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8 September 2013
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Investors shun Thailand, cross border

Investors are streaming across the border to take advantage of preferential trade arrangements, the Thailand Development Research Institute (TDRI) says.

TDRI president Somkiat Tangkitvanich said local businesses are moving to Myanmar, Laos, Cambodia and Vietnam where they can enjoy export incentives for goods sold to the United States and Europe.

Mr Somkiat was commenting at a seminar organised by the TDRI and the Office of Industrial Economics yesterday. The TDRI president said the implementation of the 300-baht daily minimum wage nationwide has also pushed some manufacturers across the border.

Mr Somkiat recommended the government establish special economic zones along the border, including Kanchanaburi’s Sangkhla Buri district, Chiang Rai’s Mae Sai, Sa Kaeo’s Aranyaprathet and Mukdahan, to help persuade firms to stay here.

The zones could impose special laws concerning minimum wages and foreign workers. He said special economic zones could allow business operators to adapt themselves to rising costs.

The minimum wage hike has hurt many factories in Tak’s Mae Sot district, he said.

“Special economic zones, which offer lower labour costs, will only be short-lived because labourers always prefer working in higher-wage areas,” Mr Somkiat said.

The TDRI chief also emphasised the sustainability of local industry lies in the production of Thai brands and value-added goods. The state needs to step up with research and development help, Mr Somkiat said.

TDRI researcher Ploy Thammapiranon said exports of textiles from Myanmar and Vietnam are increasing as many factories relocate there.

Another TDRI researcher, Saowaruj Rattanakhamfu, warned investors of business restrictions in Vietnam.

Labour costs continue to rise in Vietnam due to the country’s increasing inflation, he said.


Saowaruj Rattanakhamfu, Ph.D.
Vice president for research personnel / Research Director Innovation Policy for Sustainable Development