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BOI pushes “Thailand Investment Year” to accelerate economic shift

For 2019, BOI has set investment application target at 750,000 million baht

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To promote the new package and share with investors Thailand’s updated investment policy and incentives, BOI sets “Thailand Investment Year – What’s New?” as the theme of its annual seminar scheduled for 4 March 2019.

Main discussions and content will be centered around new investment measures that will be in focus this year, as well as the investment support from the government.

The investment package will keep the country’s high investment momentum going following the remarkable 25% increase in investment applications received by BOI against the 2018 target.

The country earlier set a goal to attract 720,000 million baht investment application but ended up seeing over 900,000 million baht investment application value.

This is credited mainly to the country’s comprehensive ecosystem for investment, ranging from concrete progress of infrastructure development, to clear national direction and continuous government support.

For 2019, BOI has set investment application target at 750,000 million baht.

It is hoped that the Thailand Investment Year package and latest announced investment measures will boost investment value and enable the government to achieve its target.

Thailand Investment Year: Transforming Challenges into Opportunities

Realising that large investment projects which adopt advanced technology or are in knowledge-based industries are crucial to boost economic growth and transformation, BOI has initiated this Thailand Investment Year

Package to attract projects with minimum investment value of 1,000 million baht in targeted activities that are entitled to 5-8 years of tax holiday and do not extend project implementation deadline.

Applications will be opened until 30 December 2019 and the approved projects will receive 50% reduction of corporate income tax for three years on top of the basic package.

Targeted activities are, for example, manufacture of aircraft or aircraft parts, R&D, biotechnology, manufacture of advanced technology electrical products, manufacture of high-technology medical devices, digital services, etc.

Connectivity Enhanced by Rail System Development

Considering rail as a strategic logistics system that plays an important part in investment ecosystem, BOI recently introduced new measure to attract investment in rail system development.

The new measure focuses more on engineering activities and a comprehensive range of investments related to rail systems such as train structures, passenger cabins, system control units, bogies, braking systems, electrification systems, and signaling systems as well as rails.

Rail system development related projects that apply for BOI promotion by 30 December 2021 will be eligible for 50% corporate income tax reduction for another 3-5 years, depending on designated locations, after the expiry of 100% exemption privilege for 5-8 years.

This special package is also expected to help kick-start the establishment of a rail production hub in the northeastern region where there are several supporting factors such as existing automotive part and assembly industries, universities, and upcoming development of rail networks.

Digital Infrastructure & Startup EcosystemGet a Boost

With the aim of attracting foreign and domestic investments in Thailand’s digital industry, BOI has recently approved investment measure to support innovation and digital ecosystem, such as innovation incubation center.

The requirement of which is adjusted to increase minimum facility area to 1,000 square metres and to include innovation incubation plan approved by BOI to ensure concrete development and incubation for entrepreneurs.

A new investment promotion category, Maker Space or Fabrication Laboratory providing machinery and tools used for making prototype products, has been added with five years of tax holiday and import duty exemption on machinery.

In addition, a new category for Co-working Space has been included to connect local developers with the global community and encourage startups and venture capitals from all over the world to invest in Thailand. Promoted projects will receive duty exemption on import machinery.

BOI has also launched an investment incentive scheme for the Smart City initiative, which is designed to upgrade people’s quality of life with seven intelligent platforms; namely, Smart Environment, Smart Mobility, Smart People, Smart Living, Smart Economy, Smart Governance and Smart Energy.

Thailand Investment Year – What’s New?

To kick off the Thailand Investment Year 2019, BOI will share its perspective, new measures and key policy at its annual seminar. Themed “Thailand Investment Year – What’s New?” the seminar, to be held on 4 March 2019 at Royal Jubilee Hall, Impact Muang Thong Thani.

In addition to the discussions and presentations on BOI’s comprehensive support measures and investment support from various government agencies, the afternoon session will be an investment clinic, where businesses will have the opportunity to discuss with BOI and related government agencies, including National Innovation Agency (NIA), Digital Economy Promotion Agency (DEPA), Export-Import Bank of Thailand (EXIM) and Ministry of Industry (MOI).

https://www.boi.go.th/upload/content/ThailandInvestmentYear_5c6cc320d4954.pdf

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Ecommerce

Thailand Ecommerce Market: Shooting For Success

At present, the Thai ecommerce market is valued at USD 3.5 billion. According to a Google Temasek study, Thailand’s e-commerce market value is expected to surge to 13 billion USD by 2025 on the back of strong global demand for Thai products.

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Thailand’s nascent e-commerce industry is thriving and making serious money. According to the Ministry of Digital Economy and Society, Thai e-Commerce grew the most in ASEAN, the value of Thai ecommerce grew 14% in 2018, estimating that the value would increase to USD 103 billion, and its growth is expected to hit 20% this year.

The region is flourishing

According to the report Asia-Pacific B2C E-Commerce Market, over one half of total global online retail sales happens in the Asia-Pacific region. Over 50% of all the online shopping for retail goods and services takes place in the Asia Pacific region, and South-East Asia accounts for about 40% of the e-commerce market of the region.

Southeast Asia is definitely a new big e-commerce hit, and the region is currently a very attractive market for big players involved globally in the e-commerce sector and smaller local companies.

At a reflection point of Internet penetration and mobile devices rapid spread, the population of Southeast Asia is quickly adapting its behaviors to take advantage of new purchasing products and services online opportunities.

According to the latest e-Conomy Southeast Asia 2018 report from Google and Singapore-based Temasek, the digital economy in Southeast Asia is on track to hit $240 billion by 2025, which is $40 billion more than previous estimates.

The digital economy in Southeast Asia is on track to hit $240 billion by 2025

As e-commerce continues to grow exponentially, Southeast Asia will account for 20% of worldwide e-commerce by as early as 2022.

Thriving Market

With a GDP worth of USD 602 billion, Thailand is the second largest economy in Southeast Asia, surpassed only by Indonesia. In addition to that, according to EcommerceIQ research, Thailand is also the second largest Business-to-Consumer (B2C) e-commerce market in the region.

At present, the Thai ecommerce market is valued at USD 3.5 billion. According to a Google Temasek study, Thailand’s e-commerce market value is expected to surge to 13 billion USD by 2025 on the back of strong global demand for Thai products.

As Ebay’s General Manager for Hong Kong, Taiwan and Southeast Asia border trade Jenny Hui has stated, Thai products are in global demand, with jewelries and watches, health and beauty products, auto parts, home and garden, and collectibles rapidly gaining popularity.

Electronics is currently the leading product category, accounting for USD 1.3 billion market share.

Fashion is second, accounting for USD 525 million. According to Statista, online shoppers in Thailand spend on average $283.95 USD online annually, and four years from now, this sum is expected to grow to $401.73 USD.

Young Mobile-First Generation of Users

What makes the country a true breeding ground for ecommerce is its great number of internet users – one of the highest in Southeast Asia. At present, Thailand has an Internet penetration rate of 57.4% with Millennials making up the majority and spending on average 53.2 hours a week online.

When comparing the number of Internet users over the past 10 years, there were only 16.1 million Internet users in 2008 and the number reached approximately 45 million in 2018; moreover, at present there are 124.8 million mobile subscribers, 44 million people using LINE messenger and 52 million Facebook users.

Internet-savvy young people here definitely play a key role in driving mobile commerce. Thailand is a regional leader in mobile commerce, as 52% of online transactions take place via mobile devices (only South Korea is higher with 58%). According to the Thailand Marketing Research Society, 71% of smartphone users in Thailand shop online an average of twice a month, while 90% intend to shop online in the future. 

On top of that, a growing middle class with increasing incomes also plays a huge role in this surge trend.

Big players bet big on it

Thailand’s market size and e-commerce potential has made it an appealing market to foreign investment. In the last two years, Chinese Internet giants like Alibaba and JD.com have invested in Thailand.

Alibaba through its USD $3.7 billion investment in Lazada in 2018, and USD $306 million injection into the first stage of the Eastern Economic Corridor (EEC), while JD.com has poured USD $457 million into a joint-venture with Thailand’s leading retail conglomerate, Central Group. E-commerce is the leading category that has received the greatest foreign investment compared to payment, logistics, fintech and food and beverage sectors.

Consequently, the increase in interest from foreign investors in Thailand’s e-commerce sector has encouraged local firms to increase their competitiveness and encouraged more SMEs in Thailand to innovate in the areas of online commerce, fintech and artificial intelligence. The investment also resulted in more joint ventures between offline wholesale companies and online companies.

Affiliate marketing opportunities

According to affiliate network Indoleads, e-commerce success brings also a bunch of great affiliate-marketing offers. About 97% of all Thailand’s ecommerce brands use affiliate marketing to attract customers. That means the opportunities for publishers are limitless, and the programs are abundant.

Lazada, Shopee and JD Central are one of the most attractive ones. The three platforms have strong financial support from larger firms. Lazada is backed by Chinese e-commerce giant Alibaba, while Shopee is supported by Tencent, another massive Chinese company. JD Central is a joint venture of China’s JD.com and Thailand’s Central Group.

These three online marketplaces in Thailand are drawing each in over 30,000,000 sessions per month, providing brands with high visibility, and give publishers a higher chance to earn commission through sales.

Not only big international players have appealing affiliate programs. A variety of local e-commerce stores widely use affiliate marketing. For example, Namu life, a leading retailer of skincare products produced with natural ingredients, is one of the most popular shops in this niche. It is not a secret that skincare products are always in high demand in Thailand, so there is always a great choice of online stores selling them.

Another one is CMART, Thailand’s most popular e-commerce website, selling almost everything from electronics to health and beauty products and providing top-notch service. CMART has developed a successful multi–channel strategy and innovative operating model.

The travel aggregators and platforms, such as Bookaway, are also extremely popular not only among locals, but also thousands of foreigners permanently living in Thailand.  

In the perspective of flourishing Thailand ecommerce market, affiliate marketing is very likely to present real and meaningful chance to reach consumers in novel, creative way to drive performance-based results. Publishers definitely should consider this option for sure.

Indoleads are happy to present you all these amazing opportunities. Indoleads is one of the leading affiliate platforms in South-East Asia. They have 500 CPS/CPL/CPA direct affiliate offers from over 60 countries around the globe. Our team is dedicated to your affiliate business success, so join Indoleads to promote Thailand brands and cut a piece of cake from their enormous revenue!

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Banking

Aspire Set to Become First SME Neobank in Southeast Asia with US$32.5 Million Raise

The recent financing has been led by Mass-Mutual Ventures Southeast Asia with participation from Silicon Valley’s Arc Labs and existing investors Y Combinator, Hummingbird and Picus Capital.

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SINGAPORE, August 1st 2019. Y Combinator backed Aspire, who is on a mission to reinvent SME banking across Southeast Asia, announced today a US$32.5 million raise.

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Press Release

How is Thailand Bringing Technology to the Table?

In Asia, a country like Thailand has taken the initiative to implement agricultural biotechnology in its industry. The country has long been considered as the kitchen of the world since it’s agricultural exports play a crucial role in its GDP.

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Technology is revamping how the world works. We are leaving in a tech-savvy world where technological advancements are making their way to every industry.

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