THE THAI Chamber of Commerce (TCC) says it is confident that the Eastern Economic Corridor (EEC) will drive the economy forward and expects government outlays of at least Bt1.5 trillion from 2018-22 to spur investments in the development zone by domestic and foreign companies.
Kalin Sarasin, chairman of the TCC and the Board of Trade of Thailand, said: “The TCC expects about Bt300 billion will be invested in the EEC annually for five years. That, combined with private investment in the area, should contribute an increase of about 1-1.5 per cent per year towards Thailand’s expansion in gross domestic product.”
A number of foreign investors, such as global online trader Alibaba, European aircraft manufacturer Airbus and US aircraft manufacturer Boeing, have announced investment plans for the EEC.
For Thailand to escape from the so-called middle-income trap and see per capital income of US$15,000 a year, new economic drivers – including the EEC development – will be the key to strengthening the country's industrial base, said Kalin, adding that these drivers included the advanced S-Curve industries that are being targeted for the EEC.
The TCC is joining with the University for Thai Chamber of Commerce to develop an academic curriculum for the personnel needed to manage the EEC’s future expansion, he said.
After a visit by a Japanese delegation of 570 companies to Thailand last week, Soji Sakai, chairman of the Japanese Chamber of Commerce (JCC) in Bangkok, said the Thai government provided useful information on the EEC and its investment details for its flagship development zone.
A recent JCC survey found that about 40 per cent of its member firms were interested in investing in the EEC, he said.
If some big projects, including those for high-speed trains, are firmed up, this would help Japanese companies in their decision-making, Sakai said.
Japan remains the biggest foreign investor in Thailand, accounting for about 40 per cent of foreign direct investment in the country. It is Thailand's second-largest trade partner, after China.
“The most important thing is that we should not only wait for foreign direct investment, but also have Thai investors to be ready for joint investment in related supply chains and follow the government's mega-investment strategies for increased competitiveness,” Kalin said.
More foreign investors have been persuaded to invest in the EEC zone, while the Thai private sector has been pushed to increase its investments there, he said.
The TCC’s business networks have been mobilised to help develop the EEC project.
The business chamber is confident that the government’s efforts to steer the country towards the Thailand 4.0 development goals will mark a turning point in the adoption of higher technology and innovation for the manufacturing and services sectors, Kalin said.
New business operators will be allowed to make self adjustments to manage the changes, he said, and existing operators must remain under the concept of “Leave no one behind”.
For tourism, another key economic driver, the country should aim to be become a “B-leisure destination”, he said, under a model that combines business and modern tourism services in cities in EEC, he said. This would also improve the economy.
Tourism in the provinces covered by the EEC will extend from man-made tourism sites and the holding of conferences that promote connectivity with other regions and with other Asean countries.
Man-made tourism development includes the Pattaya on Pier project, which will open for private sector participation under the public-private partnership (PPP) model.
However, the Thai private sector remains concerned about the available of skilled labour for manufacturing and services venture in the EEC.
Early this month, the JCC urged the government to improve Thailand’s infrastructure, human resources development and the determination of Board of Investment's investment promotional policy.
These three issues were important for the prospects of the new industries envisaged in the EEC, Soji Sakai, president of Japanese Chamber of Commerce in Bangkok said.
Regulations for PPPs, which involves the sharing of risks between the public and private sectors, will need to be improved, he said. Systems will also need to be upgraded to help new businesses and some rules relaxed.
Better transport linkages with Thailand’s neighbours will be required to help upgrade local industries, he said, adding that the JCC would have discussions with state agencies on these matters.