This is for all Japanese Investors who are planning to invest in Thailand? In a recent trade interaction, the Japanese Government has declared its intent to promote investment in some of the cream sectors of the Thai business ecosystem. Read and scroll to the bottom to know more about the announcements and get complete support in starting your business in Thailand.
Japan-Thailand Trade & Economic Relationship Development
Recently, Deputy Prime Minister Supattanapong Punmeechaow led a delegation to roadshows in Tokyo and Kanagawa between April 19 and 23, 2022. In this delegation, Japan has pledged to increase investment in Thailand. This promotion in investment aims in high-technology sectors like Electric Vehicles (EVs), Smart Electronics, Medical Services, and Bio, Circular, and Green (BCG) businesses.
On April 21, 2022, a meeting was held amongst the Chief Cabinet Secretary Hirokazu Matsuno and Minister of Economy, Trade, and Industry Koichi Hagiuda and Mr. Supattanapong. Henceforth, the three parties also agreed to keep up their strategic partnership as Thailand and Japan commemorate their 135th year of formal diplomatic relations.
The visiting Japanese prime minister offered an investment in the Eastern Economic Corridor (EEC) this year in the electrical vehicles industry as Thailand and Japan committed to enhancing their economic relations. The commitments were made on May 2, 2022 when Thai Prime Minister Prayut Chan-o-cha and his Japanese counterpart Fumio Kishida reviewed strategies for economic cooperation.
The two sides talked and decided to develop a five-year plan for economic cooperation as soon as possible. This is to develop their economic partnership, according to Thai officials. The two nations’ economic cooperation will be promoted through the five-year plan.
Mutual Cooperation Resolution between Japan and Thailand
Additionally, Prayut vowed to assist Japan’s Asia-Japan Investing for the Future (AJIF) initiative. The plan, according to the prime minister of Japan, will encourage Japanese businessperson to invest more in the EEC, particularly in the electric vehicle (EV) sector.
The Japanese prime minister stated that Japan views Thailand as the most significant investment base in Southeast Asia and that there is potential for investments by Japanese businesses in Thailand.
During the discussion, Kishida also stated that Japanese automakers will continue to use Thailand as their base of operations and would concentrate on producing cutting-edge vehicles.
The two prime ministers decided to cooperate in the development of sophisticated human resources. More Kosen (National Institute of Technology) branches would be established in Thailand, according to Kishida.
Japan plans to promote carbon-zero emissions and long-term benefits for investments in Thailand. Additionally, Japan will also work with Thailand to create infrastructure and clean energy technology. Kishida was cited as saying this during the meeting.
Japan plans to invest 25 billion baht ($728 million) in the EEC this year. This was 19.8 billion baht last year. Prayut praised Kishida for giving Thailand support in a variety of ways to lessen the effects of the Covid-19 problem. Prayut expressed gratitude to Japan for donating Covid vaccines, oxygen-generating devices, and storage equipment and a soft credit to Thailand.
How is the collaboration beneficial for Japanese Investors in Thailand?
When bond between two nations grows strong at government level, it opens new scopes of development for all subordinate points. Therefore, Japanese Investors will get extra scope of starting or growing business in Thailand. Following are the few checkpoints clarifying the benefits of a Japanese Investor in Thailand:
- As the Japanese government plans to increase investments in Thailand at public sector level, it will announce plans that will be beneficial for the private sector as well. Therefore, you can expect ease of moving out from Japan and investing in Thailand.
- The BCG Economy of Thailand is seeking for innovative projects. Moreover, businesses focusing on this model will attract special privileges like tax holidays from the Board of Investment of Thailand.
- Japan plans to increase investment in the EEC region. This will give Japanese Investors great access to the Industrial Estate Authority of Thailand. Now it will be easy to do business more freely in the Free Trade Zones and SEZs in Thailand.
- Japan is a global leader in most of the sectors that needs focus in Thailand. Additionally, these are the very sectors that need expert attention in Thailand. So, as a Japanese Investor, there will be no dearth in the scope of investment in Thailand.
Eventually, more benefits will turn up when various projects on the proposed agenda will start to turn up. One of the most crucial aspects is that Japan is the 2nd largest Construction Industry in the world. In the course of industrial development under the Thailand 4.0 regime, the kingdom will need construction professionals. If you are a Japanese Investor from the Construction Industry, there is a lot for you in Thailand. We will come up with more information on this in our next article.
The Bottomline
The developing Thailand-Japan relationship will definitely help you with a greater ease and privileges to start your business in Thailand. But yet, to properly setup and operate your business in Thailand, you must satisfy the following checklist:
- A thorough know-how of the Japan-Thailand Economic Partnership Agreement (JTEPA). Your perspective must focus on both on legal and immigration aspects relevant to your business idea;
- Understanding of Thai Civil and Commercial Law;
- Knowledge of the schemes and privileges of the Board of Investment of Thailand;
- Accounting and Taxation support as per Thai Accounting Standards;
- Payroll Management support according to the Thai Human Resource Regulations.
To get assistance in all of these mentioned points, you must have local Thai support. For services relevant to all of these, you can count on us. Before proceeding on your planned business in Thailand, take some time to connect with us for free consultation. You can email us your plan and the type of assistance you need from us at [email protected].
