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BOI seeks revision of investment promotion terms

By on Oct 25, 2012 in Property News

The Board of Investment hopes to see its proposed three-pronged strategy for amending investment promotion implemented as quickly as possible, newly appointed secretary-general Udom Wongwiwatchai said yesterday.

The BoI plan calls for a restructuring of the direction of investment promotion, doing away with privileges granted based on location, and a reduction of the list of businesses to be promoted.

The agency urgently needs to revise its current approach and focus on new investment promotion conditions to serve the country’s economic development plan, the requirements of business and the changing global economy, he said.

As well, the agency’s overseas offices have to work more aggressively to attract potential businesses to invest in Thailand, investment regulations should be amended to facilitate businesses wishing to operate or expand here, and there needs to be a new focus on targeted sectors and types of business rather than on investment value, he added.

The BoI’s proposed new strategy awaits consideration by the agency’s board, which is chaired by Deputy Prime Minister and Finance Minister Kittiratt Na Ranong. However, it hopes the various strands can be implemented next year.

The agency currently grants investment privileges to 243 businesses, but plans to reduce the number to less than 100. It plans to end incentives for businesses able to manage their investment without state aid, as well those with labour-intensive operations.

The new focus will be on promoting high-creativity business, green business, alternative business, high value-added business, tourism and health, and logistics services, said Udom.

Investors whose business creates high value-added income and those using more advanced technology will enjoy more privileges, he said.

At present, investment privileges are granted to businesses dependent on the location in which they set up. The areas are divided into three zones, with Zone III receiving the highest benefits.

“We consider that using current principle to grant privileges has not drawn much investment, so we have to focus more on the added value of the product and the implementation of more advanced manufacturing technology,” the agency chief said, adding that businesses which spend much more on research and development will also be made priority candidates for investment privileges.

Privileges granted to auto-makers, software and electronic businesses will be maintained, as they use advanced technology in the manufacturing process. Moreover, auto-makers will use even more advanced technology in producing electric cars, which should therefore also be deemed eligible under investment promotion, he said.

Labour-intensive manufacturing such as garments should focus more on setting up in neighbouring countries rather than solely producing in Thailand, he said. This type of business will enjoy generalised system of preferences incentives granted by developed countries.

The BoI also aims to persuade more companies to explore opportunities abroad, particularly in Myanmar, Vietnam and Indonesia, where there is great potential for Thai investment, Udom said.

The agency will also work with the Education Ministry to help train more skilled workers to meet market needs and solve labour shortages.

Source : The Nation 25 October 2012

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