UOB Thailand is committed to supporting large local corporations expanding into Southeast Asia to capitalise on the significant growth potential of regional economies, while also investing in domestic digital technology.
According to UOB's 2024 business outlook study, international expansion is a top priority for Thai businesses, with around 90% of them planning to expand within three years. Southeast Asia, particularly Vietnam, along with mainland China are key targets for this growth.
Thailand is Vietnam's leading trading partner in the region, with bilateral trade exceeding US$20 billion in 2022.
Vira-anong Chiranakhorn Phutrakul, deputy chief executive and country head of wholesale banking at UOB Thailand, highlighted Vietnam as a prime destination for outbound investments by Thai corporations.
The country's strong economic growth, large population, lower labour costs and favourable regulatory environment, including free trade agreements, are highly attractive to Thai investors.
However, she said Thai businesses face challenges such as a lack of in-house talent, limited access to overseas customer bases, and insufficient legal, regulatory and compliance support when expanding overseas. To address these issues, UOB's Foreign Direct Investment Advisory (FDIA) units across Southeast Asia provide comprehensive advice to customers to ensure efficient and effective market entry, leveraging the bank's regional expertise.
Singapore-based UOB Group set up the FDIA unit in 2011 and has assisted more than 4,200 foreign companies in cross-border expansion.
In Thailand, the unit has supported more than 370 companies, facilitated more than $1.6 billion in projected foreign direct investment (FDI), and created more than 18,000 job opportunities since 2019.
In addition to the outbound business expansion of Thai business operators to regional markets, Thai corporate customers are increasingly focusing on investing in domestic digital technology, including data centres, artificial intelligence (AI), and cloud. This investment is crucial for developing infrastructure and enhancing the digital transformation needed to improve business efficiency, according to Ms Vira-anong.
Furthermore, she said inbound foreign investment in Thailand, particularly in the automotive and electronics sectors, is showing a positive trend, with Chinese, Taiwanese and South Korean investors leading the charge. The electric vehicle (EV) sector is a significant focus of FDI in Thailand.
"Despite a slowdown in new car sales in the country this year, both for EVs and internal combustion engine vehicles, due to economic conditions, EV sales are expected to continue growing in the long term, in line with government policy," said Ms Vira-anong.
The Thai government aims to increase EV sales to 30% of total new car sales by 2030. In 2023, EV sales accounted for 15% of all car sales.
However, EV sales growth decelerated this year because of economic challenges and increasing competition in the sector.