Thailand boasts over 1,500 miles of easy-on-the-eye coastline, a rich history and culture, sunshine in abundance and is dubbed the Land of Smiles. It is not hard to see what makes it an attractive destination for tourists and expatriate workers looking for an enviable lifestyle.
But did you realise that Thailand is also an attractive destination for foreign investors, multinational corporations and entrepreneurs?
Below, we drill down into some of the advantages Thailand offers to businesses looking for a suitable Asian base.
Why Thailand is attractive for business
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A steadily-growing
The World Bank describes Thailand as ‘…one of the great development success stories. Due to smart economic policies it has become an upper-middle income economy and is making progress towards meeting the Sustainable Development Goals.’ High praise indeed but not surprising given the impressive GDP growth of the last five years (pre-coronavirus).
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A cohesive economic strategy
In less than a generation, Thailand has made huge advances in terms of both social and economic development. While Covid-19 has put something of a fly in the ointment, as it has everywhere, Thailand has a cohesive economic strategy which will be instrumental in navigating through this difficult period. The 20 Year National Strategy, launched in 2017, and supported by the World Bank, focuses on key economic and social reforms to end poverty, boost shared prosperity and transition to an innovative, inclusive and sustainable economy.
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Ease of setting up business
Doing business in The Land of Smiles is getting easier. This year Thailand has moved up six places in the World Bank’s ease of doing business rankings, taking 21st place out of a total of 190 countries. The annual Doing Business report compares indicators including how easy it is to set up, pay tax, trade across borders etc and Thailand is attractive to businesses based on these criteria.
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Business-friendly government policies
In 2019 the Thai government launched ‘Thailand Plus’, a new stimulus package for foreign investment. The package includes new tax incentives, the simplification of the process to obtain visas and work permits for foreign investors and tax deductions in certain sectors.
Another policy that has been well received by foreign investors and multinationals is the country’s new e-Registration. Introduced by the Department of Business Development, the online system has streamlined the business registration process, reduced the fixed registration fee and allows foreign businesses to appoint a representative to manage the process on their behalf.
The government has also made it easier for companies to file their taxes online and several initiatives have simplified the import and export process which is all good news for both established businesses and those considering setting up in Thailand.
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An expanding list of free trade agreements
Thailand is part of the ASEAN Free Trade Area which promotes trade between its ten members including Singapore and Thailand’s neighbours, Malaysia, Cambodia, Laos and Myanmar. Under the Thailand Plus initiative the Thai government is actively seeking to expand its existing free trade agreements in particular by resuming negotiations with the EU and joining the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP).
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A supportive regulatory environment
The government has made a consistent effort to improve Thailand’s regulatory environment. In 2018 OECD economists noted that ‘…the government has stepped up regulatory reform efforts to foster a more business-friendly environment.’ The result is enhanced transparency and accountability.
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Location, location, location
In the press release announcing the Thailand Plus initiative in 2019, then Deputy Prime Minister Kobsak Pootrakool described Thailand as ‘a prominent hub linking the countries in mainland Southeast Asia’ highlighting its gateway location as one of its great advantages to businesses looking to trade in Asia, the fastest growing economic market in the modern world.
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A domestic market with huge potential
Thailand has a domestic consumer market of more than 69 million people with average economic status rising.
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English is the language of business
Business English is taught in most of Thailand’s universities and the country’s top graduates are well educated, highly skilled and able to do business in English. This makes it easy for multinationals to recruit competent and qualified Thai employees.
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Excellent infrastructure and transport links
Unlike some of its less developed neighbours, Thailand has robust infrastructure and a modern IT and communications network as well as inexpensive and convenient transport links internally, within south-east Asia and beyond.
The advantages listed above have made Thailand a growing international business hub in Asia. The country has attracted big hitters such as General Electric Co, Rolls Royce, Michelin, Bausch & Lomb and Novartis and is emerging as a player within a number of industries including the car industry, aerospace, food manufacturing and biotechnology.
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