Leading foreign businessmen have advised Thailand to take a combination approach to investment policies and not to completely scrap zone-based criteria for incentives.
Fromleft: Nandor von der Luehe, chairman of the JFCCT, Industry Minister Prasert Boonchaisuk and Vice Industry Minister Piyawat Niyomrerks, at yesterday’s meeting. PATIPAT JANTHONG
Speaking yesterday after a meeting of the Board of Investment (BoI) and the Joint Foreign Chambers of Commerce in Thailand (JFCCT), Industry Minister Prasert Boonchaisuk said the JFCCT proposed that Thailand maintain its policies in which incentives are based on the location of the investment.
The BoI has conducted a review of investment policies.
The new regime, which is due to take effect in the middle of this year, is expected to classify incentives by the investment sector instead of the zone.
Mr Prasert said the JFCCT believes that zone-based criteria benefit the country in terms of income distribution.
The nationwide increase of the daily minimum wage to 300 baht on Jan 1 has lessened Thailand's competitiveness in terms of labour costs.
There are no incentives for businesses to invest in very remote areas where transport is not convenient if wages are at the same rate everywhere.
Mr Prasert said the BoI will also take into consideration new investment privileges launched in other countries such as Malaysia and Indonesia to ensure Thailand's revised policy is competitive with regional peers.
The JFCCT also proposed that Thailand take steps to facilitate foreign businessmen in terms of business visas. They currently need a work permit to attend meetings or seminars in Thailand.
The JFCCT said this was a time-consuming process that foreigners are not required to go through in Singapore, Hong Kong, Malaysia and Indonesia.
Mr Prasert said the recently announced government budget of 2.2 trillion baht for the next seven years will boost investors' confidence in Thailand.
Most of the money will be used for upgrading infrastructure. This excludes the budget for improving telecommunication networks to serve 3G mobile technology and water management projects that will enhance Thailand's competitiveness globally.
The BoI has set a target of investment value this year at 700 billion baht, compared with 1.4 trillion baht in 2012, saying last year's figure was very high due mainly to business rehabilitation from heavy floods.
Mr Prasert said the BoI and his ministry will gather more opinions from both domestic and overseas investors before making a final decision on the revised investment policies.