Thai outbound direct investment for the first eight months is estimated at US$5.5 billion, down from $7.8 billion in the same period last year, a Bank of Thailand official said yesterday.
Total investment abroad, however, is billions of dollars higher than the central bank's Thai direct investment (TDI) figure this year, as the bank did not take into account two large acquisition deals in Singapore and China by Thai conglomerates, said Pongpen Ruengvirayudh, the deputy governor for monetary stability.
Charoen Pokphand Group bought HSBC's 15.6% stake in Ping An, China's biggest private insurer, for $9.4 billion in April, while Charoen Sirivadhanabhakdi acquired Singapore's Fraser and Neave Ltd in a deal worth $11 billion.
Mrs Pongpen said TDI totalled $12.7 billion last year.
Direct investment abroad is another way to help balance the influx of offshore capital flows to Thailand and ease pressure from the baht's strength.
The central bank has encouraged investors to expand investment abroad to enhance competitiveness and explore opportunities for long-term benefits, Mrs Pongpen said.
Thai entrepreneurs are capable of competing against other players, and the move to support greater foreign investments is seen as a long-term gain despite short-term volatility causing funds to flee the domestic market.
"We have seen a number of major corporations in the energy and production sectors expanding their business ventures abroad, while medium-sized enterprises have started to follow suit," Mrs Pongpen said
"It's expected that foreign investment by Thais will gradually increase compared with foreign direct investment into the country."
The Finance Ministry's Fiscal Policy Office is also studying the use of tax incentives to spur overseas investment.
Mrs Pongpen said TDI is flowing into nearby countries and set to increase as investors try to reap production benefits in large markets such as Indonesia or to take advantage of low labour costs in Myanmar.
The Thai financial market still faces volatility on US debt concerns.
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