“FUTURE IMPACT OF EEC ON /JOMTIEN” 23 March 2018 Projected GDP (PPP) ranking in 2050 การศึกษาของ PwC: โลกในปี The2050: เศรษฐกิจโลกจะเปลี่ยนแปลงไปอย่างไรStudy of PwC: World in 2050? GDP (PPP) in 2050

Thailandไทย Ranking

Year 2050 20th 20th 19th 4th th -5 20->25 ห +12 +9 +4 +3 24 Year 2016 32th 28th 8th 27th 25th Vietnam Philippines Indonesia Malaysia Thai 2 THAILAND stuck Low investment…..Low extension Decrease in competitive capability Stuck in New Normal GDP % Need more annual investment % to boost GDP to %

อRankันด ofับ Competitivenessความสามา duringรถใ น2015กา-2016รแข fromง่ ข ัน140 ( countries2015 -16) จาก 140 ประเทศ Thailand Singapore Malaysia Indonesia Philippines Technology ไทย สงิ คโปร์ มาเลเซยี อนิ โดนีเซยี ฟิลปิ ปินส์ ความพรอ้ มดา้ นเทคโนโลยี 58 5 47 85 68 นInnovationวตั กรรม 57 9 20 30 48 คEducationณุ ภาพกา รศกึ ษา 68 1 13 41 44 แถSourceบสเี ขยี วห ม: าWEFยถงึ อัน ดับทดี่ กี วา่ ประเทศไทย ทมี่ า WEF 3 Concept of Eastern Economic Corridor

4 Different Types of Special Economic Zones and its evolution

Free Zone SEZ

source : The World Bank Group 5 The growth of Special Economic Zones in the past 4 decades

Number of countries with SEZS Number of SEZs

source : The World Bank Group 6 Most of SEZs are located in Asia

Location of SEZs in 2005 Unit: %

source : The World Bank Group 7 The Models of proper SEZs depend on the policy context and country development purposes

Free Zone SEZ

source : The World Bank Group8 SEZs Incentives and Privileges

Tax Incentives Non - Tax Incentives • Exemption from import duties, excise tax • Land Ownership by foreign investors up to and VAT on machinery and raw materials 100% • Tax holiday period • Repatriate Profits • Tax reduction or exemption to bring • Foreign exchange control merchandise into Free Zone for assembling • Others: Loan access or manufacture

Benefits from Land Utilization Administration • Cheap long term lease-hold built factory • Ease of doing business • Basic infrastructure provided • Efficient flexible organization • Reasonable [price of ready build factory] • Clear accountability on job description • Others facilities : warehouse

source: The World Bank Group 9 Models and Concepts of SEZs in selectที่มา Countries: The World Bank Group Shanghai Pilot Free Trade Zone

Development from large scale SEZ to cross Develop and managed by private sector and driven border economic cooperation by the market Export promoted by the Free Market Shenzhen, Zhuhai, government Shantou and Xiamen economy Private sector are encouraged to develop Export-Oriented and operate Economy Economic and social Support export Developed from Free Zone SEZ to the development in the industry FDI development of Large Scale SEZ border areas Export Promotion

Instrument for regional development and competitiveness and regional leadership

Export-Oriented Economy Free Market – Orientation, Labor for US company Solve labour problems Border and FDI from US ISKANDA located in Johor bahru, the southern part of Malaysia = =Malaysia =India =Mexico =Philippines10 =China High Various =Malaysia High =India =Mexico =Philippines = =Lao Less Limit Less

=Cambodia Budget and Scope of Number of time for Promotion activities in development SEZs

Limit High source : The World Bank Group Limit High 11 “The Government determines to establish the EEC as the future gateway of Thailand”

General Prayuth Chan-o-cha Prime Minister 12 EEC: Putting Thailand 4.0 in Action via Area – based Development

Thailand 4.0 SMART TECHNOLOGY with SMART PEOPLE Match to the real demand and leave no one behind Eastern Economic Corridor:

Thailand’s Industrial Policies EEC Moving toward New Technology and Inclusive Growth EEC Chachengsao The First Area- Based Development •T4.0 in Action •Industrial Policies in Action

Bio Tech Health Tech Robotic Tech Culture/creativity

13 Why? Existing Industries and Infrastructures leading to EEC 14

2 Deep Seaport Industrial Estate and Map Ta Phut 100,000 Rai

1 Motorway Chachoengsao Leading Petro 8 Highway Chemical in AEC Chonburi 1 Double Track Railway The 13rd World leading Ladkrabang-Laem Chabang Automobile Production based 1 U-Tapao Airport Rayong Capacity : 3 Million passenger /year Tourism Pattaya Tourist 10 Million people 15 Why? What Thailand will get… New annual tax base 100,000 Million Baht invest 1.5 trillion baht in 5 years Create new tax base 100,000 M baht per year EEC is economic driving mechanism for from increasing GDP right investment Enhance Thai 'quality of life and environment to international standard + 10 million Tourists / Year Economic growth 5% yearly More foreigner tourists to U TA PAO airport Economic growth at least 5% yearly , Increase income more than 450,000 M Baht / Year compare with at present 3 % Reduce Logistic cost 400,000 M Baht/Year

100,000 New Job position per year Reduce Logistics Cost from 15% of GDP to Create new jobs both in industrial and 12% of GDP service sectors 16 Map of fundamental infrastructures ( At present – next 5 years )

17 18 Connectivity of EEC within Thailand and the World

East-West Economic Corridor Upper Part

1) Bangkok – – 2) TAK – Phitsanulok – Phetburi – Khonkhaen – Roi et - Mukdaharn East-West Economic Corridor Lower Part

1) Bangkok – Karnchanaburi 2) Bangkok – Cha Cheng Sao 3) Bangkok – Cha Cheng Sao – Laem Cha Bang

19 Major Infrastructure: Aerotropolis and High Speed Train , connect 3 Airports 3 Airports with High Speed Aerotropolis Train Donmuang

Chachongsao Suvannabhumi

Chonburi

Sriracha

Pattaya

Rayong • U ta pao has passenger capacity 15-30-60 Million in next 5 - 10 - 15 years utapao • Present value 150,000 Million Baht • Increase of high speed train income 40,000 Milllioon Baht 2020 Investment in 3 Major ports, Bangkok connect with dual track train ICD ladkrabang ศูนย์กลางโลจิสติกส์ท่ี and seamless operation ฉะเชิงเทรา Major industrial Chachengsao 1 Laem Cha Bang Port Phase 3 Estate Clusters 2 Map Tha Phut Industrial Port Phase 3 3 Satthahip Commercial Port Chonburi 4 Dual Track Train connect 3 Ports Rayong 5 Seamless Transportation Operation Major industrial Estate Clusters Tourism: upgrade to international quality

World Class Tourism Ring (Pattaya – Sattahip- Rayong) 1. Chachongsao , Green tourism City , Nature 2. World Class Tourism Ring (Pattaya – Sattahip- Rayong) 3. Pattaya– Pattaya Pier (No Pollutiion)- New Pattaya City 4. Pattaya – Huahin (Sattahip port - Pranburi) Ferry to BANGKOK- HUAHINN 5. Pattaya- Royong - Sihanuville

22 Public Private Partnership with Private Sector in EEC(PPP-EEC Track) To do faster, without reduce steps of work 8-10 month 6-8 month 7 month + 12-18 month

1.Project Preparation 2. Project Presentation 3. Private Sector Selection

PPT PPT Act.

3.5 month 4 month 1.5 month + 10.5 month Start bidding Contact Signing 2013

1.Project Preparation 2. Project Presentation 3. Private Sector Selection Comply with with Comply Start bidding Contact Signing

1.Project Preparation & 2. Private Sector Selection

Presentation

Start bidding Contact Signing EEC Track EEC

23 4 PPP Projects in EEC List and U Ta Pao Maintenance Repair and Overhaul (MRO) Center

DEC 2017 Mar 2018 JUN 2018 SEP 2018 DEC 2018 FEB 2019 START OPERATION

High Speed Train , REPORT Got Private SIGN Connect 3 Airports Sector CONTRACT 2023 A.D.

REPORT Got Private SIGN 2023 A.D. U Ta pao Airport Sector CONTRACT

REPORT MRO Got Private SIGN Sector 2021 A.D. CONTRACT

Map Tha Phut Port Got Private SIGN REPORT 2024 A.D. Phase 3 Sector CONTRACT

Laem Chabang Phase 3 REPORT Got Private SIGN Sector CONTRACT 2025 A.D.

Remarks: High Speed Train connecting 3 Airports will develop in 2 phases Phase1: from Donmuang airport to U-Ta pao airport – in order to facilitate the approval of EIA and reduce environment effect in Map Tha Phut I.E. Area Phase 2: The extension part from U-Ta pao airport to Rayong, Chantaburi and Trat province - urgent study about the direction of high speed train and design in the most valuable method 24 Investor Persuade

Promotion Keep Contact and Persuade Study the investment Already Measurement information Invested Finish

Already give investment promotion to 160 Projects in EEC Analyze project information Final Step of Negotiation Got with investor, will sign in investment investment contact in March promotion 2018 form BOI ,in hybrid *As of 23 Aug 2017 from BOI automotive

cooperate with MDES in order to persuade during set up promotion measurement for using investment in EEC Digital Park and will sign electrical vehicle of consumer cooperation document in September 2017 2525 Major Progress 1. Important Infrastructure Investment • U-ta-pao airport to be aviation center of the East (1 phase effective in 1 year/ TOR in 2017 + Fully Completed in 5 years ) • High Speed Eastern Train connect 3 Airports (TOR in 2017 + Fully Completed in 5 years ) • Develop 3 Deep Sea Port , connect with Dual Track Train and Seamless operation transportation • Laemchabang Port Phase 3 (TOR in 2018+ Fully Completed in 7 years ) • Map Tha Phut Industrial Port(TOR in 2018+ Fully Completed in 7 years ) • Sattahip Port (A plan finish, will start construction first step at the end of 2018 ) The projects are already approved from the The Eastern Economic Corridor Policy Committee. 2. Public Private Partnership Regulation (PPP) • Enforced • Enforced only important project… same steps but reduce work time 3. The persuade of investment in 10 high tech target industry • Request to BOI 14,200 Million Baht in first 5 months • Key Strategic company .. Aviation (TG-Airbus, Boeing, SAAB, Air Asia) .. Electric Automotive.. (Toyota, BMW, Nissan, Suzuki, FOMM..) .. Robot and Automation.. 12,000 Million Baht for BOI in this year .. E commerce.. Lazada/Alibaba .. Medical Center , Rehabilitation .. FIRM Group Fuji Film Kobe Medical research special zone • Use existing I.E. (and newly announced to be I.E.) and set a standard with readiness for long term investment , with no environment effect. • Set up the first One-Stop-Service at Laem Chabang I.E. and co-service wit BOI service center

4. Tourism • Ministry of Tourism already set up a plan and identified projects

5. Promotion Zone • Already announced 21 target industry promotion zones 27 6. The Improvement in Human , Knowledge and Technology… • The Ministry of Education inform National Council for Peace and Order (NCPO) for the approval of order to approve the curriculum , both short term and long term

7. Infrastructure, Town Development and Environment • Plumbing and Energy System- Plans are well prepared and most of their budget are approved • New Town are under planning by town plan sub committee , with the general director of department of public works and town & country planning act as a chairman.

8. Draft of EEC. Act B.C..... • National Legislature conclude the agreement on draft of EEC. ACT. On February 8, 2018

28 I-EA-T Roles in EEC YEAR 6-15 NEW AREA FOR FUTURE AREA FOR FUTURE DEVELOPMENT DEVELOPMENT 110,000 RAI 110,000 RAI 160,259 RAI YEAR 1-5 DIGITAN AND MEDICAL 3,000 RAI 16,259 RAI NEWLY DEVELOPED AREA16,259 RAI LOGISTICS 10,000 RAI AREA FOR BOI PROMOTING 10,000 RAI (Aerospace/Aviation/MRO) 500 RAI 50,259 RAI FOOD PROCESSING/AGRICULTURE BIO I.E. PREPARE TO DEVELOP 12,000 RAI TECH/BIO FUEL 11,500 RAI 34,000 RAI New Gen Automobile, Smart Electronic, Robotic 7,259 RAI AREA OF READY FOR Environmental Friendly Petrochemical 18,000 RAI AT PRESENT INVESTMENT I.E. 12,000 RAI EEC AREA OF OPERATED I.E. 100,000 RAI 100,000 RAI SUPPLY INDUSTRY AREA OF EEC INDUSTRY AREA OF EEC 30 FIRST S-CURVE The Future Prosperity in EEC Next generation automobile Smart electronics Food for future Agriculture & Biotechnology Affluent, Medicals & Wellness

Robot Aviation Logistics Biofuels & Biochemicals Medical Hub Digital

SPECIFIC INVESTMENT AREAS KOREA ZONE CHINA ZONE INNOVATION PARK Total Areas SMART PARK Year 1-5 : 50,259 Rai 31 Tear 6-15 : 110,000 Rai SCIENCE CITY Map Tha Phut Industriial Port (Phase 3) Total Area

( 400 acre) Total Area 1,000 Rai Phase 1 ) • Area ~ 550 Rai ( 220 acre) • Sediment Retention area ~ 450 Rai (180 acre) Phase 2

Study Area cover the area under circle of radius 10 km from Phase 3 project center 32 Grand Opening 27 July 2017 33 34 35 36 37 38 Operation Plan of Development and Promotion of Tourism in EEC Area

Objective: enhance the tourism in 3 provinces (Chachengsao,Chonburi,Rayong)to sustainable world class tourist destination, focus on High End and Health & Medical Tourism

Target : increase income from tourism in the area with slogan “B-Leisure Destination”- Harmony of Business and Leisure as a family destination The Roles and Direction of Tourism in EEC

Pattaya Satthahip and Royong : Target within 2021: a major travel circle extend to Chachengsao  Travellers in EEC increase to 46.72 million (increase 1.5 times) Cultural and natural tourist destination and extend to and income increase to 528,590 million Baht (increase 1.8 times) others via transportation and logistics infrastructure of  Develop the quality and quantity of tourist attraction. EEC Project  Upgrade tourist facility infrastructures and environmental Chachengsao: Thai Way of Life management Strength in the way of life in Bang pakong River Basin ,  Upgrade transportation infrastructures connecting tourist culture and agriculture Tourism attraction such as Chonburi: Modern of the east  Widen the road with bicycle lane, bridge, light rail in The mixture of modern and local style. 1 of 5 Mice City of Pattaya area, bicycle lane Thailand  Cruise Port and Ferry Port Rayong: Biz City  Set up the institution of tourism to develop the curriculum for enhance tourism staff capacity Hub of industrial estates and Business Areas  Set up security management in EEC with CCTV in famous tourist public areas. Concepts of Tourism Development:

1. Development of Tourist Attraction Build new man made attraction, upgrade environmental management, zoning, set up standard signage system and etc

2. Development of Infrastructure and Facilities Cruise port, transportation system from airport to city, high speed train connect 3 airport , upgrade Road No.331 and etc.

3. Development of Human Resource (Tourism) promote cooperation between government, private and community to set up a cirriculum for development by using Sattahip Model “ Learning with Working” 4. Enhance the confidence of tourists Upgrade the quality and security of tourism in EEC as a “Preferred Destination” , especially in Pattaya , and communicate to the targets

41 (Tentative) EEC Development and Tourism Promotion Operation Plan Total 53 Projects with approx. of 31,028.22 Million THB 1. Development of Tourist Attraction State Enterprise Thailand Fiscal Fiscal budget 2. Development of Infrastructure and Facilities Divided into 4 Plans : budget 7,678.22 350 Milltion THB 3. Development of Human Resource (Tourism) Million THB 4. Enhance the confidence of tourists PPP 23,000 Million THB Budget (Million THB) Projects 2017 2018 2019 2020 2021 Total Plan 1 (15 projects) 160 10,259.35 278.97 486.81 499.56 11,684.69 Development of Tourist Attraction Plan 2 (30 projects) 1,040 2,095.11 5,484.18 10,144 131.3 18,894.59 Development of Infrastructure and Facilities Plan 3 (2 projects) 0 60 120 48 18 246 Development of Human Resource - Tourism Plan 4 (6 projects) 100 84.94 8 5 5 202.94 Building confidence measure for tourists Total 1,300 12,499.40 5,891.15 10,683.81 653.86 31,028.2242 42 Proposed Results 600,000 508,590

1. 2. 400,000 50 47 285,572 30 200,000

0 0 Visitor (Million) Revenue (Million THB)

2017 2021 2017 2021 Number of visitors will increase from 30 million in 2017 to The revenue from tourism will increase from 285,572 million 47 million in 2021. baht in 2017 to 508,590 million baht in 2021. 3. Efficient transportation and logistics connectivity system links the tourist attractions within and between the 3 EEC provinces, enable tourists to travel freely and conveniently.

4. The quality and image of tourism industry in EEC will be improved. Tourism sentiment is high which boosts the economy locally and nationally.

5. Green tourism is promoting the ecological and friendly environment. 43 MOVE TO IEAT 4.0 Thank you