Investing In Special Economic Development Zone (SEDZ) – Part 2

Investing In The Special Economic Development Zone Part 2

With reference to the previous article on the Special Economic Development Zone – Phase 1 according to Announcement No. 1/2558 by the Policy Committee on Special Economic Development Zone covering five provinces, namely Tak, Mukdahan, Sa Kaeo, Trat and Songkhla. This article will provide additional information on the Special Economic Development Zone – Phase 2 according to Announcement No. 2/2558 by the Committee, which covers another five border provinces, namely below:

1. Special Economic Development Zone: Chiang Rai Province.

“Chiang Rai is a toursism base, food production source, agricultural goods, international shipping center, and a multimodal transportation center”. The zone covers 21 sub-districts in three border districts, namely Chiang Khong, Chiang Saen, and Mae Sai district.

Potential and Opportunities: Situated on the North – South Economic Corridor, which can link up to the north with Southern China (Yunnan County) both by land and by water.  Access by land is possible via Route R3A (crossing at Chiang Khong checkpoint through Lao PDR) and R3B (crossing at Mae Sai checkpoint through Myanmar).  Access by water is possible via Mekong River through Chiang Saen Port. The zone can also link up to the south with Laem Chabang Sea Port for export by sea to other regions.  Hence, Chiang Rai is very capable of providing logistics services to Southern China, Northern  Myanmar and Northen Lao PDR.  It also has great potential for tourism and local industries such as agro and food processing, furniture and timber processing, among others.

Areas of Great Potential:

  1. Mae Sai: Development of cross-border checkpoints in anticipation of trade and tourism; preparation in terms of space for the construction of hotels, convention centers, duty free shops, mass transit and tourist information centers.
  2. Chiang Saen: Free trade area, tax-free zones, international freight transport hub, preparation for the construction of port with cargo transshipment center, warehouse, commercial and office buildings and customs office.
  3. Chiang Khong: Trade and tourism, multimodal transport center, preparation in terms of space for the construction of logistics centers, commercial and office buildings and customs office.

2. Special Economic Development Zone: Nong Khai Province.

“Nong Khai is great for international trade, tourism, and multimodal transport” covering 13 sub-districts of two districts, namely Mueang Nong Khai and Sakhrai.

Potential and Opportunities: Thailand – Lao PDR. is the highest border trade value. Situated within close proximity to Udon Thani airport with connectivities to Vientiane (Laos) about 26 km away via either roadway and railway means, and continuable all the way down to Bangkok. Hence, Nong Khai is equipped with a citywide transportation network consisting of road, rail, and air, which supports economic development related activities in the area as well as the Nong Khai – Loas PDR. (Vientiane and Luang Prabang) – Bangkok network connectivities. In addition, Nong Khai being ranked amongst one of the best city to live in the world should make it an accommodating hub for both Thai and foreign investors.

Areas of Great Potential: International trade, tourism, multimodal transport, and landscapes for logistics centers, commercial, and government agencies.

3. Special Economic Development Zone: Nakhon Phanom Province.

“Nakhon Phanom is a great location for border trade and logistics services area”. The zone covers 13 sub-districts of two districts, namely Mueang Nakhon Phanom and Tha Uthen.

Potential and Opportunities:

  1. Serve as the border trade channel to Vietnam and Southern China (Guangxi County) and the highest trade value in the country, with transporting potentials to the Far East nations (Japan, Korea, Taiwan) through Vung Ang Port, Vietnam.
  2. Nakhon Phanom Airport and Baan Pai (Khon Kaen) – Mahasarakham – Mukdahan – Nakhon Phanom Railway. Developmental plans are in place to connect Nakhon Phanom railways with the country’s main rail line to aid both domestice and international logistics activities.
  3. A production line for quality agricultural products such as rice, sugarcane and cassava, to facilitate development of agro-processing industries, the province also offers scenic overviews of Mekong River suitable for tourism and accomodations development to attract both Thai and foreign investors.

Areas of Great Potential: Border trade businesses, logistics service area, and landscape development for commercial and border trading zones, such as duty free shops, warehouses, convention centers, hotels, and tourist information centers, among others.

4. Special Economic Development Zone: Kanchanaburi Province.

“Kanchanaburi is center to an industrial estate, ecotourism, agriculture and border trade”. The zone covers two sub-districts, namely Kaeng Sian and Ban Kao, of Mueang Kanchanaburi District.

Potential and Opportunities:

  1. Can develop into an economic base given its location on the Dawei Economic Zone (Myanmar) – Eastern Seaboard corridor, therefore capable of cargo transport by sea either through Dawei Sea Port to countries on the Indian Ocean, the Middle East and Europe or through Laem Chabang Sea Port to countries on the Pacific Rim.
  2. Plans are in place to construct a motorway linking Bang Yai (Nonthaburi) – Kanchanaburi border areas to support connectivities between the Special Economic Development Zone in Kanchanaburi and Bangkok Metropolis and its perimeter.  In addition, the agricultural processing, food and beverage, and chemicals and auto industries in the area have the potential of developing a Value Chain based on advantages from easy access to marine bay exits on both sides of the ocean and workforces from neighboring countries.

Areas of Great Potential: Industrial estate that links to Dawei (labor-intensive industries, support industries to automotive and electronics industries, argo and food industry, and plastics industry), ecotourism,  agriculture and regional trade, and landscape utilization for industrial and commercial warehousing.

5. Special Economic Development Zone: Narathiwat Province 

“Narathiwat is great for border trade, food industry and multimodal transport”, covering five sub-districts of the following five districts: Mueang Narathiwat, Tak Bai, Yi-ngo, Waeng and Su-ngai Kolok.

Potential and Opportunities:

  1. Three crosspoints to Malaysia: Sungai Kolok, Tak Bai, and Bukit Tal, support border trade and Thailand – Malaysia tourism, and Narathiwat Airport that provides cargo and transportation services to traveling tourists and investors from both Thailand and Malaysia, linking border areas to main cities in Thailand.
  2. Sungai Kolok (Narathiwat) is the final destination of the Southern Bangkok – Sungai Kolok Railway, with connections to Malaysia (Kelantan) railway into Malaysia, thus, should aid Narathiwat economic opportunities in the close future.
  3. Present of raw materials that can promote agricultural processing industry, such as rubber, and palm oil, coupled with cultural qualities that can support halal industry.

Areas of Great Potential: Border trade, food industry, and transport multimodal. Land utilization for industrial support, logistics center, commerce, architecture research center, halal Industry, and the establishment of economic zone in areas between Muang District (Narathiwat) and Tak Bai crosspoint, with connections to Kuala Lumpur railway system, Malaysia.

Eligible business and investment categories in the SEDZs are entitled to special privileges and government incentives in the form of, for instance, tax incentives, governmental support, and facilitated applications and aids that pertain to related government agencies. Such aforementioned benefits are reflected in policy driven measurements designed by Office of the Board of Investment (BOI) and the Ministry of Finance. Businesses that are not eligible for BOI-induced aid, however, can apply and obtain special privileges through the Revenue Department and Ministry of Finance. Ministry of Finance induced privileges grants corporate tax deduction, from 20 percent to ten percent, for ten accounting periods, to eligibilities with a rough description as follow: new businesses or expansions of existing permanent structures for operational utilizations; revenues derived from production of goods that substitute imports or are maining exported; and production lines that are likely to lose its ability to compete; or revenue generated by services that are provided in the SEDZ. There are other encouraging top-driven measures in place, for example, eligible candidates receiving BOI induced benefits in the SEDZ are allowed to employ foreign workers with required stamped off documents with both specialized and non- specialized skills, and etc. In addition, the government will invest in basic infrastructures (roadways, airports, ports, bridges, railways) as well as customs checkpoints and public utility (electricity, water supply, and water systems) between 2015 and 2016 in target areas according to SEDZ phase 1, in all six checkpoints in the five border provinces, namely, Tak, Mukdahan, Sa Kaeo, Trat, and Songkhla (Sadao – Padang Besar), that adds up to an astonishing investment measure of Baht 10,000 million.

All SEDZs will have a one stop service (One Stop Service: OSS) investment center in place to facilitate investors in a proactive manner, with a focus on swift and comprehensive services in the areas of trade and investment, as well as labor, public healthcare, and security. Investors will be able to contact several agencies in the same place as the center provides information and comprehensive services along with coordinated cross-departmental operations among relevant authorities for license applications of various types, with one stop.

Compiled by BLOG.SCGLogistics

References Guide to Investing in Special Economic Development Zone. The Board of Investment.

Source of Picture  The Thai Chamber of Commerce 

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