Prime Minister Srettha Thavisin on Thursday highlighted three approaches to strengthen the capital market under the Pheu Thai-led government, even as "the long-term fundamentals remain sound and resilient".
Speaking at a Securities and Exchange Commission seminar, the premier said the government sees a need to develop strategies for the capital market to conform with changing investment trends globally.
Digital and sustainability aspects have affected the entire capital market, the overall economy and people's well-being. The Thai government wants to focus on supporting the country's transition to a digital and sustainable economy, he said.
For example, the government endorsed the Thailand ESG (TESG) Fund, which is expected to raise more than 10 billion baht in funding, said Mr Srettha, who is also the finance minister.
The TESG Fund is a long-term investment option that lets investors deduct their investment in the fund from their personal income tax, while it benefits companies in creating sustainable business opportunities, he said.
The government has also agreed in principle to reduce barriers related to conducting a digital asset business, partly to support more equal competition in the digital asset market.
Reducing the financial burden of digital asset business operators would encourage the use of technology in fundraising through investment tokens, as well as promote innovation in the business sector, said Mr Srettha.
"The government has come up with three approaches to strengthen the capital market," he said.
"First, the administration attaches great importance to attracting foreign investment and is pushing the capital market to be a regional investment destination for various sectors."
The government wants to speed up negotiations and the expansion of free trade agreements, opening new markets and creating economic cooperation with many countries, especially those in Europe, the Middle East and Africa, said Mr Srettha.
"We also want to promote business operations in Thailand to foreign investors by facilitating ease of doing business," he said.
"We will present investment information about the Thai stock market through roadshows to build confidence among foreign investors."
The second approach is to shift the government's focus to sustainability.
The government will support every sector in achieving Thailand's Sustainable Development Goals (SDGs), aiming for carbon neutrality by 2050 and net zero greenhouse gas emissions by 2065, said Mr Srettha.
"The administration will work to encourage the capital market to develop mechanisms for the business sector to have enough funds to transition towards environmentally friendly businesses and provide small enterprises access to knowledge, technology and funds to prepare for environmental crises in the future," he said.
Mr Srettha said the government would continue to promote policies to stimulate the green bond market, raising funds to support the SDGs, while establishing sustainable financing policies in line with international standards.
Finally, he said fundraising for the business sector would be enhanced, especially for digital businesses, small and medium-sized enterprises (SMEs) and startups to ensure adequate capital to run their businesses and expand to the global market.
In terms of the digital economy, Mr Srettha said the government will encourage investment in high-tech industries, artificial intelligence, and R&D in the fields of technology and innovation.
SMEs and startups will be supported for product development, financing and the opening of new markets, he said.