The types of projects to receive funding from the state's Competitiveness Fund were approved on Friday by Prime Minister Prayut Chan-o-cha.
Nathporn: Fund a significant tool to attract companies
The 10-billion-baht Competitiveness Fund was set up as a financial tool of the government to accelerate investment in 10 targeted industries.
The fund is expected to start operations in April after getting the nod from the Competitiveness Fund Policy Committee chaired by Gen Prayut.
Projects that request funding support must be eligible under the guidelines set by the committee.
"The fund will be a significant tool for the government to draw targeted companies to invest in Thailand," said Nathporn Chatusripitak, an adviser to Prime Minister's Office Minister Suvit Maesincee.
The government hopes the fund will allow Thailand to compete with its neighbours such as Vietnam, Malaysia and Cambodia in attracting foreign direct investment in these targeted industries.
The Competitiveness Fund for Target Industries Act 2017 was announced in the Royal Gazette in February.
The first meeting of the new committee yesterday agreed funding should be granted to industries that have never produced in Thailand before, such as high technology, innovation-related projects, and the 10 targeted industries.
"Because the trade and investment climate is changing quickly, the committee agreed to support industries out of the 10 targeted clusters," Mr Nathporn said.
Companies granted funding are required to collaborate with educational institutes on research and development.
The committee has allowed companies to obtain funding once they can prove they meet the requirements, he said.
Mr Suvit has been assigned by the committee to work with the Board of Investment (BoI) on details for the requirements. He will then propose them to Gen Prayut for his approval.
The BoI has amended the investment law to extend the corporate tax break to 13 years from eight years.
The Competitiveness Fund for Target Industries Act allows the government to offer up to 15 years of corporate tax breaks.
Mr Nathporn said Deputy Prime Minister Somkid Jatusripitak will head the team to negotiate with potential investors. Grants from the fund will not be disclosed.
The government allocated 10 billion baht in seed funding from the 2017 fiscal budget. It plans to add more budgetary expenditure to the fund in the future.
He said this fund is similar to strategies in other countries such as Malaysia, which has a 8.5-billion-baht fund for targeted industries, while Singapore has a 70-billion-baht fund.
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