Thailand: Eastern Economic Corridor investment

Author: | Published: 16 Jul 2018
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Chandler MHM Ltd

Address

Bubhajit Building, 7th - 9th Floors
20 North Sathorn Road
Bangkok 10500
Thailand

Telephone

+662 266 6485

Fax

+662 266 6483

The eastern seaboard of Thailand has attracted substantial investment during the past 30 years, including into the petrochemicals, auto assembly and high-tech business sectors. The area is served by three airports and two deep-water ports. Both Thai and foreign companies have obtained investment incentives from the board of investment (BOI) under the Investment Promotion Act (1977).

During 2017, there were three Orders of the National Council for Peace and Order to establish eastern special development zones (ESDZ), which drove early steps towards establishing such zones. To date, 24 ESDZs have been announced.

Six major eastern economic corridor (EEC) public-private partnership (PPP) projects are also in progress:

  • the U-Tapao International Airport and Eastern Aerotropolis;
  • high-speed trains connecting three airports;
  • the development of Map Ta Phut Port Phase 3;
  • the development of Laem Chabang Port 3;
  • the U-Tapao Maintenance, Repair and Overhaul Centre (MRO Centre); and,
  • innovation and digital parks.

The Eastern Special Development Zone Act BE 2561 (2018) (EEC Act) was published on May 14 2018. It applies in three eastern provinces: Rayong, Chonburi and Chachoengsao (and any other area in the eastern part of Thailand to be prescribed in the Royal Decree to be announced, as special development zones), and prescribes a number of incentives for private investment. It complements and builds upon the BOI's regime. It repeals the three Orders mentioned above.

Certain parts of the EEC area have been designated as special economic promotion zones (SEZ) within which 10 target industries will enjoy additional privileges. These 10 target industries include:

  • next-generation automotive;
  • smart electronics;
  • medical and wellness tourism;
  • agriculture and biotechnology;
  • food processing;
  • robotics;
  • aviation and logistics;
  • biofuels and biochemicals;
  • digital services; and,
  • intensive medical and wellness hubs.

The additional privileges include: the exemption from or reduction of taxes; the right to bring in foreign experts in certain fields; a 50-year land lease, with the right to renew for up to 49 years; the right to own land and condominiums for the purpose of the business; exemptions from exchange control regulations; and, exemptions from customs law compliance.

A one-stop service to facilitate the issuance of permits and licences under a large number of laws will be established to facilitate the start-up of business in the SEZs (sections 29 to 38 and 43 to 46).

The EEC office is located at: 5th Floor Industrial Estate Authority of Thailand, 618 Nikhom Makkasan Road, Bangkok.

Applications for investment in the EEC should be made through the BOI. See the BOI's website, in particular the following titles:

  • promotional investment procedure;
  • online request approval for promotional investment (E-BOI application); and,
  • contract channels for investing in the targeted industries.
Albert T. Chandler Foifa Tharaphan Sawanee Gulthawatvichai