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FOREIGN INVESTMENT
VICHAYA PITSUWAN
Foreign investment in Thailand is not progressing as expected because of inappropriate government policies, according to the Joint Foreign Chamber of Commerce in Thailand (JFCCT).
Chamber members yesterday asked for quarterly discussions at which government authorities and foreign investors could review problems and propose solutions.
The Thai government should revise its policies to put existing foreign investors at ease, JFCCT chairman Nandor G. von der Lueche said at a meeting with Industry Minister Suwit Khunkitti and the Board of Investment (BoI) yesterday.
''Contradictory policies have confused us and created a poor impression to existing foreign investors, leading them to hold back their expansion plans,'' he said.
Impractical regulations, he said, were at odds with the stated goal to use BoI privileges to position the country as a prime investment destination.
He cited Thailand's health-care and hospitality promotion programmes, which have drawn numerous investors, but they still face a high corporate tax rate of 30%.
Rivals in Southeast Asia offered special corporate income tax rates _ 28% in Malaysia and 18% in Singapore for example _ to draw hospitality investors, he said.
Mr von der Lueche asked the government to review corporate income tax and other tariff privileges for foreign investors. ''If the government can revised these policies, its attempt to promote foreign investment will be more effective. The JFCCT wants to take a role in identifying these policies and be an adviser to the government on effective policies.''
The three parties agreed to meet quarterly to review the best strategies for Thailand to remain competitive as an investment destination. ''Dialogue is important. We are not here to make demands, we are here to make proposals,'' Mr von der Lueche stressed.
The JFCCT also said that political stability was a main concern for new investors looking at Thailand. Political threats and the slowdown in the world economy made investors more cautious, Mr von der Lueche said.
Mr Suwit said the JFCCT had asked officials to review some measures to improve foreign investment conditions.
However, he denied that political uncertainties should be a big concern for investors, saying that foreign investors were still optimistic about the Thai economy despite political tensions and negative economic indicators.
''Some sectors continue to expand while some may have paused their expansion plans, so it's right to say that not all sectors are affected by the slow economy, and the government is doing its best to promote investment,'' Mr Suwit said.
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