Thailand prepares new industrial estates for more FDI

Industrial Estate Authority of Thailand announced plan to open up 12 more industrial estates across the country to attract more foreign investments, focusing on auto-parts makers, electronics manufacturers, and food and pharma industry.

The Industrial Estate Authority of Thailand (IEAT), a state enterprise charged with developing and running industrial estates in Thailand, recently announced its strategic plan to develop 12 new industrial estates in total area of more than 7,000 acres.

The plan will focus on 3 main sectors, namely, 1) SME industrial estates to be located in northern, northeaster, and eastern Thailand; 2) logistics industrial estate catering especially to border trade related businesses in Chiang Rai, and 3) AEC industrial estates to connect the east-west economic corridors in the Northeast.

So far, there have been positive responses from private industrial estate developers. Nava Nakorn PCL., one of the biggest Thai industrial state developers, owner of Nava Nakorn Industrial Park in Pathumthani and Nakorn Ratchasima, expressed its interest to partner with IEAT to develop an SME project. It is looking to invest around $40 million in an estate in eastern Thailand, which will welcome auto parts manufacturers, electronics manufacturers, and food and pharmaceutical industry.

Nava Nakorn's position is in line with that of Thai Industrial Estate Ltd., developer of Ban Wa Hi-Tech Industrial Estate which confirmed that the company is planning to invest in another SME industrial estate also in Kabin Buri, Prachin Buri Province in the east, which will also serve as a gateway to AEC trade with neighbouring Cambodia and beyond.

IEAT has also proposed that it will invest in constructing one-stop-service Total Solution Centre (TSC) in all of the new estates and will assist in promoting the estates at home and abroad. At the moment, applications are being accepted from private sector developers until 31 May 2013. It is expected that IEAT will receive a good number of applications and should be able to conclude the process soon.

Benefits of setting up businesses in IEAT industrial estates

The benefits for investors in industrial estates include

1) Comprehensive services essential for industrial operation – such as transportation, warehouses, training centers and clinics

2) Non-Tax privileges including:

• The right to own land in an industrial estate
• The right to bring in foreign skilled workers as well as their spouses or dependents
• The right to remit money abroad

3) Tax privileges including import/export tax and duty exemptions; value-added tax (VAT) as well as excise tax on machinery, equipment, components, raw materials and supplies used for the production of goods and other merchandise

4) Other privileges under Board of Investment of Thailand (BOI)

At present, IEAT runs 46 industrial estates in throughout the country, 11 of which have been developed solely by IEAT, and the rest as joint-venture with private sector.

For more information please visit www.ieat.go.th or www.boi.go.th

Praphan Samphaiworakit
Reports from New Delhi
16 May 2013