The government plans to issue new land-leasing rates for areas due to be developed as industrial estates in the proposed special economic zones (SEZs) to tackle the problem of surging land prices.
The soaring prices are deterring investment in the SEZs, said Veerapong Chaiperm, governor of the Industrial Estate Authority of Thailand (IEAT).
The new rental rates are expected to be reasonable in the long term, thereby helping to promote the SEZs and in turn support the local border economies.
Mr Veerapong said the Treasury Department would play a major role in working out the details of land-leasing rates as well as regulations for industrial estates in five of the six SEZ provinces. The plan is due to be finalised next moth.
The first phase of industrial SEZs covers the provinces of Sa Kaeo, Trat, Tak, Mukdahan, Songkhla and Nong Khai.
However, the government's new rent regulations will exclude Nong Khai, where the private sector has already started developing the project.
"Next month, the Industry Ministry, the Treasury Department and the committee overseeing the SEZs will work out appropriate land-lease rates," Mr Veerapong said.
Cheap land prices along the remote border areas have jumped 10% so far this year from speculation after the government plotted the areas that would be developed into SEZs.
The government has invoked Section 44 to allow the military to be used in transferring some state-owned land for SEZ development, shortening complicated paperwork in order to promote the SEZs as soon as possible.
The Treasury Department initially set the land-leasing period for SEZs at 50 years, but that will now be extended by an additional 49 years.
Leasing rates for areas that have been completely developed in preparation for industrial investment will be in a range of 100,000 to 150,000 baht per rai per year.
That is cheap compared with rates equal to 150,000 to 250,000 baht per rai per year in neighbouring countries also trying to attract foreign investors.
With a concerted effort by the government, the IEAT believes construction of the first phase of SEZs could start in 2017.
The first phase of construction will cover 700-800 rai in Tak, 654 rai in Sa Kaeo and 1,097 rai in Songkhla.
The IEAT expects the second phase will cover 4,437 rai of land, on which the government is expected to spend 6.65 billion baht to develop. Second-phase construction is expected to start in 2020 for completion in late 2021.