12 June 2015
Deputy Prime Minister M.R. Pridiyathorn Devakula said that Thailand had received a good response from foreign investors.
Speaking in the program "Moving Thailand Forward,” the Deputy Prime Minister revealed that during his recent visit to Japan, he learned that the number of new companies seeking to co-invest with Thailand exceeded the set target.
Over the past four months, 150 foreign investors have proposed to co-invest with Thailand. It is expected that in the next two years and a half, these companies would complete establishing their production bases here and start to export.
In his opinion, the Deputy Prime Minister said that foreign investors were interested in investing in Thailand, because they were impressed by the favorable investment atmosphere here.
However, he said, Thailand should improve the tax system in order to encourage more investors to use Thailand as a multinational trade center. It should also focus more on co-investing with foreign investors in new industries, with complex manufacturing processes and with innovation development.
Concerning the Thai economy over the past nine months, he said that the overall situation has improved because of the expansion of the tourism sector and public investment. The private sector investment is also picking up, but the export sector still needs some time for improvement.
According to a report by the Office of the National Economic and Social Development Board, Thailand’s total investment grew by 10.7 percent in the first quarter of 2015, accelerating from a 3.2 percent growth in the previous quarter. Public investment expanded by 37.8 percent. Private investment expanded by 3.6 percent. For the first time in seven quarters, the Business Sentiment Index stood at a level higher than 50, which is the level at which business expand their investment.
The export value in the first quarter was recorded at 52.9 billion US dollars – a 4.3 percent contraction – and the export volume declined by 2.6 percent. The decline was a result of the slowdown in the global economy.
Meanwhile, the Bank of Thailand’s Monetary Policy Committee on 10 June 2015 decided to maintain the policy rate at 1.50 percent per annum. It said that economic momentum in the first four months of 2015 softened due to sluggish private consumption and continued contraction in exports, as a result of a slowdown in the Chinese and Asian economies and a shift in global trade structure.
Nevertheless, increased disbursement of public investment expenditure and continued improvement in tourism helped shore up the economy. In the periods ahead, the Thai economy is projected to improve gradually, but subject to downside risks from slower-than-expected recovery of the global economy, especially China and other Asian economies. Therefore, the monetary policy stance should continue to be accommodative in order to support the economic recovery.
The Monetary Policy Committee will closely monitor Thailand’s economic and financial developments, and stand ready to utilize the available policy space appropriately in order to support the ongoing recovery and maintain long-term financial stability.