The International Monetary Fund (IMF) has asked the country to emphasize more on the policies for growth and shift from relying on the electronic and automotive industry. As mentioned in the World Bank Group report 2019, the country generated 78.45 scores out of 100 in Ease of Doing Business. And therefore it ranked 27 out of 190 economies and 2nd among its ASEAN neighbors after Malaysia.
As you know the tourism sector in Thailand has been its pillar of growth, the country serves as a gateway to one of the most dynamic markets. With that, the service sector, including tourism and financial services are continuing to contribute to the country’s GDP.
Based on Thailand’s National Economic and Social Development Board (NESDB), currently, its growth is at 3.3%. The inflation rate is at 1.5% and that too within the government’s target range of 1 to 4%. On the other hand, private investment has increased in Thailand by 3.9% while amounting to 17.6% of the country’s growth share.
Private investment expansion involves encouraging investors affected by the Sino-US trade tension to set-up a production bases in Thailand. Seeing the trend, it is likely that public investment in infrastructure will be the key policy in Thailand to drive the economy in 2019.
Also, increased spending in construction, equipment, and machinery has equally supported private investment growth. To attract more investors, the country is working to open new doors to foreign investors by allowing foreign participation in the targeted industries. In fact, the Department of International Economic Affairs promotes a brand new engine of growth that includes businesses in next-generation such as smart electronics, wellness tourism, biotechnology and food, and medical. Additionally, the new sources of investments will include aviation, biofuels, logistics, digital technologies, medical services, and robotics.
Thailand’s Foreign Business Act allows 49% of foreign shareholdings. Besides, Thailand has the second lowest Corporate Income Tax rate in ASEAN that is capped at 20%.
