Thailand’s new investment strategy will shift from broad-based to focused and prioritized investment promotion that will lead to the restructuring of the Thai economy.

It will also move Thailand forward to become a higher-income economy, with sustainable growth in the long run.

The seven-year draft investment promotion strategy, 2015 to 2021, was approved in principle by the Board of Investment (BOI) during its meeting on 19 August 2014. This meeting was the third after the National Council for Peace and Order appointed new BOI members on 8 June 2014.

The new strategy will still offer promotional privileges to seven groups of industries, but greater emphasis will be placed on high technology, high added value, research and development or design, and environmentally friendly activities.

The seven industries involve agro-industry and agricultural products; mining, ceramics, and basic metals; light industry; metal products, machinery, and transport equipment; electronics industry and electrical appliances; chemicals, paper, and plastic; and services and public utilities.

There are two types of incentives to be offered, namely activity-based incentives and merit-based incentives. For instance, basic incentives will be offered in accordance with the types of activities. Additional incentives will also be provided for projects that will benefit the country, such as research and development, high-skill development, and the distribution of wealth to regional areas.

The previous zoning policy, whereby Thailand was divided into three zones for investment purposes, will be revoked. It will be replaced by the promotion of new regional clusters in order to create new investment concentration in each region and stronger value chains.

Moreover, the new strategy will attach importance to both inbound and outbound investment promotion. This will help ease constraints in terms of domestic resources. It will also enable the country to seek new business opportunities for the Thai private sector, especially when the ASEAN Economic Community (AEC) goes into full effect and Thailand plays a greater role in the international arena.

In this regard, the first target countries include Indonesia, Myanmar, Vietnam, Cambodia, and Laos. The second ones are China, India, and other ASEAN nations, while the third group includes Central Asia, South Asia, and Africa.

The BOI meeting also approved measures to enhance the competitiveness of small and medium-sized enterprises (SMEs) and to increase production efficiency. The measures involve the replacement of machinery for energy saving, alternative energy use, and the reduction of environmental impacts. They also call for more investment in research and development and engineering design in order to improve productivity.