Japan External Trade Organization (JETRO) - Bangkok
Mr. Atsuo Kurada is president of the JETRO in Bangkok. The Bangkok office, established in 1959, is the 5th largest in the world. JETRO has 74 overseas office, with 19 in Asia. In 2004, Japan was the leading investor in Thailand with net investment application worth 101.8 billion baht (US$2.5 billion) representing 33% of the total value of foreign investment applications.
(from BOI Investment Review, October 2005)
What are the Japanese investment trends in Thailand?
This year approximately 80% of new Japanese investment is centered on the automotive industry. Thailand has now become a very favorable automotive export base and several auto manufacturers have closed their Japanese factories to shift pick-up truck production to Thailand.
Aside from automotives, which other Thai industrial sectors are attractive to Japanese investors?
In 2004 we had a much more balanced investment picture with autos representing only 40% of total Japanese investment. Thailand is also becoming an ASEAN center for the production and export of electrical appliances such as refrigerators and air conditioners, and many Japanese firms have invested in these sectors.
Thailand attracts Japanese firms in electrical component, hard disk drive (HDD), computer component and semiconductor manufacturing. The country continues to draw Japanese investment because, throughout the years, Japanese firms have enjoyed good relations with the Thai government and have established strong contact networks here.
How does Thailand compare with other markets for Japanese investment?
Thailand is the second most popular FDI destination after China. China inevitably is an important market for Japan because it is a very convenient production base, but we can’t put all of our eggs into one basket. If a firm has a production facility in China, it should have another base elsewhere to diversify risk. When Japanese firms think of an alternative to China, it is natural to consider a location in ASEAN due to our long history in this region.
Japan has a huge value of accumulated investment in ASEAN, three times greater than in China. ASEAN has a Japanese- friendly business environment and a market of 550 million people under the ASEAN Free Trade Area and is a good base for supporting business expansion into India and the Middle East.
Compared to other ASEAN nations, Thailand is very well-balanced. Its advantages include political stability, favorable BOI incentive policies, well-trained human resources, strong supporting industries and good infrastructure.
What is JETRO's mission in Thailand?
Our overall mission is to strengthen trade, investment and industrial ties between Thailand and Japan.
One major objective is to promote trade between Thailand and Japan. We support Thailand’s One Tambon One Product (OTOP) program, which is designed to strengthen grass roots economic development. Under this program, which is based upon one developed in Japan in the 1970’s, each district in Thailand produces and markets one product. JETRO assists the Thai producers with gaining access to the Japanese market. We organize Japanese trade fairs to promote OTOP products and we send buyers to Thai villages to source products and to provide advice on making product adjustments to better suit the Japanese market.
A second objective is to promote direct investment between Thailand and Japan. In July 2000 JETRO established its first Business Support Center in Thailand. The Center helps Japanese SMEs to establish businesses in Thailand. We provide the firms with a number of business services including free short-term office space and professional Japanese consultants to assist the SMEs with entering and succeeding in the Thai market. Since 2000, 126 Japanese firms have used the Business Support Center and more than 90 have established companies in Thailand.
JETRO, in cooperation with the Thai government, also conducts programs designed to support the nation’s industrial development. We initiated an automotive industry training program in which a “roving” Japanese auto industry expert teaches Thai auto parts suppliers about new technologies and advises on factory upgrades. Later this year we will launch a “train the trainers” program to prepare Thai auto engineers to teach their SME colleagues.
Copyright, 2005 © Runckel & Associates
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