Doing Business In Thailand

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Why Thailand?

Market Strengths

Key strengths of the Thai market for UK companies include:

  • Hub of South-East Asia, gateway to Indochina and
    Southern China.

  • Improved and modernised transportation facilities.

  • Well-developed infrastructure and upgraded IT
    and communication systems.

  • State-of-the-art industrial estates.

  • Thailand ranked nineteenth out of 183 nations by
    the World Bank's Ease of Doing Business survey in

  • Good transport hub.

  • Low-cost skilled workers and labour.

  • Government efforts to make Thailand a foreign-
    investor-friendly market, for example by tackling
    bribery and corruption, and simplifying import

  • Wealth of experienced international legal advisers
    and business consultants.

Thailand offers exciting business opportunities to companies prepared to take a serious interest in this dynamic market.Over a number of years, Thailand, which has a population of 67 million, has managed to transform its economy from one that was primarily agriculture-based, to one of the most diverse in the region. As well as agriculture, major industries include food processing, cement, integrated circuits, automotive parts and assembly, petroleum products, textiles, footwear, toys, furniture, synthetic fibre and tourism. The country has a well-developed infrastructure, a free-enterprise economy and generally pro-investment policies.

Strategically located at the heart of Asia - one of the world's largest growing economic regions - Thailand is also well placed to offer a gateway to both the ASEAN (Association of Southeast Asian Nations) and Asia-Pacific markets, particularly India and China, many of which offer great business potential.

The ASEAN region alone has a cumulative population of more than 500 million and GDP in excess of US$700 billion.

Within ASEAN, Thailand's economy is in the top three in terms of size and volume of international trade. It is therefore well positioned as the region moves towards economic integration and a single free-trade area in 2015. Zero tariffs between the top five members (including Thailand) were implemented in January 2010.

Economic leader

Thailand is one of the largest growth markets in Asia, having recovered well from a recent slump in the global economy.

Growth of 7.85 per cent is estimated for 2010 and 3-5 per cent for 2011. The Thai currency, the baht, is reflecting this performance and is now at its strongest level since the 1997 Asian financial crisis and among the fastest-appreciating currencies in the region.

Stimulus packages will continue into the medium term, focusing on long-term competitiveness building rather than short-term injections.

Thailand has been designated a high‑growth market under UK Trade & Investment's five‑year strategy.The Government is expected to spend 1.43 trillion baht (approx £27 billion) between 2010 and 2012, benefiting sectors such as transport, public health, water supply development, education and training, and housing.

Open for business

Priority Sectors

The following sectors offer significant commercial 
opportunities for UK companies and reflect 
Thailand's priorities and UK capability:

Advanced engineering
Education and training
Food and drink

Opportunities also exist in:

Automotive and automotive parts
Healthcare, medical devices and 
pharmaceuticals (Thailand is aiming to be Asia's 
medical hub)
Renewable energy
Sports and leisure equipment

The Thai Government welcomes foreign investment. The country maintains an open, market-oriented economy and views foreign investment as a means of promoting economic development, employment and technology transfer.

Over the last few decades Thailand has been a major destination for foreign investment and this looks set to continue. A recent survey conducted by the Japan External Trade Organization (JETRO) stated that Thailand was the "most optimal location for establishing a production/sales base in the coming five to ten years."Through Thailand's Board of Investment (BOI), the Thai Government offers a range of tax incentives, support services and import duty concessions to companies from various sectors seeking to invest in the market.

Political situation

Thailand is a constitutional monarchy with a parliamentary government. The King, a highly revered figure in Thailand, is the Head of State, while the Prime Minister is the Head of Government.

Thailand has had a number of military coups, most recently in September 2006. Civilian rule returned in February 2008. Despite frequent changes in government, Thailand's economy continues to grow and has weathered the global economic crisis and the political demonstrations in early 2010.

The recent political unrest has tested the operating environment for businesses in Thailand. Most companies are confident their operations can continue uninterrupted with adequate preparations in place, such as business continuity plans and backup sites. Political demonstrations, on occasion, have disrupted infrastructure, such as the closure of Bangkok's international airport in 2008 and its Skytrain system in early 2010.

Commercial opportunities

The UK enjoys a healthy trading relationship with Thailand. From 2005 to 2009 two-way trade in goods and services averaged £3.6 billion a year. In 2009 UK goods and services exports to Thailand increased by 14 per cent and 39 per

Thailand takes a welcoming approach to UK companies. British goods enjoy an excellent reputation there, although they must generally be cost-effective and have good after-sales support.cent respectively compared to the previous year. Although the balance of trade remains in Thailand's favour (1:2.5), the UK is Thailand's most significant European investor and the second-largest European exporter (after Germany).

There are a wide range of business opportunities for UK companies in Thailand. In particular, the country's economic growth has created openings for UK firms in a number of infrastructure sectors, including electrical power, telecommunications and renewable energy.

Thai consumers are also creating opportunities for new sales of UK medical products, cosmetics, security equipment, food supplements and educational services.

Moreover, UK companies are increasingly looking to Thailand not only as a thriving market in its own right, but also as a regional base for doing business more widely in Asia.

The British Chamber of Commerce Thailand (BCCT) is the oldest foreign chamber and the largest non-Asian foreign chamber in Thailand. It is also the largest and oldest British Chamber in Asia with a membership of over 650 companies including Barclays Capital, BG Group, BT, Diageo, GlaxoSmithKline, HSBC, Prudential, Rolls-Royce, Shell, Standard Chartered Bank and Unilever. The UK retail sector is also well represented by a growing number of companies including Tesco, Boots, M&S, The Body Shop, Next, Mothercare, Burberry, Paul Smith, Thomas Pink, Savile Row Company, Ted Baker, Topshop and Fitflop.

Top Ten UK Exports of Goods to Thailand in 2010 (£Millions)

Item 2010 2009 % Change
Road Vehicles 238 80 198
Office Machines 89 83 7
Metal and Scrap Metal 60 36 67
Specialised Machinery 57 40 43
Medicines and Pharmaceutical Products 54 48 13
Power Generating Machinery and Equipment 48 47 2
General Industrial Machinery 44 42 5
Beverages 43 31 39
Electronic Machinery and Appliences 41 52 -21
Miscellaneous Manufactured Articles 35 25 40
Total 709 484 47

Source: Department for business, Innovation and Skills analysis of Office for National Statistics data

Source - UKTI


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