Portuguese companies are not concerned about the limit on foreign ownership in Thailand since they are mostly small and medium businesses (SMEs) that are keen on partnership rather than gaining full control, says Pedro Siza Vieira, minister assistant to the prime minister of Portugal.
He also urged the need for greater bilateral trade and investment relationship between the countries, identifying seafood and tourism as the industries for immediate cooperation and development of digital economy and infrastructure building as areas for future collaboration.
"This is the one area where I think the Portuguese are different from other investors," Mr Vieira told the Bangkok Post, referring to the Thailand Foreign Business Act (FBA) which limits foreign shareholding to 49% of a business and includes three lists of work in which foreign participation is either prohibited or restricted.
Last month, the Joint Foreign Chambers of Commerce in Thailand said the most pressing issue for foreign businesses is the limit on foreign ownership. The American Chamber of Commerce in Thailand and the European Association for Business and Commerce in Thailand have in the past also called for restrictions in the FBA to be lifted. Thailand is now considering amending the law and make it less restrictive to attract more foreign investment to the redevelopment of the Eastern Economic Corridor (EEC).
"Large companies from Germany, France, Italy or the UK, would want it differently but Portugal believes in more of a joint venture partner model of expansion,'' he added.
He explained that when Portuguese companies go overseas, they always seek local partners who know the business and the place better and Thailand is one of the best joint venture partners of his country in Southeast Asia for more than half a millennium. Therefore, the foreign ownership issue is "not a particular concern" for them.
The Thai and Portuguese relationship is the longest the Kingdom has had with any western country. It is also the oldest that Portugal has with any Asian country with the first bilateral treaty signed during the Kingdom of Ayutthaya in the 16th century.
"This is significant because our country has been independent for almost one thousand years and half of that period we have diplomatic relations with Thailand," he said. "We think there are good opportunities for trade and investment flows, exchange of experience in some sectors in which the countries are particularly interested in."
Mr Vieira said the Portuguese government is "very glad" to see "surge" in Thai investment in Portugal that is significant not only in terms of "value" but also in "visibility".
"Portugal is part of the European Union so it can be a platform for operating in the EU. It can also be a platform for the whole of the Portuguese speaking world, including Brazil and countries in Africa," he said.
"These two investments do add value in terms of perception of Portugal as a quality destination for tourism but this is not the only sector where investments are made in recent years," he added. Around 30,000 Portuguese tourists come to Thailand every year and about 25,000 Thai people visit Portugal annually.
The flow of trade and investment between the two countries is still "very low", Mr Vieira admitted, and added that the focus of his office now is to make aware of the opportunities in Portugal and in Thailand for businesses and investors.
The trade between the two countries amounted to US$211.43 million in 2015 with top export products from Thailand include cars and auto parts, ready-made clothes, plastic beads, electrical machinery, air-conditioners, paper and rubber products etc. Thailand had a trade surplus of $104.21 million in that year.
"Last year, we opened a trade and investment agency here in Bangkok, ensuring that Portuguese companies have a better awareness of Thailand," he said. Software development, infrastructure and energy are the areas where Portugal has developed the know-how and capacity and he believed that these sectors would be interesting for Thailand. "We would like to see Portuguese companies explore and seek opportunities in these sectors," he said.
Portuguese food and wine have become popular worldwide with a sizeable increase in exports to Europe and the United States, Mr Vieira said and added that his government is keen on increasing the exports to Asean as well.
"There has been an investigation by the European Union that included a canned seafood unit in Portugal. But that is a European operation that has been following EU standard so there is no concern for us in that respect," Mr Vieira said when asked about the illegal, unreported and unregulated (IUU) fishing situation in Thailand.
Reports last month indicated that the EU is still unhappy with Thailand regarding the IUU fishing issue after a review and had decided to retain the yellow flag. If the EU were to issue a red flag, Thailand's seafood exports would be banned from entering member countries.
Of the 15 EU members, Portugal is the largest consumer of fish, exceeding 60 kilogrammes per head a year among a population of 10.32 million people as of 2016.
The Portuguese government is also "very interested" in learning about the EEC, especially the 600-rai Digital Park Thailand, and Mr Vieira said Lisbon will make sure that its investors are aware of the opportunities there. He said he has already met with the Board of Investment and the EEC management team during his visits.
"In the past two decades, there has been a significant surge of digital economy in Portugal, particularly in software development and they have been operating in servicing industries such as automotive, healthcare, and financial services. And we believe that these companies are looking for opportunity to expand and grow," he said."Given that these are areas of focus also for Thailand and particularly EEC projects so we hope that they can take advantage of those opportunities."