4 minute read
Thailand's E&E sector: A strong foundation for future growth
Thailand Board of Investment (BOI)
Thailand has long been a major hub for the electrical and electronics (E&E) industry, consistently ranking among the world’s top producers and exporters. Currently, the country's E&E sector comprises approximately 3,000 enterprises and employs around 750,000 people across the supply chain. In 2023, Thailand exported E&E products worth approximately USD 74.36 billion, with key markets including the United States, Japan, Hong Kong, and China. This highlights Thailand's significant role in global trade.
Thailand’s well-established domestic supply chain and extensive use of locally sourced components have been key factors in its manufacturing success for more than five decades. Despite the evolving landscape of the global electronics market, Thailand’s strong foundation continues to give it a competitive edge, positioning the country as a prime destination for new investments in the sector.
However, to maintain its competitiveness amid rapid technological advancements, Thailand is intensifying its development efforts. By focusing on both upstream and downstream segments – particularly in semiconductors and printed circuit boards (PCBs) – the country aims to further strengthen its supply chain and support the transformation of the broader E&E industry.
GOVERNMENT SUPPORT AND POLICIES
To achieve its goal of becoming the regional hub for semiconductors and PCBs, the Thai government has introduced a range of supportive policies. At the national level, the Office of Industrial Economics (OIE) has unveiled the Smart Electronics Industry Development Action Plan. This initiative seeks to enhance the country’s infrastructure, foster innovation, and strengthen technological capabilities, positioning Thailand as a key player in the global E&E market.
Additionally, to further enhance the capabilities of the E&E sector, especially in the upstream industry, the government has established the National Semiconductor and Advanced Electronics Industry Policy Committee (Semiconductor Board), chaired by Thailand’s Prime Minister, Paetongtarn Shinawatra. This body will guide the development of Thailand’s E&E industry, ensuring it remains on the right path and maintains its competitive edge at the global level.
In line with its commitment to attracting foreign investment, the Thailand Board of Investment (BOI) has designated the E&E sector as a priority industry. Last year, the sector attracted investments worth THB 340.4 billion (approximately USD 10 billion), making it one of the leading industries for investment in the country. Major players, particularly in the PCBs sector from China, Taiwan, and Japan, have established a strong presence in Thailand, positioning the country as the top manufacturing base for PCBs in ASEAN. This momentum continues in 2024, with over 55 PCB-related projects receiving promotion applications within the first nine months (Jan-Sep 2024), amounting to THB 61.3 billion (approximately USD 1.8 billion).
Given the priority on upstream electronics industries, the BOI has extended its support to a broader range of activities, from electronic design to PCB manufacturing. This year, the BOI expanded its list of eligible activities for investment promotion to include critical operations such as copper clad laminate (CCL) production, flexible CCL (FCCL) production, and prepreg manufacturing, as well as the production of key materials and components like dry film, transfer film, and backup boards. These efforts are geared toward reinforcing Thailand’s E&E supply chain and accelerating its progress to becoming ASEAN’s leading PCBs manufacturing hub. In addition, semiconductors with further investment in research and development will be eligible for an additional corporate income tax exemption for up to five years.
WORKFORCE DEVELOPMENT TO DRIVE INDUSTRY GROWTH
Recognising the importance of human resources, Thailand is also focused on developing a future-ready workforce to meet industry demands. The Ministry of Higher Education, Science, Research, and Innovation (MHESI) plays a pivotal role in this area by spearheading policies aimed at upskilling and reskilling the workforce, ensuring its adaptability in a rapidly changing global market. In the semiconductor and advanced electronics sectors, MHESI aims to train 80,000 skilled workers within the next five years.
Moreover, MHESI is rolling out mediumand long-term strategies, including the development of a higher education sandbox, the design of international curricula in partnership with leading global universities, and the provision of scholarships for doctoral programs in semiconductor-related fields. These initiatives will ensure a steady supply of highly skilled professionals, driving the growth of Thailand’s E&E industry and securing its competitive position in the global arena.
In conclusion, Thailand's strategic efforts, from government policies to workforce development, demonstrate the country’s commitment to fostering a dynamic and innovative E&E industry. With these initiatives, Thailand solidifies its position as an attractive destination for investors and a leader in the global electronics market.
Contact details:
Thailand Board of Investment (BOI)
Tel: +66 2 553 8111
