On the fast lane to a hi-tech economy
Government remains confident it will see B300bn in investments in the Eastern Economic Corridor this year as global recovery drives the push for automation, smart cities, and electric vehicle manufacturing
The government remains committed to the Eastern Economic Corridor (EEC), firmly believing investment value in the corridor will reach at least 300 billion baht this year as expected.
According to Kanit Sangsubhan, secretary-general to the EEC Office, private investment is increasing this year, driven by global economic recovery and rising global trade.
"Actual investment was pretty low last year as investors were hesitant because of Covid-19 outbreaks," said Mr Kanit. "Investors are now expected to ramp up investments this year."
Last year, actual investment in the EEC totalled only 96 billion baht, making up 46% of total investment applications filed through the Board of Investment (BoI).
The EEC is part of the government's strategy to move Thailand towards a high-tech economy.
The area spans a combined 30,000 rai plot of land in the provinces of Chon Buri, Rayong and Chachoengsao to accommodate investments in targeted industries, focusing largely on advanced technology.
The EEC will host 12 target S-curve industries: cars, smart electronics, medical and wellness tourism, agriculture and biotechnology, food, robotics for industry, logistics and aviation, biofuels and biochemicals, digital, medical services, defence, and education development.
The government is offering a raft of privileges for investments in the EEC, including standard tax holidays for five to 10 years depending on investment categories, corporate income tax exemption for an additional two years, and a 50% corporate tax reduction for three years for investment projects related to human resource development.
The EEC attracted investment applications for 117 projects in the first quarter with a combined value of 64.4 billion baht, 39% higher than the total value of the 117 projects filed in the same period of 2020.
"The office is upbeat about surpassing its goal of 300 billion baht of actual investment this year," said Mr Kanit. "Many projects in EEC have been implemented since early this year."
5G driving investment
Many investments relating to 5G technology are scheduled for this year and include both infrastructure projects and production technology upgrades by manufacturers in the EEC.
Mobile phone operators and related industries are in the process of investing in the infrastructure required for 5G technology in EEC while investments in a smart city in Ban Chang in Rayong is about to be completed as well. Meanwhile, investments in infrastructure projects for Pattaya Smart City are scheduled to begin this year.
Last year, Pattaya announced a five-year roadmap for its transformation into a "smart city" to become a hub of economic, investment and tourism activity.
The strategy is designed to create new opportunities for Pattaya residents, improve its environment, and serve its multicultural community.
The city's authorities conducted public hearings on the scheme, which is expected to boost the economy in post-Covid-19, to improve digital information and geoinformatics of the plan between 2021 and 2025.
The digital transformation will help improve government services, reduce inequality in education, and increase investment opportunities.
The digital system will be applied to the transportation, tourism, and medical industry, as well as town planning.
At both Ban Chang and Pattaya smart cities, big data will be used to improve people's quality of life, including a 3D system to boost people's incomes, a closed-circuit TV system to ensure public security, and various other innovations to facilitate and enhance local life.
The government will also support factories in EEC to upgrade manufacturing via 5G technology.
Currently, 300 factories located in the industrial estate of WHA Corp are in the process of upgrading manufacturing to automation which uses 5G technology and another 10,000 are expected to upgrade their production process to an automated system within three to five years.
The EEC Office is also focusing on electrical vehicle (EV) manufacturing as EV projects in EEC are scheduled to see investments this year and in 2022.
The government will support infrastructure to boost EVs and three cores of EV development: charging stations, significant parts of motor and battery and software.
The manufacturing of EVs in Thailand can happen faster than the government's plan, which aims for domestic production of EVs to account for 30% of car manufacturing by 2030.
Meanwhile, Chinese automaker Great Wall Motor (GWM) has chosen Thailand as its base for the first smart factory in Southeast Asia in a move to boost sales in international markets.
The facility, located in the Eastern Seaboard Industrial Estate (Rayong), opened officially on June 9.
Another key project to make electric cars in Thailand is a joint investment between Taiwan's Foxconn and state-run energy group PTT Plc.
Foxconn and PTT signed a memorandum of understanding on May 31 to make EVs and their components for the Thai market.
Under the partnership, an "open platform" that provides both hardware and software services will be available to automakers in the country.
Around US$1 billion (31.6 billion baht) will be initially invested in the joint venture, with the figure potentially rising to $2 billion at a later stage.
Another vital project is a joint venture deal between Evlomo Inc, a Florida-based company working on EVs, and Rojana Industrial Park Plc to invest $1.06 billion in an 8-gigawatt battery energy storage project in Nong Yai district in Chon Buri.
The project is expected to create 3,000 jobs, bring technology for electric mobility to Thailand and upgrade Nong Yai to become a manufacturing hub for EVs in Asean.
Under the investment plan, the joint venture in the initial stage will see the construction of a battery production plant with a capacity of 1GW, worth $143 million. Construction is expected to be completed in 18-24 months.
The batteries will be used by four-wheeled vehicles, buses, heavy-duty trucks and two-wheeled vehicles. The output can also be used for energy storage for sale in Thailand and abroad.
According to Mr Kanit, his office is also focusing on promoting and drawing investments in the bio-circular and green (BCG) economy and the medical industry in which many projects are expected to take off this year.