It’s all about the economy as ministers seek to attract more investment and jobs by making things easier. Light at the end of the tunnel even as business sentiment right now has reached rock bottom according to an index at the economic think tank the University of the Thai Chamber of Commerce.
The cabinet on Tuesday approved a package to boost inward investment into Thailand for foreign firms. It is also reported that among the measures in the ‘Thailand Plus package’ is a move to ease the problems that expats are having with the TM30 regulation as part of an easier visa and work permit environment for employees of foreign firms in Thailand.
The Thai cabinet on Tuesday gave the green light to a range of measures designed to make Thailand an easier country to do business in for firms bringing inward investment and creating jobs in the kingdom, particularly in the high technology sector.
Among the initiatives announced in the package dubbed the ‘Thailand Plus Package’ are measures aimed at addressing the TM30 controversy and making it easier for foreigners to comply with Thailand’s immigration laws.
Government package is aiming to make easier for foreign firms in Thailand to do business
It comes as part of a package of measures aimed at making life easier for employees of foreign firms setting up in Thailand. It is reported to also include measures making it easier to obtain visas and work permits. The scope of the package was outlined by Mr Kobsak Pootrakool who is a spokesman for the ruling Palang Pracharat Party and former minister at the Office of the Prime Minister.
Thailand lags behind on inward investment
Figures disclosed recently show Thailand has for years now, been lagging behind its key neighbouring competitors when it comes to inward investment. For instance, in 2018 Vietnam an economy roughly half the size of Thailand generated 47% more inward investment while Indonesia left the kingdom trailing with 109% more investment.
The government is forecasting that the new package now approved, will see 5,000 new foreign companies setting up in Thailand which will have a direct impact on 40,000 Thai jobs.
Tax breaks of 50% on top of existing breaks for investments of ฿1 billion-plus in Thailand
The new package of measures gives a generous corporate tax cut of up to 50% to firms who invest ฿1 billion or more by 2021 in Thailand with a 5-year range of benefit. This would be in addition to other exemptions available for smaller investments.
The package also proposes increased incentives for foreigners and foreign firms setting up educational businesses and advanced training centres. Under the new government plan, there is also provision for elements of direct financial assistance.
Mr Kosak revealed that plans are in the pipeline for large foreign companies such as Google, Huawei, IBM and Microsoft to expand their business operations in the kingdom.
Business confidence at a 19 month low
The news comes as the University of Thai Chamber of Commerce announced that business confidence in Thailand has hit the lowest level in 19 months. Reports suggest that quite a few firms are experiencing cash flow difficulties. However, in spite of this, it is being reported that business people feel that things may begin to improve towards the end of the year. The figures compiled by the Business and Economic Forecasting Unit at the university show the confidence index at 46.5.
Forecast of 2.6% growth this year may be exceeded if the government can roll out stimulus quickly
The expert think tank believes that the economy will grow by 2.6% this year and perhaps 3% if the government can speedily roll out its economic stimulus package. It places particular faith in the price guarantee programme for crop growers.
TM30 report comes 12 days after Joint Chamber Chairman said government economic unit had recommended its abolition
The news that the package contains an easing of the TM3o rule and regulations comes just 11 days after it was reported in the Thai Examiner that Stanley Kang, the Chairman of the Joint Foreign Chambers of Commerce in Thailand (JFCCT), had said that an influential unit within the Thai government responsible for eradicating red tape, had recommended the abolition of TM30 altogether and that his organisation had made submissions to Thai authorities for easing the hardship caused by the regulation.
The details of what was agreed by the cabinet on TM30 as well as other visa and work permit requirements have not yet been clarified.
Old regulation from the 1979 immigration act brought into play at the end of March this year
TM30 is an immigration regulation that has existed since 1979 under the Immigration Act but which had not been universally enforced until the end of March this year.
It requires landlords or property owners to notify the immigration bureau if a foreigner stays at a location for over 24 hours and imposes fines and sanctions for failure to do so.
The enforcement of the old regulation has caused severe difficulties to many expats staying long term in the kingdom, many of whom for lifestyle or for work, travel regularly within Thailand.