The government has shelved plans to amend the Foreign Business Act (FBA), Prime Minister Prayut Chan-o-cha told a luncheon yesterday organised by the Joint Foreign Chambers of Commerce in Thailand.
Members of the Joint Foreign Chambers of Commerce in Thailand pay attention to Prime Minister Prayut Chan-o-cha's speech in Bangkok yesterday. SOMCHAI POOMLARD
He said the move was aimed at raising the confidence of foreign business communities.
"The FBA will be left untouched for now, and any potential future changes will be for the better," Gen Prayut said, easing foreign investors' concerns after recent Commerce Ministry plans to revise the Act.
Last week, Commerce Minister Chatchai Sarikulya insisted amendments to the FBA would mainly involve investment promotion, simplifying business procedures and facilitating trade and investment.
The reaction by the 800 attendees was largely positive, as many foreign chambers were anxious about the issue, but others felt major questions remained unanswered by the government.
Apart from the FBA, Gen Prayut insisted the economy still had great potential, as household consumption and private sector investment had increased from the third quarter.
GDP growth of 2-3% next year is expected, while this year growth is set for 1%, he said.
Applications for Board of Investment incentives have increased now that its committees have been appointed.
Gen Prayut expects foreign direct investment into Thailand to double in 2015 from this year as the result of economic policies.
"However, the recovery won't be fast due to domestic and international factors, but we have regulations to move the economy forward. The situation will improve in the fourth quarter and continue into 2015," he said.
Part of the plan is to expedite government spending for the fiscal-2014 and -2015 budgets to focus on job creation and income distribution to low-income people. "Job creation and income distribution may not seem like a big deal, but they will give people more money to buy your products," he said. He also outlined the basic infrastructure improvements in telecommunications and transportation that should improve Thailand's connectivity to neighbouring countries and China.
Special economic zones (SEZs) will also play a pivotal role as Thailand pushes to increase exports. Five SEZs are planned for this year and seven next year.
Gen Prayut is also pushing a Thailand+1 policy that will allow international companies to expand into neighbouring countries.
"If you're interested in this kind of investment, then go to Dawei, because this project is important. It will benefit people in the region, making Asean stronger and closing regional inequality gaps," he said.
The prime minister said he would reveal soon what the digital economy policy would entail.
The Information and Communication Technology (ICT) Ministry is going to be restructured as the Digital Economy Ministry to reflect the changing digital environment.
"Thailand is already a hub in Asean, so the ICT infrastructure needs to reflect that too. Right now our internet connections are not stable, but they will be better," he said.
Service infrastructure also needs to be developed for businesses that rely heavily on IT such as movie studios, design firms or creative entrepreneurs.
"It will take eight years to complete,
but it will be faster if you come to help us," he said.
During a question and answer session afterward, Deputy Prime Minister MR Pridiyathorn Devakula said the service sector had been satisfactorily liberalised except for the insurance and telecommunications. He expects the service sector will be liberalised within two years.
Restrictive work permit and reporting regulations have been a subject of complaints for years.
"Through the international headquarters and international trading centre programmes, work permits will be automatically extended for two years, plus they won't need to report every 90 days. Everyone else can report by email without having to show up in person," said MR Pridiyathorn.