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Investment Opportunities

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Title: Investment Opportunities


1
Investment Opportunities in Thailand ??????
Thailand Board of Investment ?????????(BOI)
2
Where Success Stories Begin (??????)
  • Thailand Macroeconomic Investment Performance
  • ???????????
  • Why Thailand
  • ??????
  • Thailand Board of Investment
  • ?????????(BOI)
  • Investment Opportunities
  • ????

3
  • ??????
  • Population (??) 64.8 million (6480?)
  • 69 of population between ages 15-64
    (69?????15??64?)
  • Population growth rate 0.91 (????? 0.91)
  • Literacy 96 (??? 96)
  • Religion Buddhist 94 (??94??)
  • GDP rate 2005 4.5 (2005?GDP???4.5)
  • 2006 4.2-4.9 (2006?GDP???4.2-4.9)
  • GDP per capita 2,794 (??GDP2,794??)
  • GDP 148.5 billion (GDP1485???)
  • Agriculture 10 (?? 10)
  • Manufacturing 35 (??? 35)
  • Services 52 (??? 52)

Thailand
Projected (??)
4
Thailand Rated 3 Most Attractive FDI Location
in Asia by UNCTAD (?????????????????????????????)
  • UNCTAD survey of worlds 325 largest
    transnational corporations UNCTAD
  • (?325????????)
  • Asian region has most positive FDI prospects
  • (?????????????)
  • Overall, Thailand ranked 9 in world
  • (????????)

Ranking of FDI Prospects in Asia (2005-2008) ?????????? Ranking of FDI Prospects in Asia (2005-2008) ??????????
Top 1 China??
Top 2 India??
Top 3 THAILAND??
Top 4 Vietnam??
Top 5 South Korea??
UNCTAD Global Investments Prospects Assessment,
Sept. 2005
5
Japan manufacturers rank Thailand 3
globally (??????????????)
Promising Countries/Regions for Overseas Business Operations FY2005 (2005?????????????/??) Promising Countries/Regions for Overseas Business Operations FY2005 (2005?????????????/??)
Rank Country/Region (??/??)
1 China (??)
2 India (??)
3 Thailand (??)
4 Vietnam (??)
5 U.S. (??)
6 Russia (???)
7 Korea (??)
8 Indonesia (?????)
9 Brazil (??)
10 Taiwan (??)
Includes production, sales, RD, outsourced operations (?????????????) Includes production, sales, RD, outsourced operations (?????????????)
  • Thailand Top Factors (??????)
  • Inexpensive labor force (??????) (50.3)
  • Growth potential of the market (??????) (46.2)
  • Political and social stability (??????) (43.4)
  • Base for exports (????) (33.8)
  • Supply base for assemblers (??????) (30.3)
  • Developed local Infrastructure (???????) (26.9)
  • Risk diversification (????) (22.1)
  • Tax incentives for investment (??????) (21.4)
  • Present Domestic market size (??????) (20.7)
  • Base of exports to Japan (????????) (19.3)

Source Outlook for Japanese FDI conducted by
Japan Bank for International cooperation (JBIC),
Nov. 2005 (???? ??????????) 2005?11?????????
6
Updates on FDI in Thailand (????????) BOI
Statistics (???????)
Foreign Investments Surge in 2005 2005 ????????
7
Value of Net Applications Increasing (???????)
Total investment applications (??????)
Unit ?? Billions US Dollars 10 ???
10.6
109
FDI increases 62 to 12.5 billion FDI ?? 62?125?
22
35
8
Net Applications by Sector (???????)
17.61
15.93
Unit ?? Bil USD (10?)
Services, utilities and infrastructure
??? ?????????
4.41
Total investment applications ??????
3.95
Chemicals, paper plastic ????????
2.74
2.90
Electrical Electronics ?????
2.13
7.618
Metal processing, Machinery Auto ????????????
6.233
2.06
1.34
Light industry, fashion, furniture ??? ???????
1.44
3.65
0.98
1.4
0.31
0.64
0.38
1.57
Minerals, steel, and ceramics ??? ?????
0.79
3.94
1.56
1.51
3.28
0.37
0.45
0.03
Agro-Industry ????
0.49
1.33
1.02
1.87
0.85
2002
2003
2005
2004
9
Major Investing Countries from 2003 to 2006
(2003?2006???????)
Unit Million Baht (??????)
Countries/Regions (??/??) Net Applications (????) Net Applications (????) Net Applications (????) Net Applications (????) Net Applications (????)
Countries/Regions (??/??) 2003 2004 2005 Jan-Jun 2005(16?) Jan-Jun 2006(16?)
Japan (??) 106,374 101,856 175,313 114,943 51,997
USA. (??) 47,446 35,223 7,883 4,763 25,417
ASEAN(??) 21,114 35,072 36,295 17,411 21,847
Hong Kong (??) 12,435 2,590 11,200 468 14,033
Taiwan (??) 7,931 9,305 11,443 5,084 7,822
EU. (??) 36,431 32,066 35,710 19,926 7,107
P.R.C (??) 2,333 3,483 121,959 992 973
Australia (????) 6,284 551 908 159 934
India (??) 3,445 2,096 856 445 640
10
Major Investing Countries from 2003 to 2006
(2003?2006???????)
(??)
11
China Investment Applied for BOI (???????????????)
Unit Million US (??????)
12
Major Chinese and Fujian Investors in Thailand
(??????????????)
Company (??) Business (??)
Xiamen Airlines Co., Ltd. (????????) Air Transportation Services (????)
CHINA WORLD BEST (????) Natural/Synthetic Fibers/Citric Acid/Fiber Residue/Printing Finishing Textile (??/???/???/????????)
Holley Group Electric (Thailand) (??(??)???????? ) Electricity Power Meters (??)
TCL Electrical Appliances (????)
ZHONGFU (??) Preformed Bottle, Plastic Bottle (????)
DONGYUN (??) Printing Roller (???)
TONG REN TANG (???) Medicine (??)
13
Thailand Investment in China (????????)
Unit Million US (??????)
14
Major Thai Investors in China and
Fujian (??????????????)
Company (??) Business (??)
Chia Tai Group (????) Feed Meal/Poultry/Fishery/Lotus Super Store/Bio-chemical/Motorcycle/Real Estate/Banking (??/??/??/????/??/???/???/??)
Thai Airway (??????) Air Transportation Services (????)
Xiamen Day Bright Foods (??????????) Food Processing (????)
East Asia Sugar Group (Mitrphol) (????) Sugar Plants (??)
Saha Union (????) Power Plants/International School (??/??)
Banpu (??) Coal Mines (??)
15
Why Thailand ??????
16
Top 20 Ease of Doing Business
(????????20?)
1 New Zealand ??? 6 Australia ???? 11 Ireland ??? 16 Estonia ????
2 Singapore ??? 7 Hong Kong ?? 12 Iceland ?? 17 Switzerland ??
3 United States ?? 8 Denmark ?? 13 Finland ?? 18 Belgium ???
4 Canada ??? 9 United Kingdom ?? 14 Sweden ?? 19 Germany ??
5 Norway ?? 10 Japan ?? 15 Lithuania ??? 20 Thailand ??
17
Suvarnabhumi International Airport (?????????)
1st Phase 76 flights / hour (76??/??) ???
45 million passengers/year
(4500???/?) 3 million metric
tons/year (300???/?)
State-of-the-Art Cargo Systems
(????????)
www.suvarnabhumiairport.com
Opening in 2006 2006???
18
Excellent Industrial Location (??????????)
Electronics (??)
Automotive (??)
Food (??)
Energy Petrochemical (?????)
60 Industrial Estates (??60?????)
Rubber (??)
19
Efficient Logistics Network (???????) Seaport
(??)- Land Transport (????)- Airport (??)

Suvarnaphumi International Airport
Donmuang International Airport
Laem Chabang Seaport
20
Comparative Business Costs (??????)
Thailand (??) Singapore (???) China (??) India (??) Vietnam (??)
Industrial Electricity (Peak) ????(??) US/kwH (??/???) 6.29 6.75 10.43 5.98 10.80
Industrial Electricity (Off Peak) ????(???) US/kwH(??/???) 2.82 4.19 6.70 4.68 6.35
Water Costs (Industry) ??(??) US/cubic m (??/????) 0.38 1.52 0.18 1.63 0.43
Sources (????) Electricity ASEAN Center for
Energy (?? ??????) Water costs Various
government agencies (??????????)
21
Workers Monthly Wage (General Industry) (????
(????))
Unit US ????
Singapore ??? 455-604 Shenzhen ?? 100-247
Kuala Lumpur ??? 205 Manila ??? 182
Shanghai?? 172-301 Bangkok?? 146
Dalian?? 102-247 Jakarta ??? 131
Source JETRO ?????????
22
Monthly Office Rent (??????)
Unit US/sq. m. ????/???
Singapore??? 34.79-36.06 Jakarta ??? 22-26
Beijing ?? 34-40 Shenzhen ?? 18.59
Shanghai ?? 28.35 Kuala Lumpur??? 9.96-14.21
Guangzhou?? 20.32 Bangkok?? 11.67
Source JETRO ?????????
23
Thailand Top in Investment Survey (???????????)
JETRO Rank Thailand is the most favorite country
as the production base in 2006-2016
(???????????????20062016??????????)
Industry (??) Rank 1 (???) Rank 2 (???) Rank 3 (???)
Petrochemical (??) Thailand (??) India (??) Malaysia (????)
Plastic Product (????) Thailand (??) Vietnam (??) China (??)
EE (?????) Vietnam (??) Thailand (??) India (??)
Auto (???) Thailand (?? ) Vietnam (??) India (??)
Auto Parts (?????) Thailand (??) India (??) Vietnam (??)
Source JETRO Survey March 2006 ????????????2006
?3???
24
Strategic Location to Asian Markets
(???????????)
(Countries and populations
?????)
Japan?? 128 million 1.28 ? Japan-Thailand
Economic Partnership Agreement ?-???????
China ?? 1.3 billion 13 ? Early Harvest
China-Thailand China-ASEAN FTA
???????????
India ?? 1.1 billion 11 ? Early Harvest
Agreement ??????
Taiwan ?? 23 million 2300?
Thailand ?? 64 million 6400? No. of Tourists
gt13 mil/yr ??????1300???
ASEAN ?? 550 million 5.5 ? AFTA ?????
Australia ???? 20 million 2000? TAFTA ?????
New Zealand ??? 4 million 400? Closer Economic
Partnership ??????
25
Major Trading Production Hub (?????????) Top
Exports Imports for Jan-Jun 2006
(2006?1??6????????)
Source ? Thai Customs ????
Top 10 Exports ??? 10 ? Top 10 Exports ??? 10 ? Mil. USD ??
1 Automatic data processing machines and parts ?????????? 6,875
2 Motor cars, parts and accessories ????? 4,494
3 Electronic integrated circuits ???? 3,316
4 Rubber ?? 2,438
5 Polymers of ethylene, propylene, etc in primary forms ???? 2,171
6 Precious stones and jewelery ?? 1,807
7 Radio-broadcast receivers, television receiver and parts ??????? 1,631
8 Garments ??? 1,547
9 Chemical products ???? 1,517
10 Refine fuels???? 1,462
Top 10 Imports ??? 10 ? Top 10 Imports ??? 10 ? Mil. USD ??
1 Crude oil ?? 9,684
2 Machinery and parts ?????? 5,839
3 Electrical machinery and parts ??????? 4,802
4 Chemicals ???? 4,509
5 Electrical circuit panels ??? 4,377
6 Iron, steel and products?? ??? 3,470
7 Computers accessories and parts ??/??/?? 3,430
8 Other metal ores, metal waste scrap, and products ???????????????? 2,827
9 Jewellery including silver bars and gold ???????? 1,989
10 Parts and accessories ??? 1,509
26
Liberal Investment Policy (?????????)
  • No restrictions on foreign currency remittances
  • ?????
  • No export requirement
  • ?????
  • No foreign equity restrictions in manufacturing
    sectors ???????????
  • No local content requirement
  • ??????

27
6 Target Sectors (6 ?????)
Automotive (??)
Electronics and ICT (?????????)
Alternative Energy (????)
Fashion (?????)
  • Garments, Leather, Jewelry (????????)

Agro-Industry (????)
  • Food and Rubber Products (???????)

High-Value Added Services (?????)
  • Regional Operating Headquarters (??????)
  • Film and Animation (?????)
  • Software Development and others (???????)

28
Basic Incentives Package ??????
29
The Board of Investment Basic Incentives and
Measures ???????????
  • Non Tax Incentives ?????
  • Guarantees against nationalization and price
    controls
  • (???????????)
  • Permission to own land and bring in foreign
    experts
  • (?????????????)
  • Tax Incentives ????
  • Tax exemption /reduction on imported machinery
    and input
  • (?????????????)
  • Income tax exemption (???????)
  • Support Services ????
  • Advisory and information provision (???????)
  • Publications (???)

30
Incentive Schemes ????
Zone-Based Incentive Max 8 years tax holiday ??????????? 8 ? Customized-Based Incentive Package Max 8 years tax holiday ??????? 8 ???? Long-Term, High-Value EE Incentive Package ???????????????
Customized Packages ???? -Clusters ???? -STI ???????? -Target Sectors ???? Priority Activities receive maximum 8-years ?????????8???? New! ??! Special Incentives for Electrical Electronics ????????????
NEW!
31
BOI Basic Promotion Packages ?????????
  • 3 Zones
  • 3 ???
  • 1 Million Baht Minimum Investment
  • ?????1????

32
Basic Zone-Based Corporate Income Tax Exemptions
???????????
Zone (??) Inside IE (?????) Outside IE (?????)
1 3 Years (?) Not Exempt (???)
2 7 Years (?) 3 Years (?)
3 8 Years (regardless of location) (8 ? ?????) 8 Years (regardless of location) (8 ? ?????)
Laem Chabang IE and Rayong IE receive 8 years
?????????????? 8 ?
33
Import Duty Privileges ?????
Zone ?? Machinery Import Duties ??????? Raw Materials Import Duties ??????
1 50 Reduction ?? 1 Year Exemption ??? 1 ?
2 50 Reduction ?? (100 in industrial estates ???????) 1 Year Exemption ??? 1 ?
3 Exempt ??? 5 Year Exemption ??? 5 ?
34
Additional Zone 3 Incentives ????????
Outside IE ?????
Inside IE ?????
36 provinces 36 ??
?
50 reduction of income tax for 5 years
(????????? 5 ?)
Double deduction of water, electricity, transport
costs for 10 years (?????????????? 10 ?)
?

25 deduction of infrastructure installation or
construction costs (???????? 25 ???)
?
?
35
Additional Zone 3 Incentives ????????
22 Least Developed Provinces 22 ?????? Inside IE ????? Outside IE ?????
50 reduction of income tax for 5 years ??????????? ? ?
Double deduction of water, electricity, transport costs for 10 years ???????????????? ? ?
25 deduction of infrastructure installation or construction costs ???????? 25 ??? ? ?
4 provinces added ??4 ? Chaiyapum ??? Nong
Khai ?? Ubon Ratchathani ?? Udon Thani ?? (??)
36
  • Auto Autoparts Industry
  • (???????)

37
Thailand Automotive Hub of ASEAN (??????????)
  • 2005 production 1.13 million units Export
    0.44 million units (2005?????1.13??? ??40??)
  • Largest in South East Asia (???????????)
  • Capacity will be 1.8 million units in 2010
  • (2010????????180??)
  • Worlds largest production of one-ton pickup
    trucks
  • (?????????????)
  • 847,301 units in 2005 (2005????76??)

38
Thailand Automotive Hub of ASEAN (??????????)
  • 14 assembly plants from Japan, US, and Europe
    (14?????,????????????)
  • Over 700 first tier suppliers (??700????????)
  • 2005 motorcycle production 2.36 millions units
  • (2005????????3???)

39
Automotive Industry in Thailand (???????)
Thousand Units (????)
??
??
??
Ave. Growth 34 per year (1998
2005) 1998-2005???????34
40
Road-map of Thailand Automotive
Industry (?????????)
More than 1.8 Mil. (??180?)
Thailand Detroit of Asia (?? ?????)
More than 1 Mil. (??100?)
Rank 10 Of the world (??????)
Rank 14 Of the world (???????)
More than 0.1 Mil. (??10?)
More than 0.01 Mil. (??1?)
Present(??)
Future (??)
Past (??)
41
Motorcycle Industry in Thailand (????????)
Thousand Units (????)
??
??
??
Ave. Growth 30 per year (1998
2004) 1998-2004???????30
42
Investment Opportunities in Auto
Industries (?????????)
  • Auto assembling for local and export under AFTA,
    FTA
  • (AFTA, FTA ??????????????)
  • Auto part manufacturing to serve domestic and
    export markets (??????????????)
  • Motorcycle production for local and export
    markets
  • (???????????)
  • NGV equipments plants, NGV target 120,000 units
    by 2008 (?????????????2008?????12??)

43
  • Electronics and Electrical Products
  • (???????)

44
Electronics Electrical Products(???????)
Electronics and Electrical Industry (???????)
  • Export over US36 Billion in 2005, 1/3 of total
    export (2004??????330???, ??????1/3)
  • Major products HDD, IC, PCB, TV, A/C other WG
  • (?????????,????,?????,??,???????)
  • Worlds largest producer of HDD in 2005
  • (2005??????????????)
  • Strong supporting industries for electrical
    appliances
  • (??????????????)
  • Compressor, motor, plastic metal parts
  • (???,???, ???????)

45
New Incentive for Long Term Integrated Projects
(??????????)
New BOI Incentive for EE Industry
(????????????????)
  • Package for Long-term Investors (???????????)
  • Must plan to invest more than one project
  • (?????????????)
  • All projects in electrical/electronics supply
    chain
  • (????????/?????)
  • Previous projects can be combined into follow-on
    projects, automatically extending income tax
    holidays
  • (?????????????????,?????????????)

46
New Incentive for Long Term Integrated Projects
(??????????)
New BOI Incentive for EE Industry
(????????????????)
2006
2007
2011
2019
Project (??) A
Re-invest (?????)
5 years tax holiday (??5??????)
Last project (?????)
5 years tax holiday (??4??????)
8 years tax holiday (??4??????)
Note Original project and all re-investments
are combined into one project. (?????????????????
)
47
Investment Opportunity in EE (?????????)
HIGH (?)
Opportunity in the Missing Links ????????
Telecom (??) PC (????) CE (????)
IC Design (??????)
Wafer (??)
Components
Industrial Value-Added (????)
Missing Links (????)
IC (????)
Missing Links (????)
PCB (?????PCB)
Thailand imported EE parts and products US24
billion in 2004 2004??????????????240???
LOW (?)
Downstream (??)
Upstream(??)
Midstream (??)
Industries??
48
Compulsory STI expenditures for
high value long-term EE investments
(??????????????STI????)
All high value long-term investment projects must
meet the following STI criteria during operation
of final project ???????????????????????????STI??

STI requirements (STI ??)
Zone 1 ????
Zone 2 ????
Zone 3 ????
  • RD (??)
  • Advanced Technology Training
  • (??????)
  • Funding educational /research institutions
  • (??/??????)
  • 2 of total 1st 3-year sales or at least 500 mil
    Bth.
  • ??????? 2???? 5 ???
  • 1.5 of total 1st 3-year sales or at least 400
    million baht
  • ???????1.5????4???
  • 1of total 1st
  • 3-year sales or at least 300 million baht
  • ???????1????3???


Required total STI expenditures are calculated
from the first 3-year sales of the final project
and previous projects combined.
???STI???????????????????????
49
Fashion Industry (?????)
  • Global Position (????)
  • 13th largest exporter of garments
  • (?????????13?)
  • 5th largest diamond-cutting center
  • (???????????5?)
  • Contribution to Domestic Economy (????????)
  • Employment gt 2 million people
  • (??????200?)
  • Export gt US11 billion in 2005 (2005?????110???)

50
Investment Opportunities in Fashion
Industry (??????????)
  • Textile Industry (????)
  • Functional Fiber (????)
  • Nano Textile (????)
  • Special Fiber (????)
  • Textile Printing Technology (??????)
  • Jewelry Industry (???)
  • Artificial Jewelry (???????)

51
BOI Online Services ?????????
Facilitation (????)
  • BOI Applications download, submit online
    (?????????)
  • Laws, regulations, information on investing and
    doing business in Thailand
  • (?????????????????)
  • Statistics on BOI approvals
  • (?????????)
  • Ask questions through website
  • (??????)
  • Free monthly e-newsletter BOI Investment Review
  • (?????????????????)

www. boi.go.th
52
BOI Overseas Offices ????????
Frankfurt (????)
New York (??)
Paris (??)
Tokyo (??)
Osaka (??)
Shanghai (??)
LA (???)
53
BOI Support Services ???????
Sectional divisions to guide you through the
process ????????????
54
THAILAND OF INVESTMENT ??-?????
WHERE SUCCESS STORIES BEGIN ??????
WWW.BOI.GO.TH
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