the economy in the near term is the gov't's infrastructural spending, which will create jobs, generating household income. If managed properly, they will have more time than it appears. Beyond that is a question.

[Thai at Heart]

Its an interesting study. But from what I see, 27% of current GDP as of 2011 is attributable to foreign investment. Pretty significant and obviously has provided a boost to gdp beyond domestic industry.

I can't find it. I think you are reading something else. Feel free to quote the 27% but I think it is closer to 2%.

Foreign direct investment, net outflows (% of GDP) in Thailand was 2.38 as of 2011

http://www.indexmundi.com/facts/thailand/foreign-direct-investment

Thailand Foreign Direct Investment, percent of GDP: For that indicator, The World Bank provides data for Thailand from 1975 to 2013. The average value for Thailand during that period was 2.14 percent with a minumum of 0.2 percent in 1979 and a maximum of 6.54 percent in 1998.

http://www.theglobaleconomy.com/Thailand/Foreign_Direct_Investment/

That's not the same figure.

This is the total value of the netflow for investment in a year versus annual GDP.

That doesn't quantify how much of the total GDP in Thailand is produced by foreign FDI. Factories last a very long time, so the productive capacity of say a Totyota factory obviously goes way beyond the initial investment.

Just think about it, if tourism is worth 8%, cars alone might make up 10%, and a huge wedge of the productive capacity in the car industry will be FDI.

.

International Trade

In 2009, exports of automotive parts and vehicles accounted for 9.3 percent of the total value of the exports of the country. The major export product was completely built-up units (CBUs). The total value of vehicle and parts exports was 379,486.62 million baht. The value of CBUexports accounted for 63 percent of the total value which was 251,342.94 million baht. CBUexports have also been on an upward trend. This is to say that industry had become more export oriented in completely built-up units than in the past.

If the GDP of thailand was about 300bn USD then, that would mean that car exports alone was 3% of total GDP. So add up all the other foreign investment that is contributing the GDP. It makes up a very very big number.

[thailiketoo]

Its an interesting study. But from what I see, 27% of current GDP as of 2011 is attributable to foreign investment. Pretty significant and obviously has provided a boost to gdp beyond domestic industry.

I can't find it. I think you are reading something else. Feel free to quote the 27% but I think it is closer to 2%.

Foreign direct investment, net outflows (% of GDP) in Thailand was 2.38 as of 2011

http://www.indexmundi.com/facts/thailand/foreign-direct-investment

Thailand Foreign Direct Investment, percent of GDP: For that indicator, The World Bank provides data for Thailand from 1975 to 2013. The average value for Thailand during that period was 2.14 percent with a minumum of 0.2 percent in 1979 and a maximum of 6.54 percent in 1998.

http://www.theglobaleconomy.com/Thailand/Foreign_Direct_Investment/

That's not the same figure.

This is the total value of the netflow for investment in a year versus annual GDP.

That doesn't quantify how much of the total GDP in Thailand is produced by foreign FDI. Factories last a very long time, so the productive capacity of say a Totyota factory obviously goes way beyond the initial investment.

Just think about it, if tourism is worth 8%, cars alone might make up 10%, and a huge wedge of the productive capacity in the car industry will be FDI.

.

International Trade

In 2009, exports of automotive parts and vehicles accounted for 9.3 percent of the total value of the exports of the country. The major export product was completely built-up units (CBUs). The total value of vehicle and parts exports was 379,486.62 million baht. The value of CBUexports accounted for 63 percent of the total value which was 251,342.94 million baht. CBUexports have also been on an upward trend. This is to say that industry had become more export oriented in completely built-up units than in the past.

If the GDP of thailand was about 300bn USD then, that would mean that car exports alone was 3% of total GDP. So add up all the other foreign investment that is contributing the GDP. It makes up a very very big number.

World Bank definition: Foreign direct investment are the net inflows of investment to acquire a lasting management interest (10 percent or more of voting stock) in an enterprise operating in an economy other than that of the investor. It is the sum of equity capital, reinvestment of earnings, other long-term capital, and short-term capital as shown in the balance of payments. This series shows net inflows (new investment inflows less disinvestment) in the reporting economy from foreign investors, and is divided by GDP.

http://www.theglobaleconomy.com/Thailand/Foreign_Direct_Investment/

So what is the foreign direct investment in Thailand? Do you still say 27% or did you read that wrong and it's actually 2%? Or maybe you can cut and past a quote from the article you linked that you maintained said direct investment was 27%? It is a simple question. You wrote, " https://www.google.c...srwZuv-XqAVRghA 27%? If in scan reading this document I understood it"

Edited November 21, 2014 by thailiketoo

[Thai at Heart]

https://en.santandertrade.com/establish-overseas/thailand/foreign-investment

2% is too low. I thought I found 27%. But, here on the Santander site for investment, if this is what I see, it could be 40%

Foreign Direct Investment 2010 2011 2012 FDI

Inward Flow (million USD) 9,147 7,779 8,607

FDI Stock (million USD) 142,498 150,517 159,125

Performance Index*, Ranking on 181 Economies 61 48 - Potential Index**,

Ranking on 177 Economies - 20 -

Number of Greenfield Investments*** 40 55 54

FDI Inwards (in % of GFCF****) 11.4 8.4 8.1

FDI Stock (in % of GDP) 41.8 40.7 40.7

That sounds quite high but then consider what is the total gdp of thailand made up of ? 2/3 is exports. How much of the value of that exports comes from foreign companies? Cars, trucks, electronics, and the list goes on......

Thai companies, the largest of which would be PTT are followed by the banks, but then, the largest companies in Thailand are made up of a lot of foriegn businesses too.

Edited November 21, 2014 by Thai at Heart

[thailiketoo]

https://en.santandertrade.com/establish-overseas/thailand/foreign-investment

2% is too low. I thought I found 27%. But, here on the Santander site for investment, if this is what I see, it could be 40%

Foreign Direct Investment 2010 2011 2012 FDI

Inward Flow (million USD) 9,147 7,779 8,607

FDI Stock (million USD) 142,498 150,517 159,125

Performance Index*, Ranking on 181 Economies 61 48 - Potential Index**,

Ranking on 177 Economies - 20 -

Number of Greenfield Investments*** 40 55 54

FDI Inwards (in % of GFCF****) 11.4 8.4 8.1

FDI Stock (in % of GDP) 41.8 40.7 40.7

That sounds quite high but then consider what is the total gdp of thailand made up of ? 2/3 is exports. How much of the value of that exports comes from foreign companies? Cars, trucks, electronics, and the list goes on......

Thai companies, the largest of which would be PTT are followed by the banks, but then, the largest companies in Thailand are made up of a lot of foriegn businesses too.

My definition of Foreign Direct Investment.

World Bank definition: Foreign direct investment are the net inflows of investment to acquire a lasting management interest (10 percent or more of voting stock) in an enterprise operating in an economy other than that of the investor. It is the sum of equity capital, reinvestment of earnings, other long-term capital, and short-term capital as shown in the balance of payments. This series shows net inflows (new investment inflows less disinvestment) in the reporting economy from foreign investors, and is divided by GDP.

http://www.theglobal...ect_Investment/

If you don't like my definition you post another one. However we can not debate unless we agree on the terms. There is no way for me to reply to you because you keep changing the terms.

I think Thailand could lose it's foreign direct investment and not have an insurmountable problem because it is only 2% of GDP. But since we don't agree what foreign direct investment is any further discussion is fruitless.

[Thai at Heart]

https://en.santandertrade.com/establish-overseas/thailand/foreign-investment

2% is too low. I thought I found 27%. But, here on the Santander site for investment, if this is what I see, it could be 40%

Foreign Direct Investment 2010 2011 2012 FDI

Inward Flow (million USD) 9,147 7,779 8,607

FDI Stock (million USD) 142,498 150,517 159,125

Performance Index*, Ranking on 181 Economies 61 48 - Potential Index**,

Ranking on 177 Economies - 20 -

Number of Greenfield Investments*** 40 55 54

FDI Inwards (in % of GFCF****) 11.4 8.4 8.1

FDI Stock (in % of GDP) 41.8 40.7 40.7

That sounds quite high but then consider what is the total gdp of thailand made up of ? 2/3 is exports. How much of the value of that exports comes from foreign companies? Cars, trucks, electronics, and the list goes on......

Thai companies, the largest of which would be PTT are followed by the banks, but then, the largest companies in Thailand are made up of a lot of foriegn businesses too.

My definition of Foreign Direct Investment.

World Bank definition: Foreign direct investment are the net inflows of investment to acquire a lasting management interest (10 percent or more of voting stock) in an enterprise operating in an economy other than that of the investor. It is the sum of equity capital, reinvestment of earnings, other long-term capital, and short-term capital as shown in the balance of payments. This series shows net inflows (new investment inflows less disinvestment) in the reporting economy from foreign investors, and is divided by GDP.

http://www.theglobal...ect_Investment/

If you don't like my definition you post another one. However we can not debate unless we agree on the terms. There is no way for me to reply to you because you keep changing the terms.

I think Thailand could lose it's foreign direct investment and not have an insurmountable problem because it is only 2% of GDP. But since we don't agree what foreign direct investment is any further discussion is fruitless.

That is new investment on a yearly basis. It comes into the country in order to produce stuff.

In the best years it was 6% of GDP. If you think Thailand can afford to poo poo new FDI. Thailand should never consider it a good idea to not attract FDI. No country should in reality.

That 2% of GDP INVESTED this year, goes on to be producing more GDP next year. It is the very essence of GDP growth because it is investment from outside that by definition isn't being done by Thais. To see that FDI is declining is not a good thing because it automatically limits the potential growth of GDP in furture years. A factory may cost 1mn to build but it will turn out 10mn in VALUE next year.

I do give you 10 out of 10 for trying to wave the Thai flag, but when so many of the well paying jobs in things like the car industry or electronics have been created with FDI, you are absolutely wrong that Thailnd can afford to lose FDI.

I have found a stat on my phone that talks abotu 50% of all exports being generated from foreign companies. Well, exports make up 50%+ of GDP, so 25%+ of all GDP can be attributed to FDI. If you think Thailand has the money and the nous to INVEST in manufacturing capacity and the such to replace the output created by future FDI, good luck to you. I think you may find, that Thailand should be falling over backwards to attract as much FDI as possible in terms of NEW INVESTMENT. Without it, the Thai econsomy will grind to a halt and will really get into trouble when the existing FDI stock isn't replaced by firms because they close down and put up factories elsewhere.

http://asia.nikkei.com/Viewpoints/Perspectives/Hiroshi-Yakame-Why-corporate-Japan-sticks-with-Thailand

A survey a few years ago found that the total sales revenue of all Japanese companies in Thailand was about 40% of Thailand's entire nominal gross domestic product. In other member countries of the Association of Southeast Asian Nations, such as Indonesia and Malaysia, the ratio was about 10%. While these numbers are a little dated, they nevertheless illustrate corporate Japan's crucial role in Thailand.

Wowzers. 40%. I mean, who would misst that if they eventually left

[khunpa]

How does Thailand expect to catch up without outside help? How did South Korea dig itself out of its hole in the late 90's. They had outside help. They liberalised and openend their economy, and today they are doing very well. Thailand and Taiwan are still backward and struggling.

Thailand does not need any help, because it consists of Thai-people who are perfect and smarter than everybody else!

They only have some minor problems like corruption, a horribly bad educational system, lack of International outlook etc. But that is not important and best not talked about, because it might result in someone "losing face". And when under pressure, the best thing is to blame all the others (foreigners, the outside world... whatever.... just not one self!

Admitting that foreign investment is declining is already a big step. Next is now to put blame on somebody else. So why not get rid of those damn foreigners?

Edited November 21, 2014 by khunpa

[thailiketoo]

https://en.santandertrade.com/establish-overseas/thailand/foreign-investment

2% is too low. I thought I found 27%. But, here on the Santander site for investment, if this is what I see, it could be 40%

Foreign Direct Investment 2010 2011 2012 FDI

Inward Flow (million USD) 9,147 7,779 8,607

FDI Stock (million USD) 142,498 150,517 159,125

Performance Index*, Ranking on 181 Economies 61 48 - Potential Index**,

Ranking on 177 Economies - 20 -

Number of Greenfield Investments*** 40 55 54

FDI Inwards (in % of GFCF****) 11.4 8.4 8.1

FDI Stock (in % of GDP) 41.8 40.7 40.7

That sounds quite high but then consider what is the total gdp of thailand made up of ? 2/3 is exports. How much of the value of that exports comes from foreign companies? Cars, trucks, electronics, and the list goes on......

Thai companies, the largest of which would be PTT are followed by the banks, but then, the largest companies in Thailand are made up of a lot of foriegn businesses too.

My definition of Foreign Direct Investment.

World Bank definition: Foreign direct investment are the net inflows of investment to acquire a lasting management interest (10 percent or more of voting stock) in an enterprise operating in an economy other than that of the investor. It is the sum of equity capital, reinvestment of earnings, other long-term capital, and short-term capital as shown in the balance of payments. This series shows net inflows (new investment inflows less disinvestment) in the reporting economy from foreign investors, and is divided by GDP.

http://www.theglobal...ect_Investment/

If you don't like my definition you post another one. However we can not debate unless we agree on the terms. There is no way for me to reply to you because you keep changing the terms.

I think Thailand could lose it's foreign direct investment and not have an insurmountable problem because it is only 2% of GDP. But since we don't agree what foreign direct investment is any further discussion is fruitless.

That is new investment on a yearly basis. It comes into the country in order to produce stuff.

In the best years it was 6% of GDP. If you think Thailand can afford to poo poo new FDI. Thailand should never consider it a good idea to not attract FDI. No country should in reality.

That 2% of GDP INVESTED this year, goes on to be producing more GDP next year. It is the very essence of GDP growth because it is investment from outside that by definition isn't being done by Thais. To see that FDI is declining is not a good thing because it automatically limits the potential growth of GDP in furture years. A factory may cost 1mn to build but it will turn out 10mn in VALUE next year.

I do give you 10 out of 10 for trying to wave the Thai flag, but when so many of the well paying jobs in things like the car industry or electronics have been created with FDI, you are absolutely wrong that Thailnd can afford to lose FDI.

I have found a stat on my phone that talks abotu 50% of all exports being generated from foreign companies. Well, exports make up 50%+ of GDP, so 25%+ of all GDP can be attributed to FDI. If you think Thailand has the money and the nous to INVEST in manufacturing capacity and the such to replace the output created by future FDI, good luck to you. I think you may find, that Thailand should be falling over backwards to attract as much FDI as possible in terms of NEW INVESTMENT. Without it, the Thai econsomy will grind to a halt and will really get into trouble when the existing FDI stock isn't replaced by firms because they close down and put up factories elsewhere.

http://asia.nikkei.com/Viewpoints/Perspectives/Hiroshi-Yakame-Why-corporate-Japan-sticks-with-Thailand

A survey a few years ago found that the total sales revenue of all Japanese companies in Thailand was about 40% of Thailand's entire nominal gross domestic product. In other member countries of the Association of Southeast Asian Nations, such as Indonesia and Malaysia, the ratio was about 10%. While these numbers are a little dated, they nevertheless illustrate corporate Japan's crucial role in Thailand.

Wowzers. 40%. I mean, who would misst that if they eventually left

Impossible to discuss with you. FDI is 2% not 40%. If you have any factual information that FDI is greater than 2% feel free to post it. I am tired of your nonsense and exaggeration. It is impossible to discuss when you don't know what FDI is or refuse to use an economically accepted definition.

You wrote, "I have found a stat on my phone that talks abotu 50% of all exports being generated from foreign companies. Well, exports make up 50%+ of GDP, so 25%+ of all GDP can be attributed to FDI."

I'm afraid you will have to converse with someone else because stats on your phone are not evidence about anything.

World Bank definition: Foreign direct investment are the net inflows of investment to acquire a lasting management interest (10 percent or more of voting stock) in an enterprise operating in an economy other than that of the investor. It is the sum of equity capital, reinvestment of earnings, other long-term capital, and short-term capital as shown in the balance of payments. This series shows net inflows (new investment inflows less disinvestment) in the reporting economy from foreign investors, and is divided by GDP.

I have stopped talking nonsense with you and will no longer respond to any of your posts.

[thailiketoo]

How does Thailand expect to catch up without outside help? How did South Korea dig itself out of its hole in the late 90's. They had outside help. They liberalised and openend their economy, and today they are doing very well. Thailand and Taiwan are still backward and struggling.

Thailand does not need any help, because it consists of Thai-people who are perfect and smarter than everybody else!

They only have some minor problems like corruption, a horribly bad educational system, lack of International outlook etc. But that is not important and best not talked about, because it might result in someone "losing face". And when under pressure, the best thing is to blame all the others (foreigners, the outside world... whatever.... just not one self!

Admitting that foreign investment is declining is already a big step. Next is now to put blame on somebody else. So why not get rid of those damn foreigners?

First you would have to know the amount of Foreign Direct Investment. It is 2% of the Thai GDP. I don't really think they care more than 2%.

http://www.theglobal...ect_Investment/

[shirtless]

Lets hope these same rules will be reciprocated to Thais abroad, Personally i have grown tired of the double standard,

[thailiketoo]

Lets hope these same rules will be reciprocated to Thais abroad, Personally i have grown tired of the double standard,

I believe there are different rules depending on your nationality. What rules do you mean?

[VegasVic]

<script type='text/javascript'>window.mod_pagespeed_start = Number(new Date());</script>

And the bubble will burst

The bubble has already begun to burst in the mainland Chinese real estate market, the Japanese are facing an unsurmountable demographic problem, as the Chinese draw down their imports of commodities Australia will see some substantial bubble bursting as well, and the U.S. and Europe will pay the price for the QE bubble that they have created, the big difference between the U.S. and the EU going forward will be the fact that the U.S. will become a net exporter of energy within the next 5 years. Anyone who tells you that Thailand is immune to "bursting bubbles" was definitely not "in country" back in 1997

[EyesWideOpen]

With the 51% Thai ownership rule here in Thailand, I am surprised that any foreign

company would invest here. I guess at this point the same thought has occurred

to foreign companies as well.... The future will be Vietnam and Myanmar, am thinking

Thailand's time in the sun has come to an end.

[Thai at Heart]

https://en.santandertrade.com/establish-overseas/thailand/foreign-investment

2% is too low. I thought I found 27%. But, here on the Santander site for investment, if this is what I see, it could be 40%

Foreign Direct Investment 2010 2011 2012 FDI

Inward Flow (million USD) 9,147 7,779 8,607

FDI Stock (million USD) 142,498 150,517 159,125

Performance Index*, Ranking on 181 Economies 61 48 - Potential Index**,

Ranking on 177 Economies - 20 -

Number of Greenfield Investments*** 40 55 54

FDI Inwards (in % of GFCF****) 11.4 8.4 8.1

FDI Stock (in % of GDP) 41.8 40.7 40.7

That sounds quite high but then consider what is the total gdp of thailand made up of ? 2/3 is exports. How much of the value of that exports comes from foreign companies? Cars, trucks, electronics, and the list goes on......

Thai companies, the largest of which would be PTT are followed by the banks, but then, the largest companies in Thailand are made up of a lot of foriegn businesses too.

My definition of Foreign Direct Investment.

World Bank definition: Foreign direct investment are the net inflows of investment to acquire a lasting management interest (10 percent or more of voting stock) in an enterprise operating in an economy other than that of the investor. It is the sum of equity capital, reinvestment of earnings, other long-term capital, and short-term capital as shown in the balance of payments. This series shows net inflows (new investment inflows less disinvestment) in the reporting economy from foreign investors, and is divided by GDP.

http://www.theglobal...ect_Investment/

If you don't like my definition you post another one. However we can not debate unless we agree on the terms. There is no way for me to reply to you because you keep changing the terms.

I think Thailand could lose it's foreign direct investment and not have an insurmountable problem because it is only 2% of GDP. But since we don't agree what foreign direct investment is any further discussion is fruitless.

That is new investment on a yearly basis. It comes into the country in order to produce stuff.

In the best years it was 6% of GDP. If you think Thailand can afford to poo poo new FDI. Thailand should never consider it a good idea to not attract FDI. No country should in reality.

That 2% of GDP INVESTED this year, goes on to be producing more GDP next year. It is the very essence of GDP growth because it is investment from outside that by definition isn't being done by Thais. To see that FDI is declining is not a good thing because it automatically limits the potential growth of GDP in furture years. A factory may cost 1mn to build but it will turn out 10mn in VALUE next year.

I do give you 10 out of 10 for trying to wave the Thai flag, but when so many of the well paying jobs in things like the car industry or electronics have been created with FDI, you are absolutely wrong that Thailnd can afford to lose FDI.

I have found a stat on my phone that talks abotu 50% of all exports being generated from foreign companies. Well, exports make up 50%+ of GDP, so 25%+ of all GDP can be attributed to FDI. If you think Thailand has the money and the nous to INVEST in manufacturing capacity and the such to replace the output created by future FDI, good luck to you. I think you may find, that Thailand should be falling over backwards to attract as much FDI as possible in terms of NEW INVESTMENT. Without it, the Thai econsomy will grind to a halt and will really get into trouble when the existing FDI stock isn't replaced by firms because they close down and put up factories elsewhere.

http://asia.nikkei.com/Viewpoints/Perspectives/Hiroshi-Yakame-Why-corporate-Japan-sticks-with-Thailand

A survey a few years ago found that the total sales revenue of all Japanese companies in Thailand was about 40% of Thailand's entire nominal gross domestic product. In other member countries of the Association of Southeast Asian Nations, such as Indonesia and Malaysia, the ratio was about 10%. While these numbers are a little dated, they nevertheless illustrate corporate Japan's crucial role in Thailand.

Wowzers. 40%. I mean, who would misst that if they eventually left

Impossible to discuss with you. FDI is 2% not 40%. If you have any factual information that FDI is greater than 2% feel free to post it. I am tired of your nonsense and exaggeration. It is impossible to discuss when you don't know what FDI is or refuse to use an economically accepted definition.

You wrote, "I have found a stat on my phone that talks abotu 50% of all exports being generated from foreign companies. Well, exports make up 50%+ of GDP, so 25%+ of all GDP can be attributed to FDI."

I'm afraid you will have to converse with someone else because stats on your phone are not evidence about anything.

World Bank definition: Foreign direct investment are the net inflows of investment to acquire a lasting management interest (10 percent or more of voting stock) in an enterprise operating in an economy other than that of the investor. It is the sum of equity capital, reinvestment of earnings, other long-term capital, and short-term capital as shown in the balance of payments. This series shows net inflows (new investment inflows less disinvestment) in the reporting economy from foreign investors, and is divided by GDP.

I have stopped talking nonsense with you and will no longer respond to any of your posts.

The question was what is the value of FDI to the Thai economy.

That has two answers. One is the yearly value as a percent of GDP. The other is what does that stock of FDI produce in a year in the country.

If you want to go down the avenue of basically ignoring obvious consequences of FDI not coming to Thailand.

By the way, what was GDP growth this year? 1%.

So without FDI, the GDP growth would have been negative 1%. Super if you like recessions. Then postulate, what the value of FDI has been to thailand on a yearly basis for the last say 5 years. What would Thai GDP growth have been then?

The reason you don't like to discuss these things is you say things like "Thailand can afford to forgive this FDI", when it is on any measurement a ridiculous arguement which would hurt the Thai economy.

Whether you look at it on a yearly basis (as you insist) or look at it on a macro level (as I am doing) the value of FDI on a short or long term basis to a developing country is absolutely vital.

Even more so for thailand who unlike south Korea or Singapore has largely failed to invest in educating its populous so doesn't have high value domestic industry to push its economy forward.

You act continually as though Thailand is in a position economically to cut off its relationship with foreign business. That would be incredibly stupid right now. Thailand has little or no growth and FDI is falling.

Or is it maybe because FDI is falling that Thailand has no growth?

[evadgib]

https://www.gov.uk/government/publications/overseas-business-risk-thailand/overseas-business-risk-thailand

Edited November 24, 2014 by evadgib

[thailiketoo]

With the 51% Thai ownership rule here in Thailand, I am surprised that any foreign

company would invest here. I guess at this point the same thought has occurred

to foreign companies as well.... The future will be Vietnam and Myanmar, am thinking

Thailand's time in the sun has come to an end.

Americans can own 100%

[Old Man River]

With the 51% Thai ownership rule here in Thailand, I am surprised that any foreign

company would invest here. I guess at this point the same thought has occurred

to foreign companies as well.... The future will be Vietnam and Myanmar, am thinking

Thailand's time in the sun has come to an end.

Americans can own 100%

Also BOI promoted manufacturers.

[thailiketoo]

Impossible to discuss with you. FDI is 2% not 40%. If you have any factual information that FDI is greater than 2% feel free to post it. I am tired of your nonsense and exaggeration. It is impossible to discuss when you don't know what FDI is or refuse to use an economically accepted definition.

You wrote, "I have found a stat on my phone that talks abotu 50% of all exports being generated from foreign companies. Well, exports make up 50%+ of GDP, so 25%+ of all GDP can be attributed to FDI."

I'm afraid you will have to converse with someone else because stats on your phone are not evidence about anything.

World Bank definition: Foreign direct investment are the net inflows of investment to acquire a lasting management interest (10 percent or more of voting stock) in an enterprise operating in an economy other than that of the investor. It is the sum of equity capital, reinvestment of earnings, other long-term capital, and short-term capital as shown in the balance of payments. This series shows net inflows (new investment inflows less disinvestment) in the reporting economy from foreign investors, and is divided by GDP.

I have stopped talking nonsense with you and will no longer respond to any of your posts.

The question was what is the value of FDI to the Thai economy.

That has two answers. One is the yearly value as a percent of GDP. The other is what does that stock of FDI produce in a year in the country.

If you want to go down the avenue of basically ignoring obvious consequences of FDI not coming to Thailand.

By the way, what was GDP growth this year? 1%.

So without FDI, the GDP growth would have been negative 1%. Super if you like recessions. Then postulate, what the value of FDI has been to thailand on a yearly basis for the last say 5 years. What would Thai GDP growth have been then?

The reason you don't like to discuss these things is you say things like "Thailand can afford to forgive this FDI", when it is on any measurement a ridiculous arguement which would hurt the Thai economy.

Whether you look at it on a yearly basis (as you insist) or look at it on a macro level (as I am doing) the value of FDI on a short or long term basis to a developing country is absolutely vital.

Even more so for thailand who unlike south Korea or Singapore has largely failed to invest in educating its populous so doesn't have high value domestic industry to push its economy forward.

You act continually as though Thailand is in a position economically to cut off its relationship with foreign business. That would be incredibly stupid right now. Thailand has little or no growth and FDI is falling.

Or is it maybe because FDI is falling that Thailand has no growth?

The problem is not FDI the problem is hard times in Japan and China making exports go down.

You wrote, "Even more so for thailand who unlike south Korea or Singapore has largely failed to invest in educating its populous so doesn't have high value domestic industry to push its economy forward."

False.

The facts, A number of higher education institutes have recently increased opportunity for various types of students to study at the higher level. In 2007, the Education Council estimated that the number of new students enrolled in bachelors programs between 2007 and 2016 will be approximately 500,000 each year, resulting in between 300,000 to 400,000 new graduates per annum. The only problem is that Thailand’s labour market does not need this number of graduates with bachelors degrees.

http://blog.nationmultimedia.com/print.php?id=2435

Thailand is an export oriented emerging economy. As a result, manufacturing is the most important sector and accounts for 34 percent of GDP. Services constitute around 44 percent of GDP. Within services, the most important are wholesale and retail trade (13 percent of GDP); transport, storage and communication (7 percent of GDP); hotels and restaurants (5 percent of GDP) and public administration, defence and social security (4.5 percent of GDP). Agriculture also makes a significant contribution - around 13 percent of GDP.

http://www.tradingeconomics.com/thailand/gdp-growth-annual

The answer is obvious. Stop putting people on the dole and jump start domestic manufacturing by tax breaks and loans for Thai businesses.

[Thai at Heart]

Impossible to discuss with you. FDI is 2% not 40%. If you have any factual information that FDI is greater than 2% feel free to post it. I am tired of your nonsense and exaggeration. It is impossible to discuss when you don't know what FDI is or refuse to use an economically accepted definition.

You wrote, "I have found a stat on my phone that talks abotu 50% of all exports being generated from foreign companies. Well, exports make up 50%+ of GDP, so 25%+ of all GDP can be attributed to FDI."

I'm afraid you will have to converse with someone else because stats on your phone are not evidence about anything.

World Bank definition: Foreign direct investment are the net inflows of investment to acquire a lasting management interest (10 percent or more of voting stock) in an enterprise operating in an economy other than that of the investor. It is the sum of equity capital, reinvestment of earnings, other long-term capital, and short-term capital as shown in the balance of payments. This series shows net inflows (new investment inflows less disinvestment) in the reporting economy from foreign investors, and is divided by GDP.

I have stopped talking nonsense with you and will no longer respond to any of your posts.

The question was what is the value of FDI to the Thai economy.

That has two answers. One is the yearly value as a percent of GDP. The other is what does that stock of FDI produce in a year in the country.

If you want to go down the avenue of basically ignoring obvious consequences of FDI not coming to Thailand.

By the way, what was GDP growth this year? 1%.

So without FDI, the GDP growth would have been negative 1%. Super if you like recessions. Then postulate, what the value of FDI has been to thailand on a yearly basis for the last say 5 years. What would Thai GDP growth have been then?

The reason you don't like to discuss these things is you say things like "Thailand can afford to forgive this FDI", when it is on any measurement a ridiculous arguement which would hurt the Thai economy.

Whether you look at it on a yearly basis (as you insist) or look at it on a macro level (as I am doing) the value of FDI on a short or long term basis to a developing country is absolutely vital.

Even more so for thailand who unlike south Korea or Singapore has largely failed to invest in educating its populous so doesn't have high value domestic industry to push its economy forward.

You act continually as though Thailand is in a position economically to cut off its relationship with foreign business. That would be incredibly stupid right now. Thailand has little or no growth and FDI is falling.

Or is it maybe because FDI is falling that Thailand has no growth?

The problem is not FDI the problem is hard times in Japan and China making exports go down.

You wrote, "Even more so for thailand who unlike south Korea or Singapore has largely failed to invest in educating its populous so doesn't have high value domestic industry to push its economy forward."

False.

The facts, A number of higher education institutes have recently increased opportunity for various types of students to study at the higher level. In 2007, the Education Council estimated that the number of new students enrolled in bachelors programs between 2007 and 2016 will be approximately 500,000 each year, resulting in between 300,000 to 400,000 new graduates per annum. The only problem is that Thailands labour market does not need this number of graduates with bachelors degrees.

http://blog.nationmultimedia.com/print.php?id=2435

Thailand is an export oriented emerging economy. As a result, manufacturing is the most important sector and accounts for 34 percent of GDP. Services constitute around 44 percent of GDP. Within services, the most important are wholesale and retail trade (13 percent of GDP); transport, storage and communication (7 percent of GDP); hotels and restaurants (5 percent of GDP) and public administration, defence and social security (4.5 percent of GDP). Agriculture also makes a significant contribution - around 13 percent of GDP.

http://www.tradingeconomics.com/thailand/gdp-growth-annual

The answer is obvious. Stop putting people on the dole and jump start domestic manufacturing by tax breaks and loans for Thai businesses.

I thought subsidies were off the table. Thai businesses just got their corporation tax cut a couple of years ago. The govt has a deficit and is trying to raise money, not give more away. This only works is the govt can capture more revenue from the increased activity, or the deficit gets bigger.

The answer from an FDI perspective is to get more than your fair share. FDI has been rising in neighboring countries for various reasons, every cent of which could maybe have come to Thailand. Floods, corruption and coups don't help to attract FDI.

There are many policies that can be changed to attract this, but basically the numbers shown elsewhere show it has been falling since 2011.

FDI is vital for Thailand to grow, and if new FDI keeps falling as a percentage of GDP, it will make it very hard for Thailand to grow in the future. As I showed earlier, of total GDP, foreign investment is responsible for producing a massive percentage. If that stock is not replaced with new FDI, and companies start to leave, can domestic industry replace it?

I doubt it.

Yes thailand produces huge volumes of graduates. Just not to the same quality as Singapore or South Korea.

On the dole? They can't even get Thais to work for 300 a day so they import millions from Cambodia and Myanmar. Reportedly there is no unemployment and every Thai is too busy counting his Ferraris on the driveway to need mor FDI

Edited November 24, 2014 by Thai at Heart