Thursday, July 30, 2015

Thailand sells itself as gateway to Mekong region

PETER JANSSEN, Contributing writer

A signboard at the Thai village of Sop Ruak on the Mekong river in the Golden Triangle region where the borders of Thailand, Laos and Myanmar meet.

BANGKOK -- The Stock Exchange of Thailand is hitting the road this year to promote its wares to potential customers. But unlike previous attempts to flog Thai stocks to overseas investors, its motivation now is to educate foreign companies -- particularly those in Japan, China, Cambodia, Laos, Myanmar and Vietnam -- about its new, more relaxed approach to taxation and regulation, and encourage them to look to the Bangkok bourse as a funding platform.

     Thailand is capitalizing on the new wave of foreign direct investment into the Greater Mekong Subregion -- comprising Cambodia, Laos, Myanmar, Thailand, Vietnam and southern China -- by positioning itself as the finance hub for the burgeoning area. Its strategy is two-pronged. As the area's bigger and more sophisticated cousin, Thailand hopes to be the capital market on which Cambodian, Lao, Myanmar and Vietnamese companies can raise funds. Its strategic position also means it can be the launchpad for Japanese and Chinese companies looking to push into the subregion.

     "It's huge," Atikrai Chatikavanij, founder and portfolio manager of boutique investment company Ton Poh Thailand Fund, said at a recent industry function. "Myanmar is opening up as the last piece in the puzzle. It makes the Greater Mekong Subregion one of the most exciting investment opportunities you can find anywhere in the world."

     Indeed, overseas companies and investors are becoming aware of this potential. The Stock Exchange of Thailand's July roadshow in Tokyo drew more than 200 Japanese companies. With economic growth in the subregion averaging over 8% each year over the past two decades, per capita income has more than tripled over the same period, according to the Asian Development Bank. For Japanese companies looking to grow earnings beyond their borders, the region is attractive.

     "In the past we provided them with labor, land and road links," said Pakorn Peetathawatchai, head of the exchange's corporate strategy division, referring to Thailand's relationship with Japanese companies. "But now we are giving them something more: funding. Also, we are thinking, 'How can we get all these investors interested in Thailand as an entry point to the region?'"


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