The Thailand Board of Investment has just approved the Five-Year Investment Promotion Strategy (B.O.I.), covering the period from 2023 to 2027, focusing primarily on attracting investments in innovative, high-technology, and green industries, key to Thailand’s long-term development and competitiveness. A strategy aiming to lead Thailand into a new economic era through automation, artificial intelligence, and “smart technology,” in line with the basic principles of the fourth industrial revolution, more commonly known, according to the term coined by Klaus Schwab, as “Industry 4.0.” To this end, it intends to rely on three general concepts and seven unique pillars.
The first do not refer to specific issues or sectors but rather to basic principles on how Thailand should promote and structure every aspect of the new economy, trying, in doing so, to strengthen Thailand’s current status as a regional platform for business, trade, and logistics, in open competition with other Southeast Asian countries pursuing identical or similar goals. This approach is essential for boosting investments in Thailand, drawing more interest to the country. These concepts, inspiring the pillars I will discuss in detail below, are innovation, technology, and creativity; competitiveness and the ability to quickly adapt to any environment; and inclusivity, particularly in the areas of the environment and social sustainability, crucial for social development and well-being and fundamental pillars to attract more investments in Thailand.
The second aim to reflect the BOI’s position on Thailand’s investment promotion policy, especially regarding specific areas of industrial development and political reforms identified by the Strategy, with the objective of turning this vision into reality. These pillars include improving existing industries; accelerating the industrial transition towards green and smart industries; promoting Thailand as a business hub and gateway for international trade and investment in the region; strengthening small and medium-sized enterprises and startups; boosting investments in different regions of Thailand; promoting investments that provide community and social development; and generating Thai investments abroad. All these pillars are key to fostering investments in Thailand.
Both the concepts and pillars mentioned are general statements that need further specification to know exactly how they will affect various economic sectors, what role the BOI will play in this context, and how they will improve existing regulatory frameworks, particularly for foreign investors and how this will influence future investments in Thailand. As for the sectors, it seems that those most benefited will be electric vehicle construction, green biocircular industries, and automated manufacturing systems, along with research and development (R&D), in an attempt to make the economy increasingly knowledge-based.
The BOI’s role is set to be strengthened by unfolding into “promoter” (facilitator of fiscal and non-fiscal benefits); “integrator” (of investment support tools); “facilitator” (of services); and “connector” (of industries or sectors to create more business opportunities). All this suggests that the BOI, having the necessary resources and means, will place an increasing emphasis on supporting investments in Thailand, both domestic and foreign; improving regulatory frameworks; and achieving greater ease of doing business, a highly sensitive issue for foreign investors, despite Thailand’s improvement in the World Bank’s “Ease of Doing Business” ranking from 27th to 21st out of 190 countries.
Antonio Viñal
Lawyer
AVCO Legal
madrid@avco.legal
