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Ms. Ajarin PattanapanchaiDeputy Secretary General

Thailand Board of Investment

Thailand: Growing Opportunities

Region: Southeast AsiaPopulation: 65 million Area Total: 514,000 km2

Coast Line: 3,219 kmCapital: BangkokReligions: Buddhism 95%GDP per capita (2008) :GDP per capita (2008) : $4,080 Agriculture: 11% Manufacturing: 45% Services: 44%

Thailand in GeneralThailand in General

Thailand’s Global Economic Rankings

Source: The Economist’s Pocket World in Figures, 2010

•33rd biggest economy•31st biggest exporter•31st biggest earner from services and income•23rd largest surpluses•18th largest manufacturing output•36th largest services output•16th largest air travel•17th most tourist arrivals

Strong Economics Fundamental

Economic Projections

2008 2009 2010

1) GDP growth (y-o-y)

2.5%

-2.3%

7-7.5%

2) Export growth, FOB value (y-o-y)

15.9%

-13.9

%

24.5-27.5%

3) Import growth, CIF value (y-o-y)

26.5%

-24.9

%

34.0-37.0%

4) Trade account (billion US. dollar)

0.1 19.411.0-14.0

5) Current account (billion US. dollar)

1.6 20.911.0-14.0

6) Inflation (billion US. dollar)

5.5%

-0.9 3.0-3.5

Source: Bank of Thailand July Inflation Report, as of July 28, 2010

Items 20092010

(Jan-Jul)Growth

(%)

Computer and parts 16.02 10.78 32.3

Motor cars, parts, accessories 11.12 9.95 81.7 Precious stones and jewelry 9.76 6.34 11.5 Integrated circuits 6.44 4.51 37.5 Rubber 4.31 4.18 106.4 Refine fuels 5.43 3.73 40.0 Rubber products 4.49 3.55 52.5 Plastics resin 4.46 3.42 41.0 Chemical products 4.47 3.15 33.1 Iron, steel and their products 4.95 2.90 6.3 Others 80.98 56.13 27.9Total 152.43 108.63 34.1

Top 10 Exports in 2007 – 2010 (Jan-Jul)

Source: MOC, as of Aug 25, 10

Unit: US$ Billion

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1 Singapore 11 Japan

2 New Zealand 12 Thailand3 United States 23 Korea4 Hong Kong 25 Malaysia5 Denmark 47 Taiwan6 United Kingdom 93 China

7 Canada 104 Vietnam8 Australia 126 Philippines9 Norway 135 Indonesia10 Ireland 159 Laos PDR

Source: World Bank Study: Doing Business in 2010

CriteriaStarting a business

Hiring and firing workers

Enforcing contracts

Access to credit

Closing a business

Registering property

Dealing with licenses

Paying taxes

Trading across borders

Investor protection

Top 20 World Bank’s Ease of Doing Business

Consistent Improvement inInvestment Environment

Thailand Ranks: World Bank Ease of Doing Business

2018

1513 12

2005 2006 2007 2008 2009

Grant Thornton’s 2010 emerging markets opportunity index“Three major benefits that investors will gain when investing in Thailand are incentives, a low cost of labor and land and low levels of security threats for foreign investors”

HSBC : Thailand ranked as 3rd best country for an expatriate stand of living

Political Economic Risk Consultancy (PERC): survey of 1,373 senior expat executives within 12 countries on bureaucracies in Asia, Thailand is ranked 3rd, in term of bureaucratic efficiency

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Infrastructure- TransportationInfrastructure- Transportation

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TransportationTransportation National highwayNational highway system: 64,000 km. connecting

all 76 provinces : Expanding connections into Cambodia, Laos, Vietnam and southern China

7 international airports : 7 international airports : ttotal capacity to support 8,500 arrival and 9,300 departure passengers per hour

Rail system:Rail system: 4,346 km. linking to Malaysia & Singapore

Bangkok Mass TransitBangkok Mass Transit : Sky train and Subway -Expansion plan for 137 km. during 2006-2012

STATE-OF-THE-ART INFRASTRUCTURESTATE-OF-THE-ART INFRASTRUCTURE

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Shipping 6 deep sea ports and 2 international river portsIncluding container, tank farms and liquid jettiesAutomotivese-Customs facilities• Laem Chabang Port :

– 7 container terminals with TEU 7.4 million exist capacity, expansion to TEU 10.8 million in 2011

– 3 Auto Yard with 3 Auto Yard with 2.9 million vehicles per year capacity

INFRASTRUCTURE INFRASTRUCTURE

GMS GMS InfrastructuInfrastructu

rereDevelopmenDevelopmen

tt

Source: NESDB as of Jan 20,2009

North-South Corridor North-Eastern Corridor

East-West Corridor

Southern Corridor

Central Corridor

Southern Coastal Corridor

Free Trade Agreement

Entered into force AFTA* ASEAN-China ASEAN-Japan ASEAN-India ASEAN-S.Korea ASEAN-Australia-NZ Thailand-Australia Thailand-NZ Thailand-India Thailand-Japan

Source: BOI International Affairs & www.thaifta.com, as of Feb 05, 2010

Note: * Thailand, Malaysia, Indonesia, the Philippines, Singapore and Brunei only.

Strategic Location and Expanding Network of FTAs

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Investment Promotion Policy

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No restrictions on foreign currency remittances

No export requirement

No foreign equity restrictions in manufacturing

sectors and promoted services sector

No local content requirement

Liberal Investment Policy

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Tax Incentives Corporate income tax

holidays up to 8 yrsAdditional 50% reductions of corporate income tax for 5 yrs may apply in zone 3

Import duty reductions or exemptions on machinery and raw materials

Double deduction of public utility costs

Deductions for infrastructure construction/installation costs

Non-Tax Incentives Land ownership

rights for foreign investors

Permission to bring in foreign experts and technicians

Work permit/visa facilitationOne-Stop-Shop Visas & Work Permits are issued in 3 hours3 hours

Basic BOI privileges and Measures

Labour Labour DrivenDriven

LabourLabourDrivenDriven 198198

00

InvestmentInvestmentDrivenDriven19921992

ProductivityProductivityDrivenDriven since 2003 since 2003

Knowledge & Knowledge & Technology Technology DrivenDriven

Development of Thai Industry

1970197019701970

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Investment Opportunities in Major Sectors

Thailand: World’s Leader in Agro-Based Products World’s No.1 producer of natural rubber, riceWorld’s top exporter of cassava & tapioca, sugar, frozen

seafood, canned tuna, canned pineapples, and chicken meat

Source: MOC, as of 29 January 2009

Major Agricultural WasteSugar CaneTops and leaves,Bagasse > 25.4

mil. tons/yr

Oil Palm

Fiber, Shell, Bunches > 0.3 mil. tons/yr

TapiocaSlurry, Rhizome> 1.4 mil. tons/yr

RiceHusk, Rice Straw > 27 mil. tons/yr

Solar Biogas Wind Biomass

Garbage Water Bio Diesel Ethanol

National Policy to Promote Renewable EnergyTarget : To increase share of renewable energy to

8% by the year 2011 and 20% by 2022

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• Largest auto producer in Southeast Asia, 14 largest producer in the world, target to be top ten in next 4 years

• World’s 2nd largest producer and market of pickup trucks.

• 16 assemblers: production forecast for 2010~ 1.6 mil. units 55% exports

Thailand: Auto Hub of Asia

• Strong Supporting Industry ~ 2,300 suppliers of Tier 1, 2 ,3 with combination of multinational, JV and domestics enterprises

• High Local content : 80-90% for pick up and 30-70% for passenger car

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Electronics and Electrical Industry

Source:*E&E Intelligence Unit, as of Feb 12, 09Source:*E&E Intelligence Unit, as of Feb 12, 09

• Thailand is the 13th Export Rank

• E&E exports 1/3 of total export value

• Thailand is the world’s largest producer of HDDs

• A leading country in the manufacture of Integrated Circuits and White Goods (refrigerator, air-conditioning)

• Strong supporting industries for electrical appliances

Compressors, motors, plastic and metal parts

Many opportunities exist in this growing sector:R&D and designPrintingTourism facilitiesFilm & EntertainmentRegional Operating HeadquartersBusiness Process OutsourcingLogistics

Services: The Land of Smiles at Your Service

World class hospital services, high-quality medical treatment with Thai hospitality

Health tourism increased over 200% in last few years, becoming the largest in Asia

Statistic of foreign patients 2003 ~ 970,000

2004 ~ 1,100,000 2005 ~ 1,280,000

2006 ~ 1,300,000 2007 ~ 1,500,000 2008 ~ 2,000,000

Thailand: Regional Medical Hub

Regional Operating Headquarter Incentives if you provide services to companies outside of Thailand

• Business management, admin.• Sourcing raw materials, parts, finished products• Research & development• Technical assistance• Marketing and sales promotion• Human resources training• Business advisory services• Investment feasibility studies• Credit management• Other services approved by the Revenue Department on a

case-by-case basis

For portion of income from LOCAL OPERATIONS

10% CORPORATE INCOME TAX

for 15 years

Benefit

- In 1st fiscal year, have one operating company in another country; a second within 3rd year; a third within 5th year

- Have annual expenses in Thailand of Baht 15 million, or have invested at least Baht 30 million in Thailand

- By end of 3rd year, 75% of ROH personnel to be qualified staff, have 5 specialised professionals, and 5 top executives earning at least Baht 2.5 million in annual salary and benefits each

- Must have registered capital over 10 million baht

For portion of income from OVERSEAS OPERATIONS

0% CORPORATE INCOME TAX

for 15 years

Key Conditions

Benefit

TOPLINE OF BENEFITS & CONDITIONS FOR REGIONAL OPERATING HEADQUARTERS

Benefit

In addition to conditions for income from overseas and

local operations:

- Corporate Income generated from services to overseas companies must be at least 50% of total revenues

- Personal income paid from overseas office is exempt

For income of EXPATRIATE EMPLOYEES

15% PERSONAL INCOME TAX

for 8 years

Key Conditions

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BOI Investment ServicesBOI is a Full Service Investment Center

We provide comprehensive information on opportunities in Thailand

Industrial Subcontracting assistance (BUILD)Free sourcing assistance to your specificationsInternational standards

Investment Facilitation UnitWe assist you with other government agenciesEven with your utility connections

• Thailand’s first comprehensive investment center • Opens on November 23, 2009• Objectives

• Facilitate entry of new investors• Assist businesses looking to expand• Serve as a focal point for dealing with 21

relevant government agencies• Who can use services: Open to all businessmen

• Big and small• Domestic or foreign• BOI-promoted or not

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