Thailand was formerly known as “Siam” and still known as “Suvarnabhumi” or the “Golden Land,” and more recently known as the “Land of Smiles”. The land welcomes foreign traders and investors. Thailand invites traders from as far afield as the United States, Europe, Africa, the Middle East, South Asia, China, Taiwan, Japan. It also does so from much closer parts of Southeast Asia for over a millennium. For ages, it has been an interest and preference of foreign investors to start a business in Thailand.
Thailand has preserved its cultural identity despite multiple foreign influxes and influences. Furthermore, it has never been colonialized by a Western force. While Thailand is deeply anchored in and proud of its independence and traditions. It is also unexpectedly cosmopolitan, open-minded, inviting to outsiders, and self-assured for a developing nation.
Attractions to Start a Business in Thailand
There has been political unpredictability of the last two decades. Yet, Thailand’s economy has shown consistency and endurance that few other developing countries can match. Thailand’s important assets include the following:
Great Location
Thailand acts as a strategic buffer zone between China and India. It is also a handy economic hub for China, India, Japan, Taiwan, and other Southeast Asian countries. It also connects rising economies like Myanmar, Laos, and Cambodia with flourishing economies like Malaysia and Singapore economically.
Excellent Market Size and Economy
There is a report of the International Monetary Fund (IMF) World Economic Outlook Database for October 2019. It states that Thailand’s domestic consumer market reached 69.8 million people. It also declares a nominal GDP per capita of around USD 7,808, and an adjusted GDP per capita (based on Purchasing Power Parity) of around USD 21,361.
World Bank expects Thailand’s GDP is to grow at around 2.7 per cent in 2020. It is according to the World Bank’s January Global Economic Prospects. Moreover, according to Statista, Thailand’s average trade balance in 2019 was around USD 9.6 billion, with exports exceeding imports.
Strategic Trade Alliances
Thailand is a founding member of ASEAN (Association of Southeast Asian Nations), AFTA (ASEAN Free Trade Area), and the ASEAN Economic Community (AEC). The AEC’s goal is to combine the economies of Thailand, Malaysia, Singapore, Brunei, Indonesia, the Philippines, Cambodia, Laos, Myanmar, and Vietnam. It is similar to what the European Economic Community (EEC) achieved before the European Union was formed (EU).
The AEC has a population of approximately 661 million people. It places it just behind China and India in terms of population size but ahead of the EU. The region has a population of approximately 447 million people. It also includes NAFTA (North American Free Trade Agreement) members, who have a total population of approximately 490 million people.
In 2019, the total GDP was USD 520 billion. In 2018, ASEAN holds the credits to garner USD 155 billion in foreign direct investment. Investing in Thailand provides foreign direct investors with a strategic foothold in a vast and rapidly growing economic bloc.
Growing World-class Infrastructure
Thailand’s 77 provinces, as well as neighbouring Laos, Cambodia, and Myanmar connect via an expanding highway system. Secondly, Thailand also features 11 international airports, a slew of local airports and six deep seaports. Additionally, it holds two international river ports, as well as container terminals, tank farms, and liquid jetties. Moreover, according to the 2019 half-year statistics of the Airports Council International, Suvarnabhumi Airport is one of the world’s busiest airport. It ranks in the global top 25 (8th in East Asia) with over 60 million passengers annually.
Thailand’s present railway network runs over 4,000 kilometres, connecting Thailand to Malaysia and then to Singapore. Bangkok has two rail networks for public transportation. A high-speed rail network connecting all of Thailand as well as Southern China is one of the upcoming projects. Bangkok’s public transportation system will be expanded to include the suburbs. Additionally, Thailand is improving its air and maritime transportation systems in general.
Inspiring International Rankings to Start a Business in Thailand
Nominal Gross Domestic Product
According to the IMF World Economic Outlook Database for October 2019, Thailand ranks 22nd out of 188 nations.
The Economist Pocket World in Figures 2020 Rankings
Thailand has the following ranks, according to the most recent online numbers from The Economist Pocket World in Figures 2020:
- 12th largest agricultural output
- 18th largest manufacturing output
- 20th largest economy by purchasing power
- 24th biggest exporter
- 25th largest trade in goods
- 23th largest industrial output
- 31st biggest export volume
- 24th largest earnings from services and income
- 26th largest economy
- 27th largest services output
Board of Investment of Thailand
Thailand has the following ranks, according to the latest numbers from Thailand’s Board of Investment:
- 1st in the export of natural and synthetic rubber
- Ranks first as a producer of hard disk drives
- 1st in the export of rice
- 2nd in export of sugar
- 5th largest producer of trucks
- 7th largest producer of motorcycles
Other Ranks of Significance
- According to the World Bank’s 2019 Ease of Doing Business Report, Thailand is the 27th easiest country in the world to do business in. It is 2nd among emerging markets in East Asia.
- There is a UNCTAD (United Nations Conference on Trade and Development) World Investment Report of 2019. It states that Thailand is the 18th most attractive host economy in the world.
- Thailand ranked 40th out of 141 nations in the World Economic Forum’s 2019 Global Competitiveness Index. Moreover, it was third in Southeast Asia after Singapore and Malaysia. Remarkably, it was ahead of several established countries in Europe.
- According to A.T. Kearney’s 2019 Global Services Location Index, Thailand is in the seventh position in the world. The nation is fourth in Southeast Asia after Malaysia and Indonesia.
- In terms of the overall expat experience, Thailand stands 22nd, behind Singapore (#2), Vietnam (#10), Hong Kong (#15), Malaysia (#16), India (#18), and ahead of China (#26) and the Philippines (#24). Thailand ranks eighth in terms of total living standards. Notably, both are on the basis of HSBC’s 2019 Expat Experience Report.
How Can You Start A Business in Thailand?
Be it geography, location or citizens, Thailand suits good for a multitude of business ventures. Therefore, if you are willing to invest overseas, Thailand can be your best option. Importantly, the Board of Investment and Royal Thai government always promotes foreign business ventures in Thailand.
But before you start a business in Thailand, you must know the legal structure well. It is always an act of priority. If you are not having ample time to study the whole, consult a counsel. There are various tax and non-tax benefits that you can miss out on without proper guidance.
Thailand is one of the very few countries to offer up to 300% tax exemption on research and innovation projects. Therefore, before you start a business in Thailand, reach us by writing to [email protected]. We will help you with the best legal guidance and assistance.
