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https://www.nationthailand.com/thailand/economy/40022476

Trade group sees 4% economic growth in Thailand next year

SATURDAY, NOVEMBER 26, 2022

Thailand should show strong economic growth next year, the Thai Chamber of Commerce (TCC) said after the recently completed Apec Summit.

Sanan Angubolkul, chair of TCC and Board of Trade, said on Saturday that Thailand should attract some 600 billion baht in foreign investment, in addition to the more than 10 billion baht already spent in the country when leaders from 21 nations under the Asia-Pacific Economic Cooperation convened from November 14-19.

Sanan said a GDP growth of between 3.5% and 4% can be expected next year, as per estimates from the University of the Thai Chamber of Commerce (UTCC).

For instance, he said more than 200 billion baht will be invested in the high-speed railway link between Thailand, Laos and China, as well as the Saudi Arabian project to build crude oil warehouses in the country.

Sanan was delivering an opening speech at the 40th TCC national meeting in Ubon Ratchathani province.

He also said that Thailand can expect to attract some 20 million tourists next year, double the number recorded so far this year. In addition, he said, another 5 million tourists can be expected if China relaxes its restrictive Covid-19 measures in mid-2023 as expected.
He added that the Thai Chamber of Commerce has also been working closely with the Commerce Ministry to boost Thai exports. He said this year’s export growth can be as high as 8%, double the original target of 4%.

However, Sanan said, more needs to be done to improve Thailand’s competitiveness, which has dropped to 33rd place in the world from 28.

He also advised Thai authorities to be serious about promoting ease of business and investment so more foreigners will want to invest in the country.

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https://www.nationthailand.com/thailand/economy/40022439

Thailand extends free broadband to 75,000 villages, aiming for 30% digital economy

FRIDAY, NOVEMBER 25, 2022

Thailand is providing free broadband internet to all villages in a bid to expand its digital economy from the current 12% of GDP to 30% by 2027.

The expansion plan was unveiled by the National Digital Economy and Society Commission (NDESC) on Thursday as part of its 2018-2037 masterplan.

NDESC secretary general Putchapong Nodthaisong said two phases of the plan are now being implemented with a focus on building public digital infrastructure.

He highlighted the “Village Broadband Internet” (Net Pracharat) project to provide free broadband internet across rural Thailand. A total of 74,987 villages comprising 10.48 million people nationwide have been hooked up to free broadband so far, he said.

The third phase (2023-2027) will focus on transforming internet usage into economic activity to boost digital revenue to 30% of the country’s GDP, he added.

“To do this, we must further improve the digital inclusion rate among Thais by reducing broadband fees to 2% of gross national income per capita, or 385 baht per month on average, with a minimum rate of 220 baht per month for internet speed of 30/10 Mbps.”

The NDESC also aims to increase the online literacy rate to 75% by 2027 to combat risks from cybercrime.

Putchapong said the third phase of the digital masterplan also includes measures to promote 5G adoption by businesses, building and city-planning guidelines to support 5G, ethical standards for artificial intelligence, and the use of low-earth-orbit satellites to expand internet coverage to remote areas.

Current data shows 83.8% of Thais have internet access.

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https://www.nationthailand.com/thailand/economy/40022438

Thailand unveils new incentives for investor relocation, retention and high-tech industries

FRIDAY, NOVEMBER 25, 2022

The Board of Investment (BOI) has unveiled nine measures as part of its five-year (2023-2027) investment-promotion strategy, including support for high-tech industries and tax breaks for companies relocating to Thailand.

The BOI’s latest incentive package is part of the “Thailand 4.0” strategy to shift away from an export-driven economy dependent on low labour costs and natural resources to sustainable, high-tech industries.

The strategy includes new measures as well as the extension of existing measures.

The nine measures are:

1. New industries:

Tax, land, and hiring incentives for businesses related to electric vehicles, new energy, so-called future food, and the space industry.

2. Research and development:

Up to 13 years of tax exemption on R&D costs from 1%, to increase Thailand’s competitiveness. Five years tax exemption for companies setting up education/training institutions for high technology skills.

3. Retention & expansion:

Special incentives for companies that have been granted BOI investment benefits for at least three projects in the past 15 years with a combined value of at least 10 billion baht, and are seeking approval for a new project or project expansion worth 500 million baht-plus. The incentives include exemption from corporate income tax (CIT) for up to three years or 50% CIT reduction for up to five years depending on the type of activity.

4. Relocation programme:

CIT exemption for five years for companies that relocate factories, regional headquarters and R&D centres to Thailand. Those that relocate just their regional headquarters and factories will receive a three-year CIT exemption.

Companies that relocate just their R&D centres and factories will receive a CIT exemption between one and five years, depending on the industry.

5. Investment for economic recovery:

Large projects investing 1 billion baht or more over 12 months to receive 50% CIT reduction for five years.

6. Smart & sustainable industry:

New 4.0 industrial projects including automation to receive CIT reduction of 50-100% depending on business type.

7. SME promotion:

CIT exemption for 3-8 years depending on business type. To qualify, firms must invest at least 500,000 baht (down from 1 million baht), have debt-to-capital ratio not exceeding 4:1, and invest in machinery worth at least 10 million baht, 50% of which must be new.

8. New special investment zones:

Numerous incentives for investment in four regional economic corridors (16 provinces), border special economic zones (10 provinces), southern border zones (four provinces), low-income per capita provinces (20), promoted industrial estates, and science and technology zones.

9. Community and social development:

Three-year CIT exemption on up to 200% of investment for non-BOI projects or an additional 200% exemption for existing BOI projects.

Related stories

• BOI roadshow in Japan aims to draw investors to EEC
• 480 foreign firms bring over THB100bn to Thailand this year
• BOI frames new 5-year investment promotion strategy to pave way for new economy

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https://www.nationthailand.com/thailand/economy/40022435

Baht opens unchanged on Friday at 35.75/dollar

FRIDAY, NOVEMBER 25, 2022

The baht opened at 35.75 to the US dollar on Friday, unchanged from close of trade on Thursday.

The currency will likely move between 35.65 and 35.85 against the greenback during the day, Krungthai market strategist Poon Panichpibool said.

Poon said that the dollar’s risk-on state is supporting strengthening of the baht. The Thai currency would also face upward pressure if the gold price continues to rise prompting a sell-off, he added.

However, baht strengthening might slow as foreign investors sell Thai assets, especially short-term bonds.

Meanwhile, importers are waiting to buy dollars at the end of this month. Poon estimated the baht’s support level at between 35.50 and 35.70 to the dollar.

He also advised investors to use hedging tools such as options to manage risks in a highly volatile currency market.

Related stories

• Baht may strengthen slightly with market in risk-on state: strategist
• Baht slide slows on Tuesday opening after Monday dive
• Baht weakens on Monday, signalling rally may be over

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https://www.nationthailand.com/thailand/economy/40022409

Vehicle exports, domestic sales accelerating

THURSDAY, NOVEMBER 24, 2022

The Federation of Thai Industries (FTI) is highly satisfied with the growth in October’s car exports after the auto industry received more semiconductors following a global shortage.

October saw exports of 94,228 vehicles, a growth of 15.51% year-on-year (YoY).

“Vehicle exports grew greatly because manufacturers received more semiconductors,” FTI vice chairman Surapong Paisitpatanapong said. “The export value increased because PPVs have a higher value than passenger cars or pickup trucks.”

Precisely 800,672 vehicles were exported in the first ten months of 2022, a 5.48% increase YoY, with the export value being 497.28 billion baht, rising 12.40% YoY.

Meanwhile, the number of vehicles manufactured in October was 170,717, a 10.83% increase YoY.

The first ten months of 2022 saw 1,534,754 vehicles manufactured, rising by 12.36% YoY.

“The number of vehicles manufactured this year might reach the original goal of 1.8 million if manufactures continue to receive semiconductors, so the situation must be closely monitored,” Surapong said.

As for domestic sales, 64,618 vehicles were sold in October – a modest 0.24% increase YoY as the economy recovers thanks mainly to tourism and the policy making it easier for foreign investors to enter.

Furthermore, several government stimulus packages have helped to increase domestic vehicle sales to 696,305, a 17.09% increase YoY.
In October, 1,960 battery electric vehicles (BEV) were registered – rising as much as 288.89% YoY; 5,036 hybrid electric vehicles (HEV) were sold – a 121.65% increase; and 899 plug-in hybrid electric vehicles (PHEV) were registered – rising by 84.98%.

As of October 30, or the first 10 months of the year, a total 11,025 BEVs were sold – rising by a huge 198.54% YoY; 241,764 HEVs were registered – an increase of 32.06%; and 40,790 PHEVs were sold – a 35.38% rise.

“Electric vehicle sales are growing strongly this year – around 1,000 per month – with HEVs being the biggest sellers during this period of technological transition. When EV infrastructure is fully ready, [I] expect the proportion of BEV sales to be around 70% of total EVs,” Surapong added.

Related stories

• Govt revenue for fiscal year is THB151 bn higher than projected
• Domestic tourism flying high, expected to surpass pre-Covid level
• 148 foreign firms under scrutiny as Thailand cracks down on illegal businesses

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https://www.nationthailand.com/thailand/economy/40022397

Baht may strengthen slightly with market in risk-on state: strategist

THURSDAY, NOVEMBER 24, 2022

The baht opened at 36.00 to the US dollar on Thursday, strengthening from Wednesday’s close of 36.27.

The currency will likely move between 35.85 and 36.15 against the greenback during the day, Krungthai market strategist Poon Panichpibool predicted.

He said the baht has support to strengthen as the market is in a risk-on state. Meanwhile, the rising gold price has led investors to sell the precious metal for profit.

Poon, however, expected the baht not to strengthen further than its support level of 35.80 to 35.90 to the dollar because importers are likely to purchase more of the greenback at the end of the month, especially once the baht strengthens.

Furthermore, foreign investors are selling their Thai assets for profit, which will also slow the strengthening of the baht.

Poon suggested a close watch on the country’s trade report. If exports were seen to grow greater than expected and the trade deficit was lower than market expectations, the baht could strengthen further.

However, he felt the global economy is slowing, so it is hard for Thai exports to grow greatly. This means investors should beware of the risk that the baht could weaken especially if exports and the trade deficit are worse than expected.

Poon advised investors to use hedging tools such as options to manage risks in a highly volatile currency market.

Related stories

• Baht slide slows on Tuesday opening after Monday dive
• Baht weakens on Monday, signalling rally may be over
• Baht opens higher on Friday but downward pressure mounting

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https://www.nationthailand.com/thailand/economy/40022394

S&P retains Thailand’s sovereign credit BBB+ rating

THURSDAY, NOVEMBER 24, 2022

S&P Global Ratings (S&P) has retained Thailand’s sovereign credit rating for 2022 at BBB+, with a stable outlook, similar to last year, according to Public Debt Management Office director-general Patricia Mongkhonvanit.

S&P’s ratings report, published on Wednesday, said the Thai economy is accelerating after an extended slowdown stemming from Covid-19. The lifting of restrictions on domestic movement and border controls is helping to normalise economic activity.

Crucially, this easing of restrictions is speeding up recovery of Thailand’s tourism sector, which plays a key role in its services-oriented economy, said S&P.

The ratings agency expected Thailand’s real GDP growth to quicken to 2.9% in 2022, versus 1.5% in 2021, and forecast an average real GDP growth rate of 3.2% from 2022 to 2025.

The tourism sector could outperform higher-end expectations for approximately 10 million international visitors this year, increasing from 428,000 visitors in 2021, the report said.

S&P said the government is maintaining an emphasis on capital expenditure projects, including work on the Eastern Economic Corridor, as well as transport infrastructure under a master plan.

Ongoing investment in these areas will restore the competitiveness of Thailand’s economy, which has been characterised by relatively weak productivity growth in recent years, the report added.

Regarding finance, S&P projected the country’s fiscal deficit and accumulation of debt to fall gradually over the next three years, as pandemic-related stimulus fades and revenue performance improves.

The budget is likely to improve in fiscal 2023, after the economy begins to recover. Revenue growth will be stronger, and the need for stimulus spending will abate.

S&P said Thailand’s current account, which fell into deficit during the first quarter of 2021 and has remained there since, will benefit materially from the lifting of pandemic-era border restrictions.

Meanwhile, tourism revival will help to moderate the country’s services exports deficit, and is likely to result in a modest current account surplus from 2023.

The agency expected the current account to average a surplus of 2.1% of GDP from 2023 to 2025.

“S&P remarked that factors that require close monitoring are the global financial situation and political stability in Thailand, which could affect the performance of socio-economic policies,” Patricia pointed out.

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Moody’s affirms Thailand’s Baa1 rating, maintains stable outlook

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https://www.nationthailand.com/thailand/economy/40022379

BOI roadshow in Japan aims to draw investors to EEC

WEDNESDAY, NOVEMBER 23, 2022

The Board of Investment (BOI) will hold a roadshow in Japan next week to promote investments in the Eastern Economic Corridor (EEC), the board said on Wednesday.

BOI secretary-general Narit Therdsteerasukdi said the roadshow would be held from Monday to Wednesday with cooperation from the Eastern Economic Corridor Office and the Industrial Estate Authority of Thailand.

During the roadshow, representatives of the three agencies will meet and discuss with representatives of key state and private agencies in Japan, including the Ministry of Economy, Trade and Industry (METI), the Japan External Trade Organisation (Jetro), and the Organisation for Small & Medium Enterprises and Regional Innovation, Narit said.

He said the Thai delegation would also meet representatives of the Japan Business Federation (Keidanren), the Kansai Economic Federation and the Osaka Chamber of Commerce and Industry.

During the meeting and consultation, the Thai delegation would promote investments of targeted industries in Thailand, Narit added.

He said the BOI would also hold two seminars in Tokyo and Osaka under the title “Thailand Investment Promotion Policy: New Economy, New Opportunities”.

During the seminars, the BOI would present the new investment promotion measures, the latest development of the EEC and the readiness of industrial estates in Thailand for Japanese investors.

“This trip will be a cooperative venture of agencies in charge of promoting investments in the country,” Narit said.

“We selected Japan as the first country for the roadshow because Japanese investors are the largest groups of foreign investors in the kingdom.

“We aim to invite them to invest in targeted industries, such as electric vehicles, electronics, biological technology, and clean energy. Japan has the expertise for these industries.”

He added that the roadshow would also encourage Japanese investors to set up research and development bases and regional offices in Thailand.

BOI statistics from 2017 to 2022 show that Japanese investors filed applications for investment privileges for 1,371 projects worth 474.79 billion baht. Most of the projects are in auto and auto parts, manufacturing of electric and electronic appliances, and chemical products.

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https://www.nationthailand.com/thailand/economy/40022370

Govt revenue for fiscal year is THB151 bn higher than projected

WEDNESDAY, NOVEMBER 23, 2022

The real revenue collected by government agencies during Fiscal Year 2022 amounted to 151 billion baht more than projected, a government spokeswoman said on Wednesday.

Ratchada Thanadirek said the revenue for the fiscal year, which ended on September 30, was projected at 2.4 trillion baht but government agencies collected and handed over a total of 2.55 trillion baht to the Finance Ministry.

Ratchada said government agencies managed to collect higher than projected revenue because of increased tax collection from the sale of goods and services, while state enterprises also generated more income.

She said the agencies projected they would borrow about 700 billion during the fiscal year but the actual amount stood at 652.5 billion.

For the fiscal year, the government projected total spending of 3.1 trillion, but actual spending stood at 2.9 trillion, or 8.71 billion baht lower. The actual spending amount excluded 190.5 billion set aside for late reimbursements by government agencies.

Ratchada said the impact from the Covid-19 pandemic prompted government agencies to spend their budgets within the time frames of their projects.

As for the current account, government revenue during the fiscal year was 3.2 trillion baht, while spending was 3.14 trillion, with a surplus of 55.7 billion baht.

The spokeswoman said the government enjoyed a surplus current account because agencies received higher revenue than projected, including personal income tax and value-added tax as well as import and export taxes.

During the weekly Cabinet meeting on Tuesday, Ratchada said, the Cabinet approved six frameworks for the Budget Bureau to prepare for the 2024 fiscal year budget.

Fiscal Year 2024 will see money mainly going for:

– Security

– Strengthening competitiveness

– Human resources development

– Promoting social equality

– Boosting an environmentally friendly quality of life

– Bureaucratic development.

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https://www.nationthailand.com/thailand/economy/40022363

Domestic tourism flying high, expected to surpass pre-Covid level

WEDNESDAY, NOVEMBER 23, 2022

The Tourism Authority of Thailand (TAT) expects Thai tourists to travel across provinces more than before the Covid crisis in 2019.

TAT deputy governor for Domestic Marketing Thapanee Kiatphaibool said on Wednesday that Thai tourists took 200 million trips across provinces by the end of October this year compared to 222 million for the year before the Covid-19 pandemic in 2019.

“The number of trips across provinces was higher than the target of 160 million,” she said.

Thapanee also expects Thai tourists to generate 800 billion baht, higher than the targeted 656 billion baht, on rising domestic family travel and conferences.

She said domestic airlines have increased flights to many areas, especially Chiang Mai, Phuket and Songkhla’s Hat Yai district, as well as flights from overseas to Thailand.

“The passenger load factor has increased 75-80%,” Thapanee said.

Up to 150,000 flight tickets of a total 500,000 under the “Flying Across Thailand” project by TAT and domestic airlines have already been snapped up, she said.

“Another 150,000 tickets would be sold during the remainder of the year,” she added.

Related stories:

• District in Loei woos tourists with colourful ‘Christmas Festival’
• Boom times at Pattaya International Fireworks Fest this weekend
• Thailand can expect swarm of tourists after Apec global spotlight: Prayut