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Japanese firms interested in EEC but need clearer incentive

By   SOMLUCK SRIMALEE
THE NATION

 

JAPANESE corporations are interested in investing in the Eastern Economic Corridor (EEC) scheme, but they need more incentives for public-private partnerships to develop infrastructure there.

 

They also urge the government to clarify the policies and measures to push this project, according to the Japan External Trade Organisation’s Bangkok office.

 

Hiroki Mitsumata, president of Jetro Bangkok, told a press conference yesterday that of the 28 Japanese respondents to a survey Jetro carried out from April 26 to May 3, 24 firms have already made some moves into the EEC area.

 

Ten of them also plan to expand in the EEC when the government starts pushing investment in the zone.

 

The rest have not yet invested in this zone, but could do so if the government sets out a clear incentive policy, he said.

 

The corporate-income-tax privileges the government has approved will entice Japanese companies to invest in the EEC, but many of them are still concerned about the logistics system in the area.

 

“If the government kicks off investment in infrastructure projects such as high-speed rail, the double-track railway system, U-tapao International Airport, expressways and ports, that will support manufacturing in the EEC area,” Mitsumata said. 

 

Japanese investors are also keen on bidding for contracts to build infrastructure projects in the EEC under public-private partnerships, but they need more incentives.

 

“They did not say what they want but they cited the UK’s offer of a guaranteed return on investment in infrastructure projects under public-private partnerships for private firms. When the return from infrastructure services is lower than the guarantee, the UK government will pay the difference,” he said.

 

Meet in Japan 

 

Deputy Prime Minister Somkid Jatusripitak and the Board of Investment (BOI) will meet with investors next Wednesday in Japan. This will provide a venue for 1,200 Japanese firms to ask the Thai government more questions about the policy to drive the EEC to realisation, Mitsumata said.

 

Most Japanese firms agree with the goal of making the EEC a centre of research and innovative technology, but Thailand has to develop its human resources in engineering and science to compete with Singapore and India – the present bases for research and technology in this region. 

 

The policy to develop environment-friendly products, especially automobiles, also lacks enough incentives and a clear direction of what Thailand needs to do and how to promote the green auto industry, he said.

 

The BOI has said those wanting to get the tax incentives under the EEC scheme must apply within this year. This does not give Japanese investors much time to make a decision, because most of them have to study the EEC master plan and then make proposals to their parent companies in Japan. 

 

Many Japanese investors in industries such as automotive, petrochemicals, electronics and home appliances have a mind to invest in the EEC if the incentives are clarified, Mitsumata said.

 

Source: http://www.nationmultimedia.com/news/business/EconomyAndTourism/30317058

 

 

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