Thailand: Open to Foreign Investment
Despite internal political tensions and severe flooding in 2011, Thailand continues to maintain an open, market-oriented economy and encourages foreign direct investment as a means of promoting economic development, employment,and technology transfer. In recent decades, Thailand has been a major destination for foreign direct investment,and hundreds of U.S. companies have invested in Thailand successfully. Thailand continues to welcome investment from all countries and seeks to avoid dependence on any one country as a source of investment. Following the significant impact of flooding in 2011, investors are seeking implementation of an improved government water management plan as a critical element to maintaining investor confidence.
The Thai economy remains resilient in the face of the floods and continuing global economic crises. GDP growth in 2010 was nearly 8 percent, and the government anticipated 2011 growth at a rate of four to five percent pre-floods (year-on-year). However, with flooding affecting 60 provinces of 77 provinces, a contraction occurred in the fourth quarter following growth of 3.1 percent in the first three quarters. Annual GDP growth for 2011 was 1 percent for the year.
Despite reduced economic performance due to the floods of 2011, the Bank of Thailand estimates GDP growth for 2012 could be more than 6 percent based on strong first quarter performance.