Thailand: Japan’s top investment destination and key partner for social and economic development in the ASEAN region

H.E. Kazuya Nashida, Ambassador Extraordinary and Plenipotentiary of Japan to the Kingdom of Thailand and business leaders share their insights with Bridges on Thailand-Japan relations.

“Japan is Thailand’s largest foreign direct investor with a stock base of 93.5 billion US dollars in investments, representing 33 percent of the total foreign direct investments into Thailand. Japanese companies are present in almost every business sector in Thailand and produce 10 percent of the country’s GDP.”

“Thailand’s key industries; automotive, metal manufacturing and processing and electronics play an important role in Japanese companies’ global supply chain.”

“There are 6,000 Japanese companies active in Thailand. Surprisingly, in recent months an additional 400 Japanese companies established operations despite the pandemic. Today, the member companies of the Japanese Chamber of Commerce in Thailand employ 85,000 people.”

“Since the Japan-Thailand Economic Partnership Agreement came into effect in 2007. Driven by the trade of food and agricultural products, the number of Japanese companies in Thailand increased by 1.5 times with trade volume increasing by 1.2 times.”

“The Regional Comprehensive Economic Partnership covers many important issues that will help increase trade and create a more transparent investment environment.”

“The success of the ‘Thailand 4.0’ initiative, increased connectivity in the ‘Eastern Economic Corridor and Thailand’s shift towards the ‘Bio-Circular-Green’ economic model will all be highly-dependent on foreign capital and investment.”

“Our Embassy’s economic section has been organizing business-matching events for the last five years to bring together young Japanese entrepreneurs, Japanese companies active in Thailand and Thai-based conglomerates.”

“There are two Japanese Kosen schools in Bangkok to nurture young engineers and equip Thai youths with the technical skills necessary to contribute to tomorrow’s economy. An estimated 1,100 students are expected to graduate by 2034 and we are in discussions on how we can expand these programs.”

Thai people really love Japan, Japanese food and culture. We hope both of our countries overcome the current situation and resume people-to-people exchanges to help businesses, the economy and our bilateral relationship.

H.E. Kazuya Nashida, Ambassador Extraordinary and Plenipotentiary of Japan to the Kingdom of Thailand

“The number of Japanese restaurants in Thailand grew by 12 percent last year and today there are over 4,000 Japanese and Sushi restaurants across the country.”

“Thai people really love Japan, Japanese food and culture. We hope both of our countries overcome the current situation and resume people-to-people exchanges to help businesses, the economy and our bilateral relationship.”

“Energy efficiency technology is a strength of many Japanese companies. They are able to offer companies good advice on how to improve energy efficiency. Today, Japanese companies are teaming up with Thai companies to contribute to the development of smart cities in Thailand.

“Looking at the data coming from Japanese companies in Thailand, the investment climate is beginning to improve.

“Japan’s experiences and capabilities allow companies to focus on smart energy, not only for applications in the manufacturing sector such as the automotive industry, but across all sectors including food and services.” — Atsushi Taketani, President, JETRO Bangkok Office

“JCC Bangkok is one of the largest Japanese chambers of commerce abroad with more than 1,700 member companies in Thailand. We provide business opportunities and disseminate pertinent information to our member companies and together with them we conduct social contribution activities for Thai society.

“Our 15 key industry subcommittees and 22 cross-industry committee members regularly gather to exchange information, share opinions and discuss various industry and advocacy concerns. In compliance with the Thai government’s infection prevention initiatives, many of our events were cancelled, scaled down or held online during the pandemic. We cooperated with various related organizations and provided information to our member companies through our website and by email.

“The Japan Job Fair which we conduct every year to help secure Human Resources from across Thailand was held on a much smaller scale however we continue to provide scholarships to local students and support educational facilities.

“We collaborate with the other economic organizations in Thailand and aim to expand business opportunities for Japanese companies. The Thailand 4.0 initiative has attracted foreign investors, including leading Japanese companies and focuses on IOT, AI, Robotics, Bio and Medical Technologies. The initiative has also spurred business activities for our member companies which are active in these industries.” — Nobuyuki Ishii, Executive Managing Director, Japanese Chamber of Commerce, Bangkok

“To be a regional trade and investment hub of ASEAN in the future, Thailand needs to reform laws and regulations to facilitate ease of doing business, create a favorable business environment, as well as promoting foreign investment in the Eastern Economic Corridor (EEC) including adoption of Bio-Circular-Green Economic Model (BCG) to drive Thai economy.

“In addition, Thailand National Digital Trade Platform (NDTP) will enable Thai entrepreneurs to connect with global trade and expand more opportunity to access global market and digital information.

“Thailand is ready for business in the disruption age.” — Sanan Angubokul, Chairman of the Thai Chamber of Commerce and Board of Trade Thailand

“The Japan Bank for International Cooperation (JBIC) has been conducting the ‘Survey Report on Overseas Business Operations by Japanese Manufacturing Companies’ since 1989.

“The Survey aims to better understand the current situation, challenges and outlook for Japanese manufacturing companies with overseas business developments and a track record in overseas business operations. 

“In the latest survey released last January, Japanese companies listed Thailand as one of top five countries considered to have promising prospects for business operations over the next three years. The other countries were China, India, Vietnam and the US.

“In the late 1980’s and the middle of 1990’s, Japanese companies started to shift from exporting to Thailand to setting up production and marketing bases in the country. The strong industrial base, especially for the automotive sector and Thailand’s strategic geographical location made it an ideal export hub for Japanese companies reaching out to ASEAN member countries and the Mekong region.

“When looking at major infrastructure projects funded by Japanese investment and cooperation, the power sector is one of the most active ones so far.

“In 2019, JBIC signed an agreement to provide financing of up to USD208 million for the 2500MW Gulf PD Natural Gas-Fired Combined Cycle Power Plant Project in Thailand.

“This was part of JBIC’s Global Facility to Promote Quality Infrastructure Investment for Environmental Preservation and Sustainable Growth.

“The total loan of USD1,366 million is co-financed by the Asian Development Bank, the Export-Import Bank of Thailand, Mizuho Bank, Ltd., Sumitomo Mitsui Banking Corporation, Sumitomo Mitsui Trust Bank, Ltd., DZ Bank AG, and Oversea-Chinese Banking Corporation Ltd., in addition to other regional banks in Thailand.

“Thai government projects the annual demand for electricity in Thailand will grow by 3.1% by 2037.

“This is considered to be a part of the major base load that will supply the necessary energy for the ‘Thailand 4.0’ initiative and the Eastern Economic Corridor Plan. The project will ensure a stable supply of electricity to Japanese firms operating in Thailand allowing them to continue expanding their overseas economic activities in the region.

“We are in constant discussions with several local Thai banks to seek the possibility of supporting Thai and Japanese companies working in Thailand and ‘third countries’ across the region.

“The purchasing power of the Thai population is one of the highest in Southeast Asia and many Japanese companies continue to prosper in Thailand.” — Takahiro Kuchiki, Chief Representative, JBIC

We are assisting international scientific exchange between Japan, Thailand and other countries in the region such as the Philippines, Indonesia, Malaysia and Bangladesh. Interestingly, we often hear that Thai students are very studious and disciplined.

— Yoshio Otani, Ph.D., Director, JSPS Bangkok Office

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