The strength of Thailand’s supply chain is reflected in its exports of electronic components and equipment, the country’s top export category, which reached USD 31 billion in 2020
The incentives Thailand announced recently to promote investment in the manufacturing of semiconductors and related industries, as well as research and development, aim to further strengthen Thailand’s electronics supply chain at a critical juncture when the sector sees rising investment in face of global challenges, the Thailand Board of Investment (BOI) said.
The value of E&E’s applications in the first half of 2021 is higher than the 50.3 billion baht the sector saw in the whole 2020, when it represented 11.6 per cent of total adjusted pledged value, and was already ahead of all other target sectors.
The Covid-19 crisis has further increased the demand for electronics products as well as critical parts, and companies, including many which already have investments in Thailand, need to expand to ensure resilience in their supply chain,” said Ms Duangjai Asawachintachit, Secretary General of the BOI.
She added, “That’s why we decided to strengthen the incentives we offer to this sector, particularly the activities requiring more advanced technology or large-scale investment.”
In the first six months of 2021, the electrical appliances and electronics industry attracted the most investment among Thailand’s target sectors with 77 projects worth 61 billion baht (USD1.8 billion), a value 136 per cent higher than in the year earlier period. E&E represented 15.8 per cent of the combined value of investments pledged from January to June during that period, according to data the BOI released last week.
The strength of Thailand’s supply chain is reflected in its exports of electronic components and equipment, the country’s top export category, which reached USD 31 billion in 2020. Thailand currently ranks 13th in the world as a base for electronic products and parts manufacturing. In the Printed Circuit Board (PCB) market alone, Thailand is the world’s 7th largest exporter.
Firms spending not less than one per cent of their total sales for the first 3 years in R&D, or not less than 200 million baht, will receive an additional corporate income tax exemption for up to 5 years with no ceiling, the number of additional years depending on the amount of R&D investment. For companies adding R&D investment to the main operation, the longest combined tax exemption period available is 13 years.
