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AEC & Thailand’s Readiness for Foreign Investment

AEC & Thailand’s Readiness for Foreign Investment

Thailand has faced tough challenges over the past few years. Many fears that Thailand has lost its appeal for foreign investors. However, compared to neighboring countries in terms of geographical location and economic structure, Thailand proves to be in an advantageous position. Located at the heart of ASEAN, Thailand can be thought of as the gateway that offers easy access geographically to other ASEAN as well as major Asian countries including China, Japan, and India. With this quality, many experts all agree that Thailand still remains as the most attractive investment destination in the Southeast Asian region.

While several Thai entrepreneurs and investors focus on expanding their business to other ASEAN countries, financial experts believe that Thailand still has a very strong potential and is most equipped to become the heart of ASEAN, which can help attract more foreign investors. Thailand is considered to be a strong global manufacturer and has one of the world’s fastest growing hospitality industries – the capabilities that can allure many investors. All of this will create new, exciting
business opportunities for Thai investors to expand their business in the future.

Thai Military Bank (TMB)’s research indicates that, in order to attract more investors, Thai entrepreneurs must formulate new strategies to accommodate foreign investors. The new strategies must cover 4 aspects that will help secure Thailand as an investment hub in the ASEAN region.


Currently, Thailand’s research and development spending is the 3rd biggest in ASEAN and 41st biggest in the world behind Singapore and Malaysia. The estimated spending is around 1.46 billion dollars or 0.25% of the GNP (Gross National Product). The industry which should be granted with the most research and development budget is the agricultural products as Thailand is the number-one natural rubber exporter in ASEAN. However, most of the exported rubbers are in the crepe rubber form, which adds little value to the product.

Environmental awareness:

This is one of the topics that Thai companies should be most concerned about as this will demonstrate the responsibility to the world’s environment.

Cooperation with other member countries:

Thailand should focus on industry cooperation with other ASEAN member countries. For example, Thailand can become a regional hub for the automotive industry through cooperation with other neighboring countries including Indonesia and Malaysia. Thailand automotive industry is the 9th largest in the world; Indonesia, 17th; and Malaysia, 23rd, with a collective annual output of 4.2 million vehicles or 5% of the world’s production output.

Moreover, Thailand’s Tourism Industry can also be leveraged. Thailand is located at the heart of ASEAN and has world-class airport facilities, so it is easy for the country to cooperate and send tourists to such countries as Malaysia, Lao, and Myanmar.

Manufacturing industry efficiency:

Thai companies should strengthen its manufacturing capabilities while producing value-added products. If Thai companies really pursue these strategies, Thailand’s dream of becoming a regional business hub, with strong capabilities and potential, will certainly come true.

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