Is It A Good Idea to Invest in Thai Manufacturing Sector?
Why not? Economic stability, competitive investment, and well-developed infrastructure have attracted a continuous flow of financing to the country’s manufacturing sector from foreign as well as domestic sources. And that is why today Thailand is one of the strongest manufacturing bases in the ASEAN region, whereas the second-largest in the trade block. Investments made in the industrial areas like auto manufacturing, food products, and simple manufacturing have typically laid the groundwork for the value chain and has provided and export-driven flow of revenue for the Thai government to offer further improvements to the infrastructure alongside financial incentives.
Sure, manufacturing industry did suffer in the past due to natural resource exploitation, but the policymakers have implemented steps for developing a more profitable industrial and export base. Being aware of the falling into the middle-income trap, the Thai government has been and still is promoting new industries to drive up the incomes. Moreover, the Thailand 4.0 development plan that rolled out in the year 2016 has embodied these concepts while focusing on the building capacity for products, thereby promoting investment in the cutting-edge industry to move away from the production-based economy towards something that is service-based.
Additionally, Thailand’s automotive sector continues playing a major role in the kingdom’s manufacturing and exporting scene, holding the top spots when it comes to production value and exports. Secondly, the country’s robust auto industry, the e-industry is one the strongest manufacturing segments that accounted for almost 15% of the exported revenues in the year 2016.
The industry leads the region and presently promotes hundreds of domestic factories and a lot of which are operated by the leading electronics companies across the globe, which includes Hitachi, Panasonic of Japan and Mitsubishi, etc.
Also, Thailand is a leading supplier of agricultural goods because of its well-developed food processing segment that monetizes the natural productivity of the country while expanding its value chain, from the field to market. Hence, the kingdom’s food processing industry has become an advanced market in South-east Asia, enabling exporting of value-added products to suitable international markets.
Moreover, large foreign as well as domestic players have established strong grounds in the country. In the year 2016, food imports totaled to BT386.5bn that is roughly 40% of Thailand’s food exports value. The country’s steady economy, developing infrastructure and relative political stability is expected to continue Thailand’s position as one of the leading regional industrial producer as well as exporter.
