Japanese investors are expected to increase their activity in Thailand, following a forecast by the Japan External Trade Organization (Jetro) of a rebound in tourism and business in the second half of this year, according to Transport Minister Suriya Jungrungreangkit.
Mr Suriya made the comment after talks with Jetro Bangkok president Kuroda Jun and executives at the Japanese Chamber of Commerce in Thailand.
Participants discusses the latest Jetro report on business sentiment of Japanese corporations in Thailand for the first half of this year, and pledges to cooperate more in the field of transport.
The report found that business sentiment had levelled off in the first half but was expected to improve in the next six months as a result of the Thai government’s planned economic stimulus measures and ramped-up tourist spending during the high season.
In trying to gauge how much Japanese firms will invest in Thailand this year, the survey found that 45% said their spending would remain unchanged, 23% aim to increase it and 18% said they would reduce their investment.
Asked about the export outlook for the second half, 48% of respondents expected no change, 33% plan to increase exports, and 20% anticipated a decline.
The major export markets of Japanese companies in Thailand include Vietnam, India and Indonesia, and their expectations were based on the assumption the Thai baht will stay at the level of around 35.50 to the US dollar. The currency is currently trading around 36.50.
The challenges Japanese companies face while investing in Thailand are intense competition from other foreign companies (65%), rising labour costs (43%), increasing material prices (42%) and exchange-rate fluctuations (27%). Respondents were allowed to give multiple answers.
Asked what measures Japanese firms would like to see the Thai government take, they listed stimulating consumption (31%), solutions for environmental problems (21%) and improved infrastructure (20%).
Areas where Japanese companies agree the government has done well so far include basic infrastructure (25%), visa and permit issuance (19%) and adopting digital systems in state administration (12%).
Mr Suriya said the government’s Ignite Thailand policy also received positive feedback as the survey showed Japanese companies have high expectations in terms of logistics improvement (41%), future automotive manufacturing (33%), tourism (23%) and the medical and health care sectors (20%).
The minister said Japan has shown interest in various infrastructure development plans presented by the ministry.
These include the expansion of airports, such as the third-phase development of Don Mueang Airport, construction of the south terminal of Suvarnabhumi Airport, expansion of Chiang Mai and Phuket airports, and construction of Lanna airport in the North and Andaman airport in the South.
In addition, Japan has shown interest in the nationwide double-track railway project and 20-baht flat fare policy for mass-transit rail service in Bangkok.
It also suggested a feeder system should be put in place to ensure more convenience and help save costs for commuters.
