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The Eastern Economic Corridor (EEC): the New Special Economic Zone for Special Investment Opportunity

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The Eastern Economic Corridor (EEC): the New Special Economic Zone for Special Investment Opportunity Business Location for Austrian Investors 4 November 2020 Ms. Sonklin Ploymee Senior Executive Investment Advisor Thailand Board of Investment (BOI) Introduction to the Thailand Board of Investment Provides comprehensive Grants Investment information and advice on Incentives establishing operations in Thailand BOI is a government agency responsible for investment promotion and work under the Office of the Prime Minister Coordinates between Provides Business the foreign business Support Services h community and other for Investors public agencies 2 AGENDA 01 Why Thailand? BOI’s Incentives 02 and Facilitation 03 Eastern Economic Corridor 3 Location & Market Access 2nd Largest Economy Globally (USD 13.4 Trillion) 8th Largest Economy Globally (USD 2.7 Trillion) th 5 Largest Economy Globally • 5th Largest Economy Globally (USD 3.0 Trillion The Thai Market CLMVT ASEAN Economic Community Greater Asia Region • Population: 69 Million1 • 242 Million Consumers3 • 645 Million Consumers4 • 4.6 Billion Consumers5 • Middle Class Consumers: • Within 1,000 KM • 5th Largest Economy Globally • Within 5,000 KM 52 Million2 (USD 3.0 Trillion) • ASEAN FTA / ASEAN Connectivity 4 Source: 1,3World Bank (2019), 2Deloitte (2016), 4ASEAN (2018), 5World Meters (2019), ASEAN Key Figures 2019 The Reach of Thailand’s Current and Potential FTA Network FTAs/RTAs Already Entered Into Force Under Negotiation ASEAN Free Trade Area RCEP Thailand-India Free Trade Area - Signing targeted by the end of 2020 th Thailand-Australia Free Trade Agreement (TAFTA) - 8 summit held in August 2020 ASEAN–China Free Trade Area Thailand-Pakistan / Thailand-Turkey Thailand-New Zealand Closer Economic Partnership / Thailand-Sri Lanka Japan–Thailand Economic Partnership Agreement - Under negotiation ASEAN-Japan Comprehensive Economic Partnership ASEAN–Korea Free Trade Area Thailand-EU / Thailand-EFTA ASEAN-India Free Trade Area - Being planned for a negotiation restart ASEAN-Australia-New Zealand Free Trade Area Thailand-Peru Closer Economic Partnership Thailand-Chile Free Trade Agreement The ASEAN – Hong Kong, China Free Trade Agreement 5 Source: Department of Trade Negotiation Last Updated August 2020 Continuously Improving Competitiveness Global Index Year Score ASEAN Ranking Ranking Ease of Doing Business Index 2020 80.1 21 3 Global Competitiveness Ranking 4.0 2019 68.1 40 3 Logistics Performance Index Ranking 2018 3.41 32 2 IMD World Competitiveness Index 2019 - 25 3 IMD World Digital Competitiveness Ranking 2019 68.43 40 3 Global Talent Competitiveness Index 2019 53.84 43 4 Global Innovation Index 2019 38.63 43 4 Inclusive Development Index * 2018 4.24 17 2 6 Note: * Ranking in Emerging Economies Group Source: World Bank, IMD Business School, INSEAD, World Intellectual Property Organization and World Economic Forum Thailand’s Performance in Handling the Pandemic is Exemplar of its Healthcare System. GHS Score 73.2 6th in Global 1st in Asia 1st among Upper-middle Income Countries Score & Rank by Category 7 Source: Johns Hopkins Center for Health Security Thailand as the 2nd Home of European Companies Across Sectors. Automotive Auto Parts Chemical Oil & Gas Bio-Based Smart Electronics 8 AGENDA 01 Why Thailand? BOI’s Incentives 02 and Facilitation 03 Eastern Economic Corridor 9 BOI Offers Investors Highly Competitive Investment Tax Incentives and Non-tax Incentives Tax Incentives Non-Tax Incentives • Exemptions / Reductions of Corporate Income • Permit for Foreign National to Enter Tax Kingdom to Study Investment Opportunities • Exemptions / Reductions of Import Duties on • Permit to bring in Skilled Workers and Machinery Experts to Work in Investment Promoted Activities • Reduction of Import Duties on Raw Materials • Permission to Own Land • Exemption of Import Duties on R&D Materials • Permit to Remit Money Abroad in Foreign • Double Deduction on Cost of Transportation, Currency Electricity and Water • No Local Content Requirement • 25% Deduction on Installation or Construction of Facilities • No Export Requirements • Exemption of Import Duty on Raw Materials • No Restriction on Foreign Currency 10 Used in Production for Export • Visa Facilitation Investors can Gain a Variety of Incentives Based on Activity, Technology, Merit, or Area Invested. Standard Incentives Additional Incentives Activity-Based Merit-Based • Research & Development (R&D) • Support academic / research institutes, or technology and human resource development fund • IP licensing fee < 8 years CIT exemption • Advanced technology training • Development of local suppliers Technology-Based • Product and packaging design - Targeted Core Technologies - Area-Based • EEC 3 provinces • SEZ 10 provinces • Southern border provinces 20 provinces with lowest Bio- Digital Nano- Advanced Material income Technology Technology Technology Technology • Industrial Estates/Zones 10 years CIT exemption • Science and Technology Parks (TSP, Food Innopolis, Space Krenovation Park) 11 Companies Participating in Human Resource Development Program Can Obtain Additional Business Incentives. Several human resource development program that are conducted in cooperation between investors and public agencies. Work-integrated Learning (WiL) Special Vocational Training Automation and Robotics Programs Program in EEC (SVT) at The Institute of Field Robotics Cooperative Education (CE) Higher Education for Industry Automation and Robotics Programs Consortium (Hi-Fi Consortium) at The Centre of Robotic Excellence Cooperative and Work Integrated Education (CWIE) Total Innovation Management Skill Development Training Program Enterprise (TIME) Dual Vocational Training (DVT) Electrical and Computer Thailand Center of Excellence Engineering Programs Talent Mobility Program (TM) for Life Sciences (TCELS) 12 Investors will Gain Standard Product-Based Incentive Packages, Depending on Level of Technology, Role in Supply Chain, and Location. Exemption Exemption Exemption Non-tax CIT Import duties Import duties incentives on machinery on raw materials Knowledge-based activities focusing on 8 A1 R&D and design to enhance the country’s + Merit years competitiveness years8 no cap Infrastructure activities for the country’s development, activities using technology to A2 create value-added, with no or very existing 8+ Merit investments in Thailand years High technology activities which are important A3 to the development of the country, with a few + Merit investments already existing in Thailand years5 Activities with lower technology than A1- A4 A3 but which add value to domestic + Merit resources and strengthen the supply chain years3 CIT exemption CIT Supporting industry that does not use high B1 technology, but is still important to the + Merit value chain years- Supporting industry that does not use high B2 technology, but is still important to the 0 value chain - - year years 13 BOI Will Aid in Every Step of the Way. One Start One Stop Investment VISA & Work Permit BOI Facilitation BOI Center (OSOS) SMART VISA Initiatives E-Services 14 One Start One Stop Investment Center (OSOS) More Convenience, Less Time, More Efficiency! Consolidating staff from Easing & speeding procedures numerous investment for new investors -related agencies Provides comprehensive Provides useful contacts information and advice with key public and on establishing 18th Floor, Chamchuri Square private organizations operation in Thailand Building, 319 Phayathai Road, Pathumwan Bangkok 10330, Thailand Tel: 66(0)2 209 1100 1-Stop for visas & work Assist investors with Fax: 66(0)2 209 1199 permits In 3 hours various applications Email: [email protected] 15 SMART VISA: Taking Thailand to New Heights with Foreign Talent and Technology Privileges for SMART Visa Maximum 4 years Visa Permission to No re-entry Fast Track Service at *Except Smart S work with no required International Airports work permits required 16 Investment Applications can be Submitted More Conveniently through the Completely Online “E-Investment Promotion” Portal. Submission of new investment application Users can submit their investment promotion application entirely online. Track investment application Keep updated with the status of ongoing application Management company/investment info Users can update the company and the investment information online, e.g. change of location, shareholder ration, registered capital 17 AGENDA 01 Why Thailand? BOI’s Incentives 02 and Facilitation 03 Eastern Economic Corridor 18 The Eastern Economic Corridor (EEC): The New Special Economic Zone for Special Investment Opportunity Thailand’s flagship Special Economic Zone (SEZ) to accelerate future growth of the region Strength of the leading industries: • Chachoengsao Automobile & parts, Petro chemicals, Electrical Appliances • Chonburi • Rayong Springboard location to ASEAN, China, and India: via Multi-Modal linkages and Free Trade Areas (FTAs) 19 Source: Thailand’s Eastern Economic Corridor (EEC) Guidebook, Board of Investment Special Incentive Packages for Investment in Targeted Activities and Targeted Locations in the EEC Area Targeted Locations: Investment projects must be located in Chachoengsao, Chonburi or Rayong. CHACHOENGSAO Targeted Activities: • New incentives target investment projects that qualify for at least 5-year tax holidays (i.e. Group A1, A2, A3 ), CHONBURI including Technology and Innovation Development activities under Section 8. • Does not apply to activities that have no specific location or those required to be located in areas outside EEC. RAYONG Application Periods: • Projects located in the EEC
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