Investment in Thailand : Valued-packed Opportunities

Transcription

1 Investment in Thailand : Valued-packed Opportunities Satit Chanjavanakul Secretary General Thailand Board of Investment 17 September

2 Outline of Presentation 1. Current Investment Environment 2. Investment Opportunities 3. Recent Investment Promotion Policies : Enhancing Future Growth 4. Investment Promotion Strategies : Thailand Investment year (2)

3 1. Current Investment Environment (3)

4 Strong Net Applications Value Billion US$ US$ 20 US$17.3 US$17.8 US$15 US$6.9 US$ Year 2007 exchange rate 32 Baht : 1US$ 2007 (4)

5 Value of Investment Promotion Applications Unit : Billion Baht 700 Transport, Infrastructure, Services Chemical, Paper and Plastics Electronics and Electrical appliances Automotive, Auto parts, Machinery Fashion, Furniture Metal, Ceramics Processed agricultural products (5)

6 Major Foreign Investors ( ) (US$21.2 Bn) 600 TOP 3 : Japan, EU, USA Bht (US$6.4 Bn) 221 (US$6.3 Bn) (US$2.6 Bn) 0 Japan EU USA Taiwan (6)

7 Applications for Investment Promotion (No. of projects) Jan-Aug Units : No. of projects months months months 2008 Services Chemical E&E Auto Fashion Metal Agro (7)

8 Value of Investment Promotion Applications Jan-Aug Units : Billion baht months months months 2008 Services Chemical E&E Auto Fashion Metal Agro (8)

9 World Bank s Ease of Doing Business Singapore New Zealand United States Hong Kong Denmark United Kingdom Ireland Canada Australia Norway Japan Thailand Malaysia Korea Taiwan China Vietnam Indonesia Philippines Laos PDR Source: World Bank Study: Doing Business in 2009 Criteria Starting a business Hiring and firing workers Enforcing contracts Access to credit Closing a business Registering property Dealing with licenses Paying taxes Trading across borders Investor protection (9)

10 JBIC Survey of Manufacturing Companies Most attractive countries for FDI FY 2007 N o. (%) FY 2006 N o. (%) FY 2005 N o. (%) FY 2004 N o. R ankk C hina C hina C hina C hina India India India T hailand d V ietnam V ietnam T hailand India T hailand T hailand V ietnam V ietnam R ussia U.S U.S U.S U.S R ussia R ussia R ussia 49 7 B razil 47 9 B razil 45 9 K orea Indonesia nesia 48 8 Indonesia 46 9 K orea 44 9 Indonesia 45 9 K orea 44 9 K orea 32 6 Indonesia 39 8 B razil 36 7 T aiw an T aiw an 24 5 T aiw an 27 6 T aiw an 32 7 M alaysia M alaysia M alaysia 22 5 M alaysia 23 5 S ingapore M exico G erm any M exico 16 3 G erm any P hilippines P oland 15 3 G erm any 14 3 B razil G erm any C zec h R e p. P hilippines 13 3 P hilippines C zech R ep M exico 14 3 S ingapore France U.K. P hilippines C ze ch R ep. C zec h R e p T urkey U.K. U.K. A ustralia H ong K ong H ungary 8 2 P oland P oland A ustralia 8 2 C anada France M exico P oland A ustralia A ustralia U.K. 9 Note) Medium term means the next 3 years or so Source : JBIC 2007 (10)

11 Efficient Logistics Network Seaport Land Transport Airport Klong Toey :TEU 1.4 mn./yr Laem Chabang: TEU 3.8 mn. 10 mn. Map Ta Phut: 21.4 Mn. Tank farms Donmuang International Airport Suvarnabhumi International Airport Laem Chabang Seaport (11)

12 Hub of Access to Regional Markets (Countries and populations) China: 1.3 billion Early Harvest :China-Thailand China-ASEAN FTA India: 1.1 billion Early Harvest Agreement Japan: 128 million Japan-Thailand Economic Partnership Agreement Taiwan: 23 million Thailand: 65 million GDP per capita: US$ 3,720 ASEAN: 550 million AFTA New Zealand: 4 million Closer Economic Partnership Australia: 20 million TAFTA 12

13 Liberal Investment Policy No restrictions on foreign currency remittances No export requirement No foreign equity restrictions in manufacturing sectors No local content requirement (13)

14 Basic BOI privileges and incentives NON-TAX INCENTIVES Land ownership rights for foreign investors TAX INCENTIVES Corporate income tax holidays up to 8 years Permission to bring in foreign experts and technicians Work permit/visa facilitation Import duty reductions or exemptions on machinery and raw materials (14)

15 BOI Zone Based Incentives Zones Sector Matrix: Incentives to strengthen competitiveness Strategic or Priority Industries Zone-Based Incentives: Lower to higher Zone 1 Zone 2 Zone 3 Maximum incentives regardless of zone or location Example : S&T Businesses Software Mould & Die (15)

16 2. Investment Opportunities Auto Industry Electronics & Electrical Industry Agro-Industry Petrochemical Industry High Value-added Services Alternative Energy (16)

17 Auto & Auto Parts Industries Thailand: Automotive Hub of Asia (17)

18 2007 Automotive Industry in Thailand 1,400,000 1,200,000 Thousand Units Production Domestic Export 928 1,287 1,177 1,000, , , , ,

19 Thailand : Automotive Hub of ASEAN 17 assemblers from Japan, US, and Europe Over 700 first-tier suppliers 1,200 second and third-tier suppliers Motorcycles production ~ 1.6 millions units in 2007 (19)

20 Automotive Industry in Thailand Jan-Jun Thousand Units Growth 20% 599, , ,936 11, , , ,148 Production Growth 9.5% 292, ,281 83,390 10,150 36, , , ,455 40,278 Domestic Sale Growth 25.4% 307, , CBU Export 1-ton Pick up Passenger Car Others (20)

21 Thailand Automotive Industry Trend 1,800,000 Production Sales Exports 1,600,000 1,427 1,400,000 1,200,000 1,125 1,188 1,287 1,000, , , , , ~

22 Electronics & Electrical Products Integrating Innovation & Technology (22)

23 Electronics and Electrical Industry Export US$ 47.2 bn. in 2007, 1/3 of total exports (US$ bn.) Export US$ 28.4 bn. in 2008 (Jan-Jul) Major products: ICs, PCBs, TVs, air conditioners & other white goods World s largest production of HDDs Strong supporting industries for electrical appliances, compressors, motors, plastic and metal parts (23)

24 Major Export Items of Electronics and Electrical Industry Computer Parts & Peripherals Air Condition & Parts ,299 3, (Jan-Jul) 9,099 2, (Jan-Jul) 10,720 2,302 Unit: US$ Million Growth (%) TV, Radio & Parts 3,070 1,731 1, PCB 1, Fax, Tel & Parts (24)

25 Investment Opportunity in E&E HIGH Industrial Value-Added LOW Opportunity in the Missing Links IC Design Upstream Wafer Missing Links IC Thailand imported E&E parts and products US$34 billion in 2007 Midstream Industries Components PCB Telecom PC CE Missing Links Downstream (25)

26 Agro-based Industries Fertile Grounds for Investment (26)

27 Food Export Contribution to Thai Economy Unit: Billion Baht Thai GDP 5,917 7,096 8,386 Total Exports 3,233 4,339 5,255 Food Exports Food exports as % of GDP %Food contribution to total exports Food export has an average growth of 7.7% for the last 5 years.

28 Source: Ministry of Commerce Rubber Rice Sugar Frozen Shrimp Products Canned&processed seafood Tapioca Products Canned & Processed fruit Processed chicken Total Thailand s Top Agriculture Exported products ,710 2,329 2, , ,396 2,583 2,974 1, ,128 1, , ,640 3,470 3,168 1,405 1,267 1,233 1, ,230 Unit: US$ Million % Change (28)

29 Opportunities in Agro-based Industry Net exporter in processed food & commodities value 24,657 Mn.USD. in 2007 World s largest natural rubber producer : 3 million metric tons exported in 2007 Opportunities : Tire, rubber glove & others Tapioca : 6.8 million metric tons exported in 2007 Opportunities: Alcohol, biofuel, food additives Sugar: 4.4 million metric tons exported in 2007 Opportunities: Lactic acid and alcohol (29)

30 Petrochemical Industry (30)

31 Onshore/Offshore/Import Gas Oil Gas Separation Refinery/ Import Thailand Petrochemical Network Ethane 1,134 (1,260 in 2010) Propane /LPG 700 NGL 414 Naphtha 560 Ethylene 2,436 (4,436 in 2010) PE 1,910 PVC 867 PP 1,250 Mixed C PMMA 13 C4 Derivatives Olefin Cracker Pygas Raffinate VCM Propylene 1,281 (2,511 in 2010) Phenol/BPA Cyclohexane/ Caprolactam Unit: Thousand Ton Synthetic Rubber 194 PC 410 NYLON 140 Naphtha Condensate Aromatic Benzene 737 SM 520 PS 450 / EPS 61 ABS/SAN 206 SOLVENTS Toluene 614 Mixed Xylenes 1,773 Remark: Total Capacity as of 2007 P-Xylene 1,430 O-Xylene 80 PTA 2,660 PA 50 Polyester 1,168 PET 545 PLASTICIZER 137 (31)

32 Major Polymer Export in 2007 Products Polyethylene Polypropylene PVC PET Polystyrene/EPS Polycarbonate Polyacetal Export (KT) Export Ratio (Based on production) 50% 30% 48% 61% 50% 93% 89% (32)

33 High Value-Added Services (33)

34 Service Industries Many opportunities exist in this growing sector : Hotel & Tourism Power Plants IT & BPO Services Industrial Estates and Logistics Park Regional Operating Headquarters (ROH) International Procurement Office (IPO) Medium or Low-income Housing Hospital and Retirement Home & Care Center (34)

35 Promotion in Service Sector Public utilities and basic services No. of Projects 169 Value (Mn. Baht) 221,883 Mass transit systems and transportation of bulk goods Hotel & tourism facilities ,550 51,713 Real estate development for industrial use 33 28,343 Medium or low income housing ,831 International Procurement Office (IPO) 186 8,039 (35)

36 Alternative Energy Alternative Energy Powering the Future Powering the Future (36)

37 Alternative Energy in Thailand Solar Biogas Wind Bio Cluster Garbage Water Bio Diesel Ethanol (37)

38 Alternative Energy Industry Promoted activities Biofuels Solar cells NGV equipments and NGV stations VSAT station, Thailand Electricity or steam power using alternative energy sources (e.g. wind, biogas or biomass) Energy-saving machinery/equipment or those utilizing alternative energy Duty free import of energy-saving machinery/equipment for any promoted project (38)

39 3. Recent Investment Promotion Policies : Enhancing Future Growth (39)

40 Value Creation Investment Strategies Strengthening High V.A. Science & Knowledge Based 2 4 Industry / Service Missing Links (Forward & Backward) 1 3 Existing Value Chain Existing New & Cluster (40)

41 New Investment Promotion Policies during Promoting S&T and STI activities Science & technology policy Skills, technology and innovation (STI) policy Biotechnology policy 2. Promoting investment in high potential industries E&E - High value long-term investment Eco-car policy Passenger car policy Motorcycle >500 cc. policy (41)

42 New Investment Promotion Policies during Promoting R&D Investment by SMEs to Enhance Competitiveness 4. Promoting Investment to Reduce Environmental Problem 5. Promoting Energy Saving and Alternative Energy 6. Promoting Integrated Logistics (42)

43 High Value Long-term Investment Promotion Company Investment (Mn. Baht) HDD Production (Mn.Units/yrs) Seagate Technology 37, Western Digital Fujitsu 35,852 15, PCTT 15, Nidec 17, Rohm 15, Statchip Pac 15, Celestica 15, Total 181,663 1,804 (43)

44 New Eco-Car Investment Promotion To promote the manufacture of smaller more fuel efficient cars, meeting international environmental and safety standards : Fuel consumption no more than 5 litres/100 km Emissions standards - Euro4 or higher Carbon dioxide emissions no more than 120 gm/km Safety UNECE Reg Rev.0 or higher (44)

45 Investment Promotion Approval in Eco Car Policy Brand 1. Honda 2. Suzuki 3. Nissan 4. Toyota 5. TATA 6. Mitsubishi Total Investment(Million Bht) 6,700 9,500 5,500 6,600 7,300 7,700 43,300 Production (Units/year) 120, , , , , , ,000 Passenger Car ( B Car) Ford Mazda 20, ,000 (45)

46 Approved Investments in Petrochemical Industry Investment (Mn. USD) DOW CHEMICAL GROUP 2,132 MAP TA PHUT OLEFINS 1,400 PTT CHEMICAL PUBLIC 1,200 SIAM POLYETHYLENE 1,000 (46)

47 Approved Investments in Alternative Energy Ethanol: 34 Projects Biogas: 18 Projects Solar Cells: 3 Projects Wind Power 3 Projects 2,873 Million litres/yr 46.2 Megawatts 101 Megawatts 220 Megawatts (47)

48 Investment Policy to Promote Upstream of High-Quality Steel Industry 1. State of the art in steel technology 2. Continuing investment in R&D 3. Environmental friendly with high standard in pollution control system 4. Good corporate governance, corporate social and community responsibility (48)

49 4 Major Steel Makers 1. Nippon Steel 2. JFE Steel 3. ArcelorMittal Steel 4. Baosteel (49)

50 4. Investment Promotion Strategies: Thailand Investment Year (50)

51 Thailand Investment Year Investment in current competitive industries 2. S&T and future industry development 3. Industrial infrastructure development and investment for future industrial expansion 4. Investment supports to improve competitiveness 5. Promote outward investment to expand business opportunities & competitiveness 6. Proactive marketing to build up investors confidence 7. Improve services and measures to be more conducive to investment 8. Establish competitiveness & investment fund (51)

52 (52)

53 Automotive Industry in Thailand Jan-Jun Thousand Units Growth 20% 599, ,487 Production Growth 9.5% 292, ,283 Domestic Sale 307, (Jan-Jun) Jun) 2008 (Jan-Jun) Jun) Growth 25.4% 385,370 CBU Export (53)