CONTENTS

January 2014 Volume 24 No. 01

Thailand’s economy continues to grow in the face of domestic and international challenges. The National Economic and Social Development Board has indicated that the country could grow by 4 to 5 percent in 2014, and the United Nations Economic and Social Commission for Asia and the Pacifi c estimates growth for the year at 4.5 percent.

It has been reported that the Finance Ministry too foresees a similar pattern of growth, and that infrastructure projects could add as much as 0.5 percent on top of the projections.

While exports were sluggish in 2013, the Thai National Shippers’ Council has forecast that they will grow by 5% in 2014 due to the recovery in the global economy.

Thai National Shippers’ Council President Nopporn Thepsitta was reported in the media to say that the export industry saw 0.5 % negative growth in 2013, but that this should turnaround as the global economy is recovering. The Council foresees a 5% growth in exports.

In this connection, Bloomberg Businessweek and others have reported in early January that the International Monetary Fund will be raising its forecast for annual world growth by the end of the month.

According to Aberdeen Asset Management, Thai exports will benefit from the economic recovery in the US, the European Union, China and Japan; forecasting exports to grow by at least 7 per cent in 2014.

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Growth Amid Challenges 1

News Bites / BOI Net Applications 2Industry Focus: Thailand’s Film Industry 4

BOI’s Overseas Investment Center 6North South Corridor Strengthened 7Top 10 Locations to Retire 8Annual Meeting of BOI Overseas Offi ces 9

Going Green: The Future is Now 10Thai Tax Comparatively Low 11Thailand Economy-At-A-Glance 12

Continued on P. 3

Growth Amid ChallengesSource: Bank of Thailand

Thailand’s GNP per Capita, 1990-2011

NEWS BITES BOI NET APPLICATIONSAEC to Boost Thai Aviation

The Thai aviation industry is preparing to meet growing demand at home and abroad when the AEC comes into existence in 2015.

Thailand is striving to become an aviation hub in this region. At the same time, it also aims to be a regional aircraft service and maintenance center. It is expected that the number of flights passing through both Suvarnabhumi and Don Mueang airports will grow by about 10 percent in 2014 and 11 percent in 2015.

Thailand’s aircraft maintenance business has grown steadily. It was valued at 19.1 billion baht in 2012, accounting for an increase of 20 percent over 2011. This business is expected to grow further as the launch of the AEC approaches. In particular, “CLMV” countries, comprising Cambodia, Laos, Myanmar, and Vietnam, will become an important market for Thailand’s aircraft maintenance business. Thailand also provides other functions, including air transport services, ground-based infrastructure, supply chain activities, and other related business areas.

Standard & Poor’s (S&P) Maintains

Leading credit rating agency Standard & Poor’s (S&P) is maintaining Thailand’s credit standing at stable while deeming political uncertainty as a negative factor that needs close monitoring.

Based on a report by the Public Debt Management Office, S&P has given Thailand ratings of BBB+ and A-2 for its long-term and short-term foreign currency bonds respectively while local currency ratings are at A- for long-term bonds and A-2 for short-term. The country’s credit outlook is also kept at stable, and the long- and short-term ASEAN regional scale ratings are standing at axAA and axA-1 respectively.

S&P indicated that Thailand’s public debt was still relatively low despite the debt burdens incurred by the government’s various stimulus programs. The public debt is projected to account for 26% of the GDP in the next three years.

Plan to Map Out New Tourism Routes

The Chiang Mai Tourism Business Association has unveiled a plan to map out new tourism routes which will connect Northern Thailand with Laos, China and Myanmar and help boost the local trade and tourism.

The routes will link eight northern provinces of Thailand with Northern Laos, Southern China and Myanmar. Local trade, tourism and investment are expected to prosper as a result.

During this New Year holiday, Chiang Mai province has seen notable increases in the numbers of Thai and Chinese visitors, with the tourism revenue for the period expected to grow 10%.

As for the national goal to achieve an annual tourism income of 2.2 trillion baht in the year 2015, the association is confident that Chiang Mai and other provinces in the North will be able to contribute up to 80 billion baht of the amount.

2012(US$ = 31.68 THB)

2012 (Jan – Nov)(US$ = 30.70 THB)

2013 (Jan – Nov)(US$ = 31.63THB)

Number of projects Value Number of

projects Value Number of projects Value

Total Investment 2,584 47,586 1,877 28,146 1,696 25,007

Total Foreign Investment 1,584 20,849 1,289 16,145 1,015 12,225

By Sector

Agricultural Products 85 1,042 71 838 59 740

Minerals / Ceramics 34 514 28 450 29 1,191

Light Industries / Textiles 80 1,097 62 822 53 315

Automotive / Metal Processing 532 7,541 437 6,434 349 5,970

Electrical / Electronics 289 5,021 245 3,578 184 1,132

Chemicals / Paper 228 2,707 178 2,045 111 680

Services 336 2,926 268 1,980 230 2,197

By Economy

Japan 872 12,033 714 10,169 528 7,098

Europe 166 1,724 137 1,219 113 827

Taiwan 53 285 47 268 43 197

USA 53 795 42 537 52 301

Hong Kong 72 1,695 57 898 35 613

Singapore 134 871 115 754 72 425

By Zone

Zone 1 417 2,660 352 2,068 327 1,475

Zone 2 922 15,101 740 12,054 529 7,353

Zone 3 245 3,088 197 2,023 159 3,396

Unit: US$ MillionNote: Investment projects with foreign equity participation from more than one country are reported in the figures for both countries.

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Thailand’s economic growth in 2014 is forecast higher than the previous year, and with infrastructure spending still in the works, albeit delayed, the economic benefits will nevertheless be realized. Inflation in the country remains low, and the government sees it within the range of 2.1-3.1 percent in 2014.

Likewise, the new policies that were to be announced by the Thailand Board of Investment will enable the incoming government to have an opportunity to sign on and thereby ensure investors of policy continuity.

The strong confidence that investors have in Thailand is reflected in many different ways, noticeably in the approximately 1.1 trillion baht in application value that was received by BOI in 2013. Also, there is the fact that while the political challenges remain Thailand nevertheless managed to move up the ranks to become the world’s 9th largest auto manufacturing country this year.

Thailand has also maintained its 18th place ranking by the World Bank’s 2014 Ease of Doing Business, and there is the fact that ratings agencies such as Standard & Poor’s continue to maintain their position on Thailand. It should also be noted that the country has improved its World Economic Forum Competitiveness ranking (37th) for the second year in a row. There are many areas where the Thailand continues to show an improving trend and this has been recognized by investors who look to the next five years and to the future of Thailand in the ASEAN Economic Community.

Regardless of the political situation, Thailand’s investment policies are always open and welcoming making the country the place to invest in Asia, today and tomorrow.

The BOI remains committed to introducing its new investment promotion policy at the beginning of January 2015. The new policy awaits the approval of the Board of Investment to be appointed. BOI remains committed to ensuring that investors have conducive investment environment.

Despite all of the noise created by the domestic political situation, there is a general confidence in Thailand’s long-term economic growth and investment environment. A look at past transitory political events, reveals that they have had little effect on longer term economic development and growth. Thailand’s per capita gross national product has seen a steady rise for over twenty years and the country is still poised to transition itself into becoming a creative knowledge-based economy, following the development path of other East Asia economies.

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Thailand’s Film IndustryThe cinema of Thailand dates back to the early days of filmmaking, when King Chulalongkorn’s visit to Bern, Switzerland in 1897 was recorded by Francois-Henri Lavancy-Clarke. Subsequently, the film was brought to Bangkok, where it was exhibited publicly. This sparked more interest in film by the Royal Family and local businessmen, who brought in filmmaking equipment and started to put on display foreign films. By the 1920s, a local film industry was started and in the 1930s, the Thai film industry had its first “golden age”, with a number of studios producing movies.

The years after the Second World War saw a resurgence of the industry, which used 16 mm film to produce hundreds of movies, many of them hard-driving action flicks, particularly during the 1960s and 1970s. However, competition from Hollywood brought the Thai industry to a low point in the 1980s and mid-1990s, but by the late 1990s, Thailand had its “new wave”, with such directors as Nonzee Nimibutr, Pen-Ek Ratanaruang and Apichatpong Weerasethakul, as well as action hero Tony Jaa being celebrated at film festivals around the world.

Still, Thailand has a well-established film industry with state-of-the-art animation studios and production facilities. The country’s film and TV industry directly contributes US$2.22 billion to the local economy, supports 86,600 jobs and generates US$81 million in tax revenue, according to Oxford Economics. Furthermore, homegrown movies, such as the 2004 horror film Shutter, have

INDUSTRY FOCUS

been adapted by a number of film studios across the world. Along with newly emerging Thai film companies like Fame Post Production Co., Ltd. and Kantana Group, world renowned firms such as Technicolor already have set up operations in Thailand to take advantage of the country’s film and entertainment industrial boom.

With the ambition of becoming a leading film location destination in the region, the Thai government on 19 July 2007 took a great leap forward in that regard by launching the ‘One Stop Service Center for Filming’. Initially, the office catered to certain types of productions, (TV commercials, documentaries, music videos, TV programs) but this range has expanded as the Center was seen as an incentive by foreign filmmakers to take advantage of the many services the Kingdom has to offer. Concerning other types of productions, for example feature films, docudramas, TV dramas and miniseries, applications made at the Thailand Film Office will take at least 14 days to process, as the script must be approved first.

In 2008 the archaic 1930 Film Act was replaced by the Film and Video Act. A committee with representatives from several government ministries and outside organizations was set up with the Prime Minister as chair of the committee. Now various branches of the government are talking to each other about one topic, film making in Thailand (the domestic industry and

attracting movie studios from abroad) and how to grow various aspects of the business and thus increase revenues for the Kingdom.

So moving in tandem, the Board of Investment, Ministry of Culture, Ministry of Tourism and Sports, and the Tourism Authority of Thailand began to promote the film industry to the point that the government set up the National Creative Economy Policy Committee in 2009. The purpose of this working group was to develop Thailand into a creative economy hub for the ASEAN region and increase the country’s proportion of creative economy value from 12% to 20% of GDP by the year 2012.

With a government commission to provide direction, Thailand hosted 53 international film productions in 2012, a 45% increase over 2011 and an absolute record for the country. This remarkable growth is not

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only due to the country’s breathtaking scenery, but also due to the world class quality of its hospitality services and its competitive production costs. In recent years, the local film industry has gone through a rapid period of modernization and internationalization, and now offers among the most skilled film crews and technical services available in Asia.

In 2013, some 717 foreign productions were filmed in the Kingdom, according to the Thailand Film Office, which is under the Department of Tourism. The country’s exotic geography has served as a location for such well-known movies as the Oscar-winning The Deer Hunter (1978), Good Morning Vietnam (1987), and the 1974 James Bond film The Man With the Golden Gun. More recent Western films shot in Thailand include The Hangover Part II; the crime drama Only God Forgives, starring Ryan Gosling; and The Impossible, in which Naomi Watts and Ewan McGregor play tourists caught in the aftermath of the 2004 Indian Ocean tsunami.

Nonetheless, Thai land faces s t i f f g lobal competition. In animation, certain Thai studios have long-standing relationships with companies in South Korea, India, Canada and New Zealand. As the member nations of ASEAN prepare for greater integration and co-operation, Thailand is strengthening links with its neighbors and looking to bolster the reputation of the ASEAN region as a great place to make movies. Indeed, the success and ambitions of Thai film community were celebrated in April 2013 with the first ever Thailand International Film Destination Festival.

The Kingdom offers great business opportunities within its entertainment sector, including the potential to be a regional media center with its unique combination of a welcoming culture, diverse sceneries, high-level talent, well equipped studios, strategic location, relatively low costs, and government promotion. Additionally, various landscapes and a strong, unique culture make the country a source of inspiration and innovation for this industry. For example, Maya Bay, one of Thailand’s many beautiful beaches, famously served as the backdrop for the 2000 Hollywood blockbuster The Beach starring Leonardo DiCaprio.

Lately, the country has been gearing itself up for even more productions from different parts of the world, notably India’s fabled Bollywood. Together with Thailand’s stunning locations, the country has strong infrastructure and logistical networks that international film crews can easily take advantage of. The shipping of film, equipment, backdrops, and other props plays an integral part in this industry and the Kingdom offers sensible international shipping laws as well as a central location, making it easy to access all of Asia and even Australia, New Zealand, and the Middle East.

Also to note, foreign companies that have come to Thailand to film have been impressed by the technical facilities available in the Kingdom. Many even end up doing all their editing in Bangkok at a post-production facility such as Technicolor or Oriental Post, where work is done for major studios like Fox and Paramount. Meanwhile, many top Asian film-makers opt to do their post-production work in Thailand because of the very competitive pricing.

Currently, Thai government assistance is geared towards film services, such as the various post-production tasks. The National Federation of Thai Film Associations wants to see support extended to the entire filmmaking process, including help with preproduction expenses, such as script and director fees, and with after-costs related to marketing of the film.

The Thai film industry experienced a bright year in 2013 with a slew of appealing new movies and some support from the government, according to the National Federation of Thai Film Associations (NFTFA). Indeed, Mr. Visoot Poolvaraluk, NFTFA president, stated that the local film industry grew almost 100% in 2013 to 2 billion baht, up from 1.1 billion baht in 2012. The two highlights of 2013 were King Naresuan 5 and Tom Yam Goong 2. Another major boost came from the horror flick Pee Mak Phra Khanong, which raked in nearly 300 million baht within two weeks of its release.

It must be pointed out that Thai thriller and horror movies are selling like hot cakes on the international film market. A representative of Koch Media, an independent producer and marketer of digital entertainment products in Europe and North America, recently came to Thailand directly to buy horror movies to be shown in Germany next year.

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And finally, it must be mentioned that the highlight of 2012 was the Chinese film Lost In Thailand, written and directed by Xu Zheng. Shot in Thailand with the financial support of the Thai Ministry of Tourism, the comedy went on to become the highest grossing Chinese movie of all time, netting over 200 million dollars in China alone, where it beat the previous record held by “Avatar” & “Titanic” in numbers of tickets sold. Plus, the movie stimulated great interest amongst Chinese audiences regarding the Kingdom, which resulted in a surge of tourist arrivals from mainland China.

Thailand is the only real center for film making in all of Southeast Asia. Many other countries may aspire to make international

films, but they do not have the opportunity to work on many and so it is more of a dream than a reality. Even though the Kingdom is not yet the Hollywood of Asia, with government incentives for foreign filmmakers to shoot their productions in Thailand in the works, increased BOI attention to investment in entertainment infrastructure and additional funds for Thai filmmakers and others in the industry, it will not be long before Thailand takes its place as the entertainment capital of Asia … a true venue for producing, filming, buying, and selling film product around the world.

BOI’s Overseas Investment CenterIn the middle of 2012, the Board of investment approved the establishment of an overseas investment center to assist Thai nationals to invest abroad, initially in other ASEAN countries, but also in China, India and other regional neighbors. The center opened at the end of 2012, and is headed by Siriporn Nurugsa, Executive Director of Thai Overseas Investment Promot ion Division.

The idea behind this addition to BOI’s investment strategies, which had previously been focused on attracting foreign and domestic investment in to Tha i land , was to enhance the competitiveness of Thailand’s entrepreneurs’ and to increase the global brand of made in Thailand products.

The support now rendered by the BOI through its new overseas investment center include training programs for the Thai business community, the provision of information concerning areas / industries and opportunities in the target countries, business regulations, consulting services as well as continuing to include members of the private sector in BOI’s many overseas missions.

The Thailand Overseas Investment (TOI) center has recently opened a course for training Thai investors seeking investment abroad. The course already has 60 people ready to attend, with six assigned industrial groups: construction, agriculture and processed foods, textiles and clothing, energy, metal parts, and labor-intensive industries. The course is estimated to take about

60 hours, and BOI will take the participants to visit targeted countries such as Myanmar, Indonesia, and Kazakhstan.

BOI has previously arranged an investor training course organized under four groups and with 140 participants. Thus far, 16 projects have already been launched as a consequence.

Whether it is the opening of the One Stop Service Center for Visa and Work Permit, arranging for issuance of visas and work permits within 3 hour waiting period, or the One Start One Stop Investment Center, or now the provision of assistance to companies looking to invest outside of Thailand, investors have come to rely on the Board of investment for timely and responsive service. Yet one more reason to invest in Thailand!

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North South Corridor StrengthenedThe Asian development Bank (ADB) reports that the member countries of the Greater Mekong Subregion (GMS) have agreed to draw up a $50 billion pipeline of potential projects under a new Regional Investment Framework (RIF). These projects would include investments in railways and would be made over the next decade.

“The next generation projects can help boost cross border trade and investments, and stimulate jobs and growth,” said Stephen Groff, Vice President at the Asian Development Bank (ADB), which acts as Secretariat for the GMS Economic Cooperation Program. “Completing missing transport links remains at the core of the GMS program, but strengthening knowledge and soft infrastructure such as skills development and trade facilitation, and collectively managing regional public goods is also a priority.” GMS members include Cambodia, Lao PDR, Myanmar, Thailand, Viet Nam, and Yunnan province and the Guangxi autonomous region in the PRC.

A new bridge linking Lao PDR and Thailand has already been completed, strengthening the GMS North-South Economic Corridor. The bridge connects Chiang Kong, Thailand, with Huay Xai in Laos and is part of the economic development aimed at connecting Thailand and Laos with Kunming in southern China. The 1.2-kilometer bridge was constructed by Thai, Lao, and Chinese governments at a cost of US$48.96 million, or about THB1.57 billion. It serves as a cross-border transportation and trade network between Thailand, Laos, and other countries in the region, especially in the Greater Mekong Subregion.

Efforts will continue to extend and expand the exchange of traffic rights among countries, and to promote region-wide tourism opportunities. The pipeline of investments is projected to be more than $50 billion over the next nine years to 2022. To meet the sizeable financing requirements, member countries and their development partners will look to mobilize funds from the private sector.

Significant progress has already been made to enhance connectivity within the region in preparation for the ASEAN Economic Community 2015, particularly through the build-out of economic corridors to facilitate shipment of goods and services among GMS members.

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Top 10 Locations to RetireIn a recent survey special report by International Living Publishing Ltd, Thailand has been ranked among the top 10 locations to retire. The report notes the very low cost of living in Thailand, including dining, housing and good quality medical care.

Several countries were scored on real estate, special benefi ts, cost of living, ease of integration, entertainment and amenities, health, retirement infrastructure and climate. Entertainment and amenities was the highest score awarded to Thailand, followed by health care, which covers both cost and quality, and ease of integration.

It should be noted that in 2013, the HSBC Expat Explorer Survey ranked Thailand #1 for expat experience. ““For those looking for the best overall expat experience, our findings this year show Thailand as the top expat destination, being ranked as number one by our expats for ease of organizing healthcare, finding accommodation and the work environment. Last year this destination was ranked highly as a retirement hotspot so it’s great to see the country develop in terms of its economic appeal” said Lisa Wood, head of marketing at HSBC Bank International.

In a related category, the Board of Investment currently offers investment incentives for long-stay tourism, which includes land ownership and visas and work permits facilitaion.

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Annual Meeting of BOI Overseas Offices

Despite internal political tensions and natural calamities, The Kingdom of Thailand continues to maintain an open, market-oriented economy that encourages foreign direct investment as a means of promoting economic development, employment, and technology transfer. In recent decades, Thailand has been a major destination for foreign direct investment, and hundreds of multinational corporations have invested in the Kingdom successfully. Thailand continues to engage the entire world in both trade and commerce and seeks to avoid dependence on any one country as a source of capital investment. Today foreign and local investors are eagerly anticipating the implementation of an improved government water management plan and a comprehensive transportation infrastructure project, which will be critical elements in enhancing Thailand’s global competitiveness and asserting the Kingdom’s primacy in the ASEAN Economic Community from 2015 onwards.

Thailand has a history of being incredibly resilient. The country has gone through a number of challenges over the past decade, and every time it has managed to recoup and bounce back. Despite the sensational headlines, Thailand eventually will find its way out of this current turmoil. Indeed, the fundamentals, the basic structure of the national economy and the investment case for Thailand remain strong. Confidence in Thailand’s long-term potential persists among foreign and Thai investors, and the Board of Investment (BOI) continues to support and solicit projects from interested investors/companies.

Foreign direct investment (FDI) flows into Thailand in 2013 remained strong with a net application investment amount of over 500 billion baht for the January to November period. Japan was the top investor followed by China and Malaysia respectively. In fact, there was significant increase from ASEAN and China. Most major investment projects during 2013 were focused on

services, infrastructure, metal processing and agricultural products. Given the strength of the Kingdom’s tourism sector and the fact that last year it attained the rank as the ninth largest automotive manufacturing country, it is little wonder that these two sectors at t ract the most in te res t . L ikewise , w i th Thailand’s ever increasing growth in processed foods, investments in the agriculture sector will no doubt remain strong for years to come.

In order to help maintain investment growth in Thailand and to provide investors with timely information, the BOI has fourteen overseas offices

playing an important role in encouraging foreign investment around the globe. From the 23rd to the 27th of December 2013, the BOI Overseas Office Annual Meeting was held at the BOI headquarters in Bangkok for the purpose of brainstorming the BOI’s investment promotion strategy as well as BOI new investment policies that will help the BOI reach its investment target and objectives. During the five-day meeting, among the many issues discussed were the investment promotion strategy and activities for 2014.

The annual meeting also included invited speakers from economic-related government organizations to share the latest information or developments in specific areas. Among those attending were representatives from the Department of Employment, Ministry of Labour, Office of the National Economic and Social Development Board, Office of Transport Policy and Traffic from Ministry of Transport, Department of ASEAN Affairs from the Ministry of Foreign Affairs, and the Department of Trade Negotiations from Ministry of Commerce.

A presentation on Thailand’s Infrastructure and on the current situation was given by representatives from the Office of Transport Policy and Traffic and the Office of the National Economic and Social Development Board. They addressed the master development plan to improve national transport. Presently, Thailand’s infrastructure development is based on the Government’s country strategy, which revolves around three elements: Growth and Competitiveness, Inclusive Growth, and Green Growth. These “drivers” will assist the Kingdom to avoid the so-called middle income trap. Key projects will receive a budget allocation beginning in fiscal year 2015 to further develop urgent endeavors such as railway improvements (track strengthening) and adding ten lines to the Bangkok mass transit system.

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Labour issues also were highlighted; something investors are interested in knowing how Thailand will cope with any potential labour shortage. It was pointed out that in 2013-2014 there will be approximately 400,000 bachelor’s degree students and 80,000 undergraduate students entering the labour market. The Ministry of Labour, in cooperation with the Office of Vocational Education Commission, is working with both the public and private sectors to train and develop vocational manpower in various industries such as automotive, construction, petroleum, energy and communications.

With regards to the ASEAN Economic Community, speakers pointed out that Thailand is one of the most attractive countries for new business expansion. In addition, the importance of the ASEAN market also was considered a significant factor for worldwide revenues for the next two years. The representative from the Department of Trade Negotiations emphasized the accords in ASEAN that will be considered as investment opportunities. For instance, the arrangements mentioned were the ASEAN Agreement for the promotion and protection of Investment and The Framework Agreement on the ASEAN Investment Area. Thailand is also moving forward with trade agreement negotiations with other major trading partners.

It should be noted that Thai exports in 2014 should be among the first to gain from the economic recovery in the US, the European Union, China and Japan. Such a trend will compensate for slower domestic growth led by a slowdown in credit after a two-year consumer lending boom. Furthermore, Thailand’s economy has several points tipping in its favour: the region is emerging robustly from a weak global economy, helped by China; demand for imports in the US is improving steadily; and regional trade initiatives are being enacted on schedule. True, politics will continue to be a cause for uncertainty in the Kingdom, but if there is no widespread and sustained violence, it should only have a minor impact on the economy next year. Accordingly, it does appear that Thailand’s GDP is set to grow in 2014. Plus, foreign direct investment and tourism, which contribute 3-5 percent and 10 percent respectively, have stayed buoyant despite the domestic turmoil.

In order to maintain growing FDI to Thailand, the BOI constantly conducts investment promotion missions to the countries seen to have significant potential, and obviously the BOI Overseas Office Annual Meeting offered a crystal clear direction for moving forward in 2014.

Going Green: The Future is NowIn the years since the BOI Fair was successfully held in Bangkok, under the theme of going green for the future, Thailand has remained committed to adopting a more environmentally friendly and sustainable path to development.

Now, the manufacturing sector, which for obvious reasons has a close working relationship with the BOI, has come aboard with more than 10,000 factories joining a project to become green industries, with the support of the Ministry of Industry. The MOI is encouraging people to consume products and services that have been produced from environmentally friendly manufacturing processes.

As part of its commitment to a greener future for Thailand, the MOI is urging factories to consider the importance of environmental conservation and safety standards, under the Green Industry Thailand project.

This effort is also in keeping with the framework of the National Economic and Social Development Plan, 2012-2016, under which Thailand is to be transformed into a “green society.” The plan seeks to develop eco-industrial towns and restore the environment in major industrial regions by creating awareness of the need for co-existence between industries and communities.

Under the plan, the development of eco-industrial towns should start by setting a development framework and providing the components necessary to implement the eco-industrial town concept and strengthen standards for environmental and natural resource quality.

The plan also calls for measures to be put in place to encourage the private sector to invest in environmental rehabilitation. This will take the form of corporate social responsibility, together with cooperation from communities and the public sector.

In keeping with this goal, measures will be implemented to develop major new economic areas consistent with population size and carrying capacity. A database may also be developed to keep track of pollution so as to ensure the community’s balanced development.

During the past three years, 11,375 factories have joined the Green Industry project, which concerns sustainability and environmentally friendly production. Participating manufacturers who can achieve all the steps under this project will be awarded the Green Industry Mark, or GI Mark, which makes them eligible for additional benefits.

The Thailand Board of Investment has encouraged this process and the new policies to be announced will certainly reflect the need for sustainable and environmentally safe means of manufacturing.

Thailand is going green and the future is now.

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Thai Tax Comparatively LowIn its Paying Taxes 2014: The global picture, A comparison of tax systems in 189 economies worldwide, PricewaterhouseCoopers International Ltd. writes “…the global average Total Tax Rate has continued to fall in 2012, 14 economies have significantly increased their rate while 14 have reduced it.” The average for the Asia Pacific region, 36.4 percent, is below the global average, with profit taxes accounting for the largest portion of the Total Tax Rate. In fact, the report notes that in 23 of the 37 economies in the region taxes on profits account for more than half of the Total Tax Rate. The trend in the region is, however, for increasing labor taxes and reducing other taxes, which is also consistent with a global trend.

In East Asia and the Pacific, 7 of 25 economies have established electronic means for filing and paying taxes, including Thailand. “With the temporary reduction in corporate income tax rate from 30% to 23% in 2012 and to 20% in 2013 and 2014, Thailand has made significant moves to reduce the tax cost for corporate taxpayers.”

Looking at the World Bank’s Ease of Doing Business rankings investors will note that the total of all business tax in Thailand is just less than 30%. This includes corporate income tax, employer paid social security contributions, business specific taxes and others.

With its low taxation, good infrastructure and safe and convenient lifestyle it is little wonder that Thailand has remained for several years among the top 20 countries for Ease of Doing Business and is consistently ranked high for a range of services valued by investors.

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THAILAND ECONOMY-AT-A-GLANCE

Source: Stock Exchange of Thailand

Source: Bank of ThailandSET Monthly Closing Values

International Reserves / Short-term Debt (%)

Exchange Rate Trends

Industrial Capacity Utilization (%)

Head Office, Office of the Board of Investment 555 Vibhavadi-Rangsit Road, Chatuchak, Bangkok 10900, ThailandTel: +66 (0) 2553 8111 Fax: +66 (0) 2553 8222 Website: www.boi.go.th E-mail: head@boi.go.thBEIJINGThailand Board of Investment, Beijing Office Royal Thai Embassy No.40 Guang Hua Road, Beijing, 100600, P.R.China Tel: (86-10) 6532-4510 Fax: (86-10) 6532-1620 E-mail: beijing@boi.go.th

FRANKFURTThailand Board of Investment, Frankfurt OfficeBethmannstr. 58, 5.OG60311 Frankfurt am Main Federal Republic of Germany Tel: (49 69) 92 91 230Fax: (49 69) 92 91 2320E-mail: fra@boi.go.th

GUANGZHOUThailand Board of Investment, Guangzhou Office Royal Thai Consulate-General, Guangzhou, Room 1216-1218, Garden Tower, 368 Huanshi Dong Road, Guangzhou, 510064 P.R.C. Tel: (86-20) 833-38999 Ext: 1216 to 18 (86-20) 838-77770Fax: (86-20) 838-72700 E-mail: guangzhou@boi.go.th

LOS ANGELES Thailand Board of Investment, Los Angeles Office Royal Thai Consulate-General 611 North Larchmont Boulevard, 3rd Floor, Los Angeles, CA 90004 USA Tel: (1-323) 960 1199Fax: (1-323) 960 1190E-mail: boila@boi.go.th

MUMBAIThailand Board of Investment, Mumbai OfficeRoyal Thai Consulate-General, 1st Floor, Dalalmal House, Jamnalal Bajaj Marg, Nariman Point, Mumbai400 021 Republic of India Tel: (9122) 2204 1589-90 Fax: (9122) 2282 1071E-mail: mumbai@boi.go.th

NEW YORKThailand Board of Investment, New York Office 7 World Trade Center, 34th Floor, Suite F, 250 Greenwich Street, New York, NY 10027Tel: (1-212) 422 9009Fax: (1-212) 422 9119E-mail: nyc@boi.go.th

OSAKAThailand Board of Investment, Osaka Office Royal Thai Consulate-General, Osaka, Bangkok Bank Bldg. 7th Floor , 1-9-16 Kyutaro-Machi, Chuo-Ku, Osaka 541-0056 Japan Tel: (81-6) 6271-1395 Fax: (81-6) 6271-1394E-mail: osaka@boi.go.th

PARISThailand Board of Investment, Paris Office Ambassade Royale de Thailande, 8, Rue Greuze75116 Paris, FranceTel: (33 1) 5690 2600 (33 1) 5690 2601Fax: (33 1) 5690 2602E-mail: par@boi.go.th

SEOULThailand Board of Investment, Seoul Office #1804, 18th Floor, Coryo Daeyungak Tower, 25-5, Chungmuro 1-ga, Jung-gu, Seoul, 100-706, Korea Tel: (822) 319-9998 Fax: (822) 319-9997E-mail: seoul@boi.go.th

SHANGHAIThailand Board of Investment, Shanghai OfficeRoyal Thai Consulate-General15 F., Crystal Century Tower, 567 Weihai Road, Shanghai, 200041, P.R.China Tel: (86-21) 6288-9728, (86-21) 6288-9729 Fax: (86-21) 6288-9730E-mail: shanghai@boi.go.th

STOCKHOLMThailand Board of Investment, Stockholm OfficeStureplan 4C 4th Floor 114 35 Stockholm, Sweden Tel: +46 (0)8 463 1158 +46 (0)8 463 1172 +46 (0)8 463 1174 to 75 Fax: +46 (0)8 463 1160 E-mail: stockholm@boi.go.th

SYDNEYThailand Board of Investment, Sydney Office Suite 101, Level 1, 234 George Street, NSW 2000, Australia Tel: (+61) 2 9252 4884 Fax: (+61) 2 9252 2883 E-mail: sydney@boi.go.th

TAIPEIThailand Board of Investment, Taipei Office Taipei World Trade Center 3rd Floor, Room 3E39-40, No.5, Xin-Yi Road, Sec.5Taipei 110, Taiwan, R.O.C. Tel: (886) 2-23456663Fax: (886) 2-23459223 E-mail: taipei@boi.go.th

TOKYOThailand Board of Investment, Tokyo Office Royal Thai Embassy8th Fl., Fukuda Building West,2-11-3 Akasaka, Minato-ku, Tokyo 107-0052 JapanTel: (81 3) 3582 1806Fax: (81 3) 3589 5176E-mail: tyo@boi.go.th

Facts about ThailandPopulation (2010) 66 millionASEAN Population 600 millionLiteracy Rate 96%Minimum Wage 300 Baht/day

GDP (2012) US$ 366 billionGDP per Capita (2012) US$5,389GDP Growth (2012) 6.5%GDP Growth (2013, projected) 3%Export Growth (2012) 3.1%Export Growth (2013, projected) 0.0%

Trade Balance (2012) US$ 6.0 billionCurrent Account Balance (2012) US$ -1.5 billionInternational Reserves (2012) US$ 181.61 billionCapacity Utilization (2012) 65.23%Manufacturing Production Index (2012) 177.20Core Inflation (2013, projected) 1.0Headline Inflation (2013, projected) 2.2Consumer Price Index (Dec 2013) 106.01 (2011=100)

Corporate Income Tax 10-20%Withholding Tax 0-15%Value Added Tax 7%

Dec Average Exchange RatesUS$1 = 32.34 baht€1 = 44.27 baht£1 = 52.91 baht100 ¥ = 31.28 bahtCNY1 = 5.33 baht

Top 10 Exports 2013 (Jan-Nov)

Product ShareValue

(US$ bn)1 Motor cars, parts and accessories 10.68 22.43 2 Automatic data processing machines

and parts thereof7.75 16.29

3 Refine fuels 5.50 11.56 4 Precious stones and jewellery 4.52 9.49 5 Chemical products 4.00 8.40 6 Polymers of ethylene, propylene, etc

in primary forms3.91 8.21

7 Rubber products 3.72 7.81 8 Rubber 3.51 7.37 9 Electronic integrated circuits 3.10 6.51

10 Machinery and parts thereof 2.97 6.25 Total 210.09

Source: Ministry of Commerce

Source: Bank of Thailand

Source: Bank of Thailand BOI

January 2014

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