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 Home > About Thailand > Manufacturing > Selected Sector Investment Opportunities

Selected Sector Investment opportunities

| Electronicsi | Automotive Industry | Engineering Plastics & Synthetic Fibres| The Chemical Industry | Environmental Markets | Metal-Working & Machine Tools | Telecommunications | Supporting Industries | Agro-Industry-The Potential for Biotechnology |


Thailand's electronics industry has made major strides in the past decade and now produce many types of electronics equipment, subassemblies and components. The electronics industry has played an increasingly important role in the manufacturing sector, particularly with product manufactured for export. Among the leading industrial and professional electronics products are hard disk drives for computer, keyboards and telephones. Thailand also has become a major manufacturing and assembly base for a number of electronic and related components, including integrated circuits, printed circuit boards, miniature ball bearings, computer cards and cables. During the rapid economic growth of 1986-1994, higher value-added and higher technology products such as facsimiles and cellular telephones began to be produced. Firms that manufactured components for export gradually started supplying parts Dan components to be assembled into export products.

Some of the most promising investment opportunities in Thailand's electronics industry are in the areas of consumer electronics, computers and peripherals, communication equipment, electronic assemblies, and supporting industries such as molds and dies, metal plating, transformer winding.

Automotive Industry

Thailand's automotive industry has performed spectacularly since 1988, tripling production from 145,000 units to almost a half a million units in 1993. Production is projected to reach 1 million units by 2,000. The kingdom is currently Southeast Asia's largest and most dynamic auto market and the world's second largest pickup market.

Thailand is well positioned to join the small global group of automotive "tigers," whose performance places them a notch below the automotive giants (Japan, North America and Europe), but well ahead of other developing countries.

Thailand initiated its diversification drive in 1991 by allowing competition from imports for the first time in 20 years. In 1992 alone Thailand imported 22,000 vehicles or 20 percent of the passenger car segment. Under pressure from imports, domestic producers cut prices by up to 25 percent, with the result being more people can afford cars, government revenues are up and Thailand's industry is now more productive. Further diversification through import duty reductions are in the offing.

A second tool fro diversification in promotion of new vehicle assembly operations. The Board of Investment has re-opened promotion privileges to auto-motive assembly projects for export, aiming to make Thailand a regional automotive production centre. This is encouraging North American, Korean, and European firms to enter a market that has been near-exclusively owned by Japanese manufacturers.

Thailand effectively implemented local content requirements in the 1980s and 1990s to achieve basic component assembly and delivery capabilities. In its quest to enhance its global competitiveness, Thailand is now making industrial deepening a priority as it courts new investments in components and supporting industries. Established automakers are expanding their investments and setting up supply lines within the country; this is considered a strong indication of the profitability of such operations.

Industrial deepening will transform the automotive assembly industries into pillars of the economy, which will integrate raw steel into metal-bending into finished body panels. Ventures which promise additional value-added work in Thailand are favoured.

Thailand's auto industry means to get globally competitive. Look for Thailand to pursue market diversification Dan industrial deepening to achieve competitive targets in 2000. Well-managed, progressive foreign companies should seize ensuing opportunities and take their share of Asia's fastest growing automotive market.

Engineering Plastics and Synthetic Fibers

Engineering plastics, with their superior properties, are finding increasing uses in applications demanding higher performance than commodity plastics. Engineering plastics include polyacetal nylon, polycarbonate, and thermoplastic polyester molding compounds. Now only nylon is produced in Thailand mainly for the synthetic fibre industry. Thailand has been exporting an ever larger part of its synthetic fibre production.

Engineering plastics have seen excellent growth over the past few years and the Board of Investment announced in April 1994 that it will begin granting special investment incentives for the production of engineering plastics as part of its strategy to encourage growth in Thailand's supporting industries.

Investment opportunities for engineering plastics include polyacetal, nylon, PET, and PBT. Production of these compounds is promoted by the BOI. The growing demand for PBT at around 1,500 to 2,000 tons a year is a possible investment opportunity.

The expansion of production facilities for the three main synthetic fibres (polyester, nylon and acrylic) for domestic and export markets is being met by new investments. New investment opportunities will depend entirely on the export market and it is expected that foreign investment will play an important role in this development.

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