Overview of best prospect sectors, major infrastructure projects, significant government procurements and business opportunities.
Thailand’s 2019 reforms in business regulations facilitated set-up processes and reduced the time to start a business from twenty-nine days to six days. The country considerably improved its standing in the World Bank’s “Doing Business 2020”, gaining six positions from the previous year, moving to the 21st position.” The improvement was attributable to the government’s efforts to streamline the business approval process by adopting digital systems for government services and improving rules and regulations to catch up with recent developments. The rights of borrowers and creditors were strengthened, and improvements in the system of land administration were implemented. The country took steps to clarify corporate governance, ownership, and control structures by enacting legislation requiring companies to appoint independent members of boards of directors and to establish audit committees.
To help Thailand’s economy develop over the next 20 years, the Thai government adopted an economic model called Thailand 4.0, which is focused on transforming Thailand into a value-based economy built upon science, technology, innovation, and creativity. The government aims to improve its education system and to develop the technological skills of highly educated workers to serve target industry sectors. The target sectors are the “First S-curve” sectors, including next-generation automotive, smart electronics, medical and wellness tourism, agriculture, and biotechnology, as well as the “New S-curve” sectors including robotics, aviation, and logistics, biofuels and biochemicals, digital industries, and medical hubs. These development strategies are in line with the government’s policy to upgrade Thailand from a middle income to a highly developed country by 2036. With the rapidly increasing demand for English language education in Thailand, the country has experienced a growth in the number of international schools. There is also a significant increase in the number of Thai children who study abroad at an early age.
To further boost the country’s competitiveness, the Thai government generated a long-term infrastructure plan to accelerate economic growth. This plan prioritizes the improvement of existing infrastructure as well as the construction of numerous new projects in many areas, including the expansion of seaports, roads, rail systems, and ICT infrastructure. To provide additional maritime transport infrastructure and facilities, a $3 billion project will expand port capacity in the Eastern Seaboard area, including a cruise ship port in Sattahip and upgrades of the major shipping ports of Laem Chabang and Map Ta Phut. Once completed, Laem Chabang should be able to handle 18 million TEU (twenty-foot equivalent units) a year, while Map Ta Phut should be able to handle 19 million additional tons of cargo annually of petrochemicals and natural gas.
In the energy sector, Thailand aims to be a hub of power trade in Southeast Asia by improving its high-voltage transmission lines across the country to facilitate regional power trading and sales of surplus electricity. The improvement of high-voltage transmission lines is a part of digitization, which will support grid connection in Southeast Asia in the near future. Moreover, Thailand has refocused its energy mix towards renewable sources. Regarding the new renewable energy capacity, there are four major targeted renewable energy efforts: solar, biomass, Electricity Generating Authority of Thailand (EGAT) hydro-floating solar, and community power plant by biogas and biomass. The EGAT Hydro-Floating Solar (Hybrid) plan consists of sixteen projects located in the EGAT’s nine dams. The Ministry of Energy is pushing forward a plan to promote Thailand as a free trade hub for liquified natural gas (LNG). To support Thailand as a regional LNG trading hub, the Industrial Estate Authority of Thailand signed an agreement worth $1.3 billion with Gulf MPT LNG Terminal Company to build the country’s third LNG import terminal. Commercial operations for the project are slated to begin by 2025. According to the Department of Mineral Fuels, Thailand also plans one floating storage regasification unit (FRSU), which will have a capacity of 2 million metric tons per annum and will be ready in 2028.
With solid healthcare infrastructure in place, an international reputation for highly-skilled medical professionals, international standard medical services, and affordable healthcare services, Thailand has become a destination for medical travel, not only for ASEAN but for the world. Thailand has 61 hospitals and healthcare institutions certified by Joint Commission International (JCI), a U.S. healthcare accrediting organization. Doctors in the country are well trained in the latest treatments and procedures, and hospitals are outfitted with cutting-edge medical technology. Additionally, doctors and other staff in the hospitals have proficient English-language skills. According to the World Travel and Tourism Council, in 2019, Thailand ranked as the fifth highest destination for inbound medical travelers. Thailand ranked third in the world in revenue from medical travelers after the United States and South Korea. In 2019, approximately 3.5 million medical tourists visited Thailand. Several hospitals are expanding, renovating, and upgrading their facilities.
The franchise industry remains very popular among Thai investors and is quite successful in the Thai market. Experts identified 575 franchise concepts in 2020, representing about two percent annual growth, according to the Department of Business Development, Ministry of Commerce. Ninety-five percent of the growth was from local franchise businesses and the other five percent from international franchise businesses. Food restaurants, quick service, and casual dining have the largest market share with 31 percent, while beverages are second with 24 percent. Education service franchises (including education and child development) come in third with a share of 18 percent. Even though international franchises are fewer than domestic, they control 65 percent of Thailand’s total franchise market value.