Looking to buy Thailand real estate or Thailand property investments that are worth the price? Then you better set your sights on Thailand’s SEZs, the future leading economic drivers of the country.
What are Thailand’s Special Economic Zones?
Special economic zones are basically areas which have special business and trade regulations that are aimed at bettering the country’s economy.
The first five special economic zones (SEZ) in Thailand were introduced in 2014. Another five were implemented in 2016. These SEZs are strategically located in cities in borders of the country. Tak, Kanchanaburi, and Chiang Rai are all neighbouring the Myanmar border. Mukdaharn, Nong Khai, and Nakohon Phanom are on the Laos border. Trat and Sa Kaew are on the Cambodia border. Lastly, Songkhla and Narathiwas are near the borders of Malaysia.
The beautiful Bangkok City skyline at dusk
These SEZs targeted to boost Thailand’s economy, border relations, and foreign investments. Businesses and investments in the area that fall under the targeted industries can potentially receive full business incentives from the Board of Investment (BOI), Revenue Department, and the Industrial Estate Authority of Thailand (IEAT).
The 13 target industries of the SEZs are:
- Agriculture, fisheries and related industries;
- Ceramic products;
- Textile, garment and leather products;
- Furniture manufacturing;
- Gems and jewellery manufacturing;
- Medical equipment manufacturing;
- Automotive, machinery and related parts;
- Electronics and electrical appliances;
- Chemicals and plastics;
- Logistics businesses;
- Industrial zones or estates; and
- Tourism businesses.
The Phra Sing in Chiang Rai, Thailand
Some incentives from the BOI include tax exemptions, tax reductions, and deductions in infrastructure costs. Meanwhile, the IEAT can help foreigners get control and ownership of land, be exempted from import and export duties, and loosen restrictions on exporting. BOI has also released a guide on how to invest in SEZs for investors who are interested.
Why should I invest in SEZs?
Aside from the incentives, the Bangkok Post also reported that the Treasury Department recently decided to decrease rental fees to open more doors for investment in the SEZs. Patchara Anuntasilpa, head of the department, said low rental fees on future bidding areas will surely attract investors in spite of the lack of infrastructure in SEZs. This highlights the need for growth of the Thailand property market in these areas. Thai condos can potentially thrive if the areas become business districts since many people would work there.
Tiger Cave Temple at Kanchanaburi
Even though Thailand trailed behind implementing SEZs in Asia, its outcome once completed is anticipated to be great and positive. Thomson Reuters reported that the cross border trade is projected to increase by 50%. The report also says that the Ministry of Commerce is also hopeful that they would reduce illegal trading and human trafficking near the borders by developing these areas into full-fledged industrial estates or business districts.