Published on
March 15, 2024

The Wallex Country Report: Thailand

min read

Witnessing average GDP growth of 2.5% between 2010 and 2021, Thailand's has established itself as a major economic player in Southeast Asia. Behind the country’s strategic pivot towards export-oriented industries is a powerful yet diversified economy that ranges from automotive manufacturing to tourism.

Thailand attracts a significant amount of foreign investment, which has exceeded US $30 billion since 2021. This investment and Thailand’s steady growth can be attributed to the country’s strategic location at the heart of Southeast Asia, enabling Thailand to serve as a gateway to lucrative regional markets, while its robust infrastructure and skilled workforce allow international players to establish and grow their Asian presence with confidence.  

Quick Facts

  • Population: 71.6 million
  • GDP (2022): US$495 billion
  • Currency: Thai Baht (THB)
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Thailand Top Imports | Wallex
Thailand Top Exports | Wallex

What are Thailand's top emerging industries? 

Automotive Manufacturing

Thailand leads Southeast Asia in terms of automotive manufacturing with 1.88 million units produced in 2022. Even more impressive is the fact that the country holds the 13th spot globally in auto parts exports. Multiple Japanese automakers, including global giants Honda and Mitsubishi are set to invest as much as $4.3 billion in Thailand over the next 5 years.  

At present, Thailand is pivoting towards EVs with its EV30@30 initiative. One of the goals of this initiative is for 30% of Thailand’s automotive output to be EVs by 2030, making it a fantastic opportunity for component and technology suppliers specialising in batteries, charging infrastructure, and electric motors. The government has even announced plans for a $10 billion EV City to be built near Bangkok in late 2023, signalling a strong commitment to their EV manufacturing plans. In fact, Honda has already begun manufacturing electric vehicles (EVs) in their Thai plants.

Underpinning this success and momentum is the government’s strong support for the industry and the ecosystem it has built up over the years. EV component and technology suppliers can receive up to 8 years’ of corporate income tax exemption, while manufacturers enjoy reduced or zero import duties on production components such as chargers or motors. A skilled workforce is also crucial to this success, with over 500,000 people working in the automotive industry in roles that include engineers, production specialists, and logistics experts. This means companies do not need to invest as much in extensive training or talent acquisition efforts.  

Smart Farming and Precision Agriculture

The agricultural industry in Thailand is one of the country’s leading economic pillars, employing about a third of its workforce, and contributing up to 10% to the nation’s GDP. The country is a global leader in exports of tapioca, rubber, shrimp, tuna, and pineapple, meeting and even exceeding the robust demands of the international market. Recent export figures, such as the 53 million tons of cassava exported in 2022, underline the substantial global demand for Thai agricultural products.

To stay ahead, Thailand is taking steps to modernise its agricultural industry with smart farming and precision agriculture. Initiatives like the Ministry of Agriculture and Cooperatives' "Smart Farm Project", deploy cutting-edge technologies such as AI and drone systems to optimise usage of resources, in particular water and fertilisers, to amplify yields at the lowest costs.  

However, the most ambitious one is Agriculture 4.0, Thailand's roadmap for digitally transforming its agricultural sector. The initiative has borne fruit since its launch in 2017, introducing smart irrigation, drone-based crop monitoring, and produce traceability with platforms like TraceThai. Future plans for Agriculture 4.0 include focusing on advanced analytics and machine learning to unlock better insights on soil health, improve pest management, and automating planting and harvesting with robots. Against this backdrop, robotics developers, big data analytics providers, precision equipment manufacturers can find a ready market for their solutions.

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Medical Devices

The medical devices industry in Thailand stands at an estimated $6.9 billion USD in 2023, with exports exceeding $1.1 billion. Single-use devices such as rubber gloves, catheters, and diagnostic kits, which account for approximately 70% of medical device production. While the government welcomes all medical-related investments, it is particularly interested in thermoscanners and thermometers, ventilators, respirators, and prosthetics, just to name a few.  

There are two key drivers of Thailand's medical devices industry output and growth. Firstly, the country’s ageing population, where it is forecasted that more than 20% of the population will be older than 65 by 2029. The second driver is medical tourism, which Thailand has long been a destination for. In fact, the country has even begun to offer 1-year visas to medical tourists who need longer treatment or recovery time. These factors make Thailand an attractive destination for companies specialising in areas such as personal health tracking devices, surgical robots, and video conferencing tools, particularly as telehealth takes off.

Which key imports of Thailand should we monitor? 

Electrical, Electronic Equipment

The push to switch to renewable energy is gaining traction in Thailand, as the country aims to have it make up 30% of all energy use in the country by 2030. Projects to advance Thailand’s smart grid ambitions are well underway, with the Kingdom ramping up generation on solar and wind power, building energy storage systems, and enhancing capabilities in renewable energy forecasting. Parts for solar panels, wind turbines, advanced sensors and communication technologies will be crucial for Thailand to achieve their renewable energy goals.

Thailand’s EV30@30 initiative is another major driver of demand for electrical and electronic equipment. Outside of batteries, the automotive industry will also need to invest in autonomous driving technologies such as sensors, cameras, actuators, and onboard computing units, just to name a few. At the same time, charging infrastructure needs to be expanded across the country to support greater adoption of EVs, which will lead to higher demand for power distribution equipment, cables and connectors.

Machinery, Nuclear Reactors, Boilers

Agricultural activity and automotive manufacturing accounts for a significant amount of machinery imports into Thailand. Parts and accessories for farming equipment and vehicles such as tractors continue to be crucial for farm operations amidst the push for smart farming and precision agriculture. Within the automotive industry, there is a need for CNC machinery, painting systems, and specialised equipment for engine, chassis, and component production.

Transport network upgrading projects, including the Bangkok–Nong Khai high-speed railway and building of a dry port in Chachoengsao further contribute to the demand for machinery imports. These will require tunnel boring machines and track laying and maintenance equipment, and general construction vehicles like excavators and cranes, particularly for port development and expansion projects.

Vehicles (Excluding Railway & Tramway)

Tractors are one of the main engines of Thailand’s agricultural industry and remain as one of the Kingdom’s top imports, with forecasts for shipments to reach nearly 69,000 units by 2028.  

Specialised vehicles are another source of import demand for vehicles, with the logistics industry depending on refrigerated trucks and vans that support Thailand’s vast agricultural industry and networks. These are vital to ensure the transportation of fresh produce, poultry, seafood and more to their destinations.

On a consumer level, Thailand’s automobile industry is seeing an influx of imported EVs, with a bulk of them coming from China. Furthermore, government subsidies of 100,000 THB per imported EVs has led to greater demand for these vehicles.  

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Take your business into Thailand with Wallex

The first and most crucial aspect of taking your business into Thailand is ensuring that you can easily make and collect payments in THB, and convert your SGD to THB and vice versa – without being subjected to expensive FX rates and slow transaction processing.  

Wallex designed our platform to help your business do just that. Enjoy making same-day payments to suppliers, payroll to employees, and collect money from customers seamlessly. Besides converting your SGD to THB, you can convert other top Asian and global currencies such as USD, GBP, EUR and JPY to THB.

Above all, a dedicated Account Manager will ensure you get the best FX rates and all the help you need when making payments and collections.  

Enjoy speed, support, and savings with Wallex as you expand your business. Speak to us today and bring your business into Thailand with confidence.

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