MAKING FUTURE FOOD IN THAILAND - Farm and Food Innovations - Australia Thailand Business Council
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MAKING
FUTURE
FOOD IN
THAILAND
Farm and Food
Innovations
Vol. 31 l March 2021
BOI NET APPLICATION
January – December 2020
Total Foreign
Total Investment
Investment
1,717 Projects
907 Projects
US$ 15,342.76 Million
US$ 7,371.24 Million
FOREIGN INVESTMENT BY TARGET SECTORS
First S-Curve New S-Curve
Electronics Biotechnology
127 Projects l 1,356.41 M 6 Projects l 683.26 M
Agriculture
Digital
& Food Processing
105 Projects l 29.59 M
53 Projects l 389.03 M
Automotive Aerospace
87 Projects l 1,055.68 M 3 Projects l 7.94 M
Petrochemicals
Medical
& Chemicals
32 Project l 159.31 M
61 Projects l 1,081.60 M
Automation
Tourism
& Robotics
5 Projects l 151.34 M 8 Projects l 18.34 M
FOREIGN INVESTMENT BY MAJOR ECONOMIES
Netherlands Republic of Korea
72 Projects 26 Projects Japan
595.92 M 85.33 M 211 Projects
Germany 2,421.75 M
21 Projects
98.53 M
United States Switzerland
39 Projects China
783 M 19 Projects 164 Projects Hong Kong
145.66 M 1,003.35 M 76 Projects
522.16 M
Taiwan
THAILAND 56 Projects
371.65 M
Singapore
111 Projects
521.84 M
Indonesia
3 Projects
81.05 M
Unit: US$ (US$ = 31.36 as of 31 March 2021)
Note: Investment projects with foreign equity participation from more than one country are reported in the figures for both countries. Statistics on net
applications are adjusted whenever applications are returned to applicants due to insufficient information. For more details, please visit www.boi.go.th
04 10
Cover Story Industry Focus
Making Future Food in Thailand Exports Remain Resilient in the Midst of the Pandemic
14 15
Highlights Executive Talk
Comprehensive Food-Tech Incubation Network Food of Thailand for a Future World
18 21
Company Interview Thai Economy At A Glance
EnerGaia
COVER STORY
MAKING FUTURE FOOD
IN THAILAND
Thailand’s farm and food industry has been constantly incorporating new innovations in an
effort to meet the increasingly sophisticated demands of a global market that is becoming
swamped with virtually endless options. Staying ahead of the game in this hugely competitive
environment requires access to a wide diversity of raw materials on vast agricultural plantations
and a well-developed supply chain. Leveraging advancements in digitalization and utilizing
deep technology such as 3D printing, AI and big data, the Thai agri-food industry is also
producing foods that align with mainstream intelligence technology as well as addressing
environmental concerns.
Indeed, the accelerating shift of well in 2020, even when global Thailand has successfully developed
consumer demand for innovative demand subsided in light of the its food industry to become the
foods such as alternative proteins, pandemic. As consumers looked world’s 11th largest food exporter
medical food, functional food and for quality food products with a in 2019, placing it second only to
3D food printing has created an long shelf live during periods of China in Asia.
unprecedented change in the restrictive outdoor activity, Thai The Thai government is currently
Thai food industry, with the recent frozen and processed fruits and implementing a medium-term plan
emergence of aspiring startups. vegetables, beans and soup to develop the Thai food industry
Attuned to global trends and powders proved popular, placing extensively with the goal of adding
technology, these startups are them among products that held economic value to local food and
playing a key role in cementing up in the global market. farm products for local economic
top-of-mind awareness of Thailand’s development as well as establishing
food brands among consumers. Food for Thailand among the world’s top
The Thai food development Future Development ten largest food exporters. Thailand’s
industry also places priority on The global popularity of Thai effort will also fulfill its role in
progressing with a greater focus tourism and culture alongside helping address food insecurity
on safety standards and transparency the quality of its food and farm in some countries as exposed by
in each step of production. Notably, products have contributed to the COVID-19 pandemic.
the Thai government recently launch “made-in-Thailand” products Thailand’s vibrant food industry
a blockchain system which serves resonating uniqueness and quality accounts for one-fourth of the
a portal for consumers to trace in the global market. With a skilled country’s industrial gross domestic
and track each process. workforce and an agricultural product and uses more than four-
In the global market, Thai sector derived from a culture deeply fifth of the local raw materials for
food entrepreneurs have showcased rooted in agricultural wisdoms and production. The people’s strength
their strengths with exports performing the well-established supply chain, and the country’s endowment of
04 Thailand Investment Review
vast agricultural plantations, the by ideas on which-with the in SPACE-F were sesame milk,
COVER STORY
diversity of agricultural products, right mentors and investment- protein from duckweed, protein
a well-established agri-food industry, a plausible business model can from crickets, a biodegradable
and a geographic location at the be built, Thailand has seen fruit coating solution and a sensor
center of the ASEAN region have the development of many new system for food production quality
underscored Thailand’s strong homegrown entrepreneurs rolling control.
position in the global food supply out food innovations that utilize Reflecting their interest in
chain. the latest food tech and Agri-tech food tech startups, local multinational
The Thai government has in startups that cater to multiple food companies have also teamed
identified “Future Food” as an consumer demands. up with startup funds to invest in
industry that will become a key “SPACE-F”2, Thailand’s first food tech startups worldwide.
economic driving engine, as a global food tech startup incubator
combination of a passionate new and accelerator, is now running BOI Promoting
generation of food producers, Batch-II acceleration. Run by Agri-Food Technology
digitalization and food technology the National Innovation Agency, The Thailand Board of Investment3
has elevated Thailand’s place to Mahidol University and Thai has introduced tax incentives
a global level in this exciting new multinational food conglomerates, throughout the supply chain of
industry. SPACE-F aims to serve as a the agri-food businesses, with
The government’s food platform on which promising a special focus on technology
development plan focuses on four entrepreneurs can receive in the form of R&D, productivity
areas: building new entrepreneurs, mentorship and guidance from enhancement, Agri-tech, high-
scaling innovations, utilizing online corporations, venture capital firms, technology quality testing, plant
marketing platforms and improving corporate venture capital firms, factories and sustainability
the ease of doing business. and agencies that will empower certification.
Government agencies are them to scale up their food tech
supporting Thai farmers by startups to succeed on the global The incentives offered include:
promoting their adoption of Agri- scale. 8-year CIT exemption for
tech, such as automation & Since the start of the program the manufacture of medical food
robotics, AI, IoT and plant factories, in 2019, four food tech startups, and food supplements
to increase their productivity and out of a total of 34 participants,
overcome problems such as have received funding to scale up
weather uncertainty and high their business ventures. Among
operating costs. the local innovations showcased
The Thai government’s policy
to streamline its digital databases
and the operations of all of its
agencies, as directed by an act
enacted in 2019, will further
enhance Thailand’s standing as
one of the most promising
locations for investment in the
food industry.
Mentoring Food Warriors
The Thai government envisages
Thailand becoming a key global
player in the “Future Food” market-
Photo by nrd on Unsplash
a new genre of food that is both
functional and novel, often involving
R&D and technology-enabled
production processes and services.1
As the food industry can be driven
Thailand Investment Review 05
COVER STORY
8-year CIT exemption for 5-year CIT exemption for
adoption of advanced technology manufacture of oil or fat from plants
such as fruit ripeness sensor, or animals (except soybean)
radio frequency pest control and 5-year CIT exemption for
nuclear magnetic resonance in the manufacture of food, beverage
grading, packaging and storage and seasoning ingredients, excluding
of plants, vegetables, fruits or alcoholic beverages, caffeinated
flowers drinks, bakery products and
8-year CIT exemption for candies
the manufacture of biomolecule 5-year CIT exemption for
and bioactive substance using the adoption of smart farming
microorganism, plant cells or systems such as the use of
animal cells sensors, drones, or greenhouses
8-year CIT exemption for 5-year CIT exemption for
seed industry and improvement investment in plant factories
of plant, animal or microorganism 5-year CIT exemption for
breeding using biotechnology the manufacture of animal feeds
which comply with food safety
standards such as ISO 22000
06 Thailand Investment Review
Pandemic-Driven Changes in Food Consumption
COVER STORY
01 Proactive Healthcare:
Consumers look for foods that boost health and immunity.
02 Switch to Online:
Online channels have become more important for retailers and restaurants.
03 Increase of Household Stock:
Consumers increase household food stocks.
04 More Prudent Spending:
Consumers tend to focus on essential food items to prepare for future crises.
Opportunity for the Thai Food Industry
01 Bean Protein 05
Plant-Based
and Insect-Based
Nutritional Powder, Protein Protein,
Dietary Hemp, Alternatives
Vegan Foods,
Powder Banana Powder Hemp Seeds,
Soy Beans
02 Herbal Powders,
Oil Extracts,
06 Foods for Health
Functional Functional Purposes,
Ingredients Cannabidiol Foods Herbal Foods
(Cbd)Oil
Processed
03 Premium Farm
Products, 07
Chicken Meat,
Proceed Foods,
Organic Seasoning
“Free-From” Halal Food
Food Foods Products,
Fruit Snacks
04 Tuna, Shrimp, 08 Ready-to-Eat
Ready-To-Eat/ Poultry, Pineapple, Authentic Thai Foods,
Ready-To-Cook Rice, Fruits Seasoning Powders
and Vegetables Thai Foods and Sauces
Food
Source: National Food Institute Thailand Investment Review 07
Thailand’s Roadmap for the Food Industry
COVER STORY
(Effective until 2027)
Targets
Achieve Be ranked
GDP of among the top ten
45.8 billion US$ global food
(50% increase exporters
from 30 billion US$ (up from
in 2020) 13th in 2020)
Focus Areas
Businesses
New Entrepreneurs,
Industrial-Scale Farming,
Foods Startups,
Organic Food Technology
Innovations Marketing
Future Food, Platforms
Functional Food, Big Data Management,
Novel Food, Packaging Online Tools, Food Expos
Food
Standards
Traceability, Food Safety Plus,
Reduced Environmental
Footprints
Source: The Ministry of Industry
*1US$ = 31THB as of 31 March 2021
08 Thailand Investment Review
BOI’s Incentives for the Agri-food Industry
COVER STORY
1 6
Manufacture of Medical Food Manufacture of Food, Beverage and
and Food Supplements Seasoning Ingredients
excluding alcoholic beverages,
caffeinated drinks, bakery
8-year products and candies
5-year
CIT CIT
Exemption Exemption
2 7
Adoption of Advanced Technology Adoption of Smart Farming Systems
such as fruit ripeness sensor, such as the use of sensors,
radio frequency pest control drones, or greenhouses
and nuclear magnetic resonance
in grading, packaging and
storage of plants, vegetables,
fruits or flowers
8-year 5-year
CIT CIT
Exemption Exemption
3 8
Manufacture of Manufacture of Investment in Plant Factories
Biomolecule And Bioactive Substance
Using Microorganism,
Plant Cells or Animal
Cells -year 8 5-year
CIT CIT
Exemption Exemption
4 9
Seed Industry and Improvement of Manufacture of Animal Feeds Which
Plant, Animal or Microorganism Breeding Comply with Food Safety Standards
Using Biotechnology such as Iso 22000
8-year 5-year
CIT CIT
Exemption Exemption
5
Manufacture of Oil or Fat
From Plants or Animals
(Except Soybean)
5-year
CIT
Exemption
Source: Thailand Board of Investment Thailand Investment Review 09
EXPORTS REMAIN RESILIENT
INDUSTRY FOCUS
IN THE MIDST
OF THE PANDEMIC
Thailand’s food exporters have found opportunities in the midst of the current crisis brought
on by the COVID-19 pandemic. As consumers worldwide visit supermarkets and dine in
restaurants less often, they are buying more processed and canned foods to cook at home as
well as more ready-to-eat foods.
beverages by 2%; and pet foods
by 19%. Data from the Thai Food
Processors’ Association showed
that exports of ready-to-eat food
grew 6% by volume in 2020.
Asian markets, including China,
Malaysia, Hong Kong, Singapore,
Russia, and the CLMV group of
countries (Cambodia, Laos, Myanmar
and Vietnam) were among the key
importers of Thai food products
Photo by Dose Juice on Unsplash
in 2020.
Thailand’s food export
performance in 2020 has been
in line with the government’s
development plan for the industry,
which focuses on high valued
food products or the so-called
“Food for the Future” due to its
Thailand recorded a healthy the exports of foods and products potential for generating higher
growth in the export of processed that are associated with the new outputs and broader impacts on
foods such as fruits and vegetables normal, such as smart electronics, the country’s industrial supply
and canned seafood, which is in furniture and decorative items as chain.
part attributed to economic recovery well as medical devices. The government’s development
in those buying countries. The Official data from the Ministry of targets include establishing
trend has highlighted the strength Commerce’s show that Thailand’s Thailand among the global top ten
and diversity of Thailand’s food total export volume contracted by food exporters by 2027. Thailand
supply chain, which is serving the 6% in 2020, with the market share was ranked in 13th place in 2020
country’s goal of producing foods in global food export products and 11th place in 2019, with the US,
to cater to the growing demand standing at 2.3%. Against the the Netherlands, Brazil, Germany
among global consumers for backdrop of the pandemic, fresh, and China ranked the top five
nutritious and functional foods frozen and dried fruits grew by largest food exporters.
that serve their specific needs. 14%; canned and processed fruits Two-thirds of the outputs from
by 2%; soup powder by 30%; Thailand’s US$ 100 billion food
Healthy Food Exports frozen poultry by 15%; processed market are sold locally, while the
While the pandemic has adversely fruits by 8%; seasoning sauces country’s food exports are fairly
affected world trade, Thailand by 8%; canned and processed evenly divided between processed
has recorded healthy growth in seafood by 5%; non-alcoholic and raw foods.
10 Thailand Investment ReviewBased on the forecast for groups for the blockchain project. among consumers who are
INDUSTRY FOCUS
world economic growth of 5.5%, Furthermore, the Thai government’s increasingly focusing on health
Thailand’s Ministry of Commerce ongoing process of streamlining impacts and solutions to climate
projects an increase in Thai food the digital databases of government change. Plant-based meat also
exports of 7%, with the export of agencies will better facilitate offers a more affordable protein
frozen seafood expected to grow Thailand’s food and farm product alternative.
by 2% in 2021. development. This global shift, which is
Placing top priority on gaining highlighted by the entry of plant-
Transparency Reassured the trust of global consumers based meat in major global food
The Thai government has in exported Thai food products, chains, points to a favorable
applied blockchain technology the Thai government has also future for Thailand as not only a
that enables the traceability of introduced the “Thailand Delivers major producer of agricultural
locally produced food products. with Safety” campaign to step products such as beans, fruits,
By scanning QR codes and up monitoring of the measures vegetables, herbs, cassava, corn
trace manufacturing lots in the implemented by local food producers and rice but also a promising
government’s database through and logistics service providers to producer of future food.
the www.TraceThai.com website, prevent against COVID-19 virus Tapping into this new trend,
buyers of Thai food products contamination of frozen foods food startups and corporations in
can trace the origin and track and other food products. Thailand have rolled out plant-
the journey of the products from With Thai foods having become based meat produced from various
harvesting and manufacturing well-recognized globally for their materials such as mushroom,
to processing and along the high safety and quality standards jackfruit, rice, coconut and beetroot,
transportation process as well as through compliance with GMP, as well as beans, to serve both
viewing any organic certificates HACPP and GAP, the country’s local and global markets.
that have been issued. This initiative food producers are joining a A study by the National Science
will further enhance the credibility “quality plus” campaign which is Technology and Innovation Policy
and transparency of Thai food intended to encourage all food Office (STI) showed that the food
products among consumers in producers to improve their quality industry is among the second
terms of safety, environmental assurance standards. largest industrial sectors investing
and other social issues. in R&D, after the auto industry.
Through cooperation with Future in Hand The R&D activities in the food
agencies at the provincial level The global mainstreaming of industry cover a wide range
and its overseas representative plant-based meat is happening of areas including automated
office, the Thai government expects not only within the vegan and production processes, packaging
to sign in at least 150 agricultural vegetarian communities, but also development, consumer behavior
and new product development,
with a value of US$ 530 million
in 2018, Many enterprises are
now establishing R&D centers,
either on their own premises or in
science parks.
According to Food Innopolis,
approximately 25% of Thai food
researchers have expertise in
grains, cereals and legumes, followed
by 17% in functional food; 13% in
vegetables and mushrooms; 12%
each in seafood and meat; 8%
each in dairy, herbs, spices and
essential oils; and the remainder in
juice, sugar and tapioca starch.
Photo by LikeMeat on Unsplash
Thailand Investment Review 11Thailand’s Food Export Forecast
INDUSTRY FOCUS
(2020/2021f) Units: million US$
Rice 4,000 (+5.7%)
Poultry 3,500 (2.0%)
Sugar 2,700 (51.3%)
Canned Tuna 2,500 (3.6%)
Cassava Flour 2,100 (7.4%)
Shrimp 1,400 (-2.2%)
Seasoning Ingredients 890 (+4.1%)
Ready-To-Eat Food 645 (+4.6%)
Coconut 630 (+2.3%)
Pineapple 530 (+8.0%)
Source: The Thai Chamber of Commerce and Board of Trade of Thailand
Local Sales of Ready-To-Eat Foods
Value: (million US$)
(+10.7%)
(+10.6%)
(+10.5%)
(+9.6%)
(+9.2%)
2016 2017 2018 2019 2020
12 Thailand Investment ReviewProduct Share Export of Ready-to-Eat Foods
INDUSTRY FOCUS
(Qty)
Shelf Stable Ready Meals 0.8% Value: (million US$)
Dried Ready
Meals
7%
(+11.7%)
(+11.2%)
(+10.6%)
Chilled
Frozen Ready Meals (+6.3%)
44.1% 48%
Ready Meals
(+1.2%)
2016 2017 2018 2019 2020
Product Share Top 5 Markets for Thai RTE Foods
(Nationality)
CLMV
Oceania
Thai 45%
Chinese 29% US
Italian 11% EU-27
Japanese 6%
Others 9% Hong Kong
Forecast
of Local
Ready-To-Eat Top 5 Exporters of RTE Foods
Food Sales China
Italy
10.6%
US
9.5%
9.0%
South Korea
6.5%
Thailand
5.8%
764 Million US$
Value:
Growth: 10% Source: National Food Institute
Thailand Investment Review 13Valley, an R&D complex located
HIGHLIGHTS
in the Eastern Economic Corridor.
Focusing on application of digital
technology in the farm and
food innovation and production
processes, the Food Innopolis aims
to drive Thailand as a regional
center of future food industry
and advanced agriculture and
biotechnology.
The Future Food Lab zone
offers a similar one-stop service
COMPREHENSIVE
center to the facilities at Thailand
Science Park which provides
assistance to businesses in R&D
FOOD-TECH and scaling innovations, such as
lab access to facilities and experts
INCUBATION to help with developing prototypes,
finding raw materials, marketing,
and applying for regulatory
NETWORK approval.
The EECi compound also
offers an IoT test bed service for
areas including precision farming,
As part of the Thai government’s consistent support for R&D smart harvest and packaging,
and scaling innovation in food technology, the country houses robotics for fruit harvesting and
integrated R&D centers linking the public sector’s high-quality packaging, automated pilot plants,
smart logistics, smart warehousing
facilities with universities and private sector labs. and retail distribution, and software
system integration. The facility
Central to the network is Food food standardization and testing. is also a research area for big
Innopolis, an integrated food These facilities include Food and data, AI and machine learning
innovation complex located at the Feed Innovation Center, Bioresource applications to support database
Thailand Science Park, Pathum Thani Center, Central Lab, Sensory development and traceability for
Province. Under the supervision of Evaluation Center and the the farm and food industry.
the National Science and Technology Synchrotron Light Research To strengthen the country’s
Development Agency (NSTDA), Institute which offers molecule- food tech ecology, the facility also
the complex offers comprehensive based research analysis, which helps develop similar operational
services to R&D and business are also located at Thailand concepts in seven well-regarded
development, ranging from rental Science Park. provincial universities, which have
space for laboratory facilities, To date, more than 40 local a history of producing skilled
sourcing personnel and technical food conglomerates, multinational human resources in the field of
assistance in R&D and business companies and SMEs have agricultural technology. These
development as well as applying established R&D activities in the universities include Kasetsart
for approvals from Food and Drug innovative food cluster for products University, Chulalongkorn University,
Administration to entrepreneurs. such as seafood, poultry, dairy, Mahidol University, King Mongkut’s
Food Innopolis also offer nutritional and functional foods, University of Technology Thonburi,
networking and knowledge as well as in the areas of food Chiang Mai University, Kon Kaen
sharing services to members and safety, automation and robotics. University and Prince of Songkla
easy access to the public sector’s Food Innopolis has opened University.
facilities in food technology and a facility at EECi in Wangchan
14 Thailand Investment ReviewFOOD OF THAILAND
EXECUTIVE TALK
FOR A FUTURE
WORLD
The COVID-19 pandemic has taken a heavy toll on
most economies worldwide. Thailand is no exception.
However, Thai food exports have become a bright
spot, bucking the trend of the country’s overall sliding
exports, with the demand for processed and canned
foods having held up in these uncertain times.
This trend reflects the surge in global demand toward home
cooking and ready-to-eat foods in the wake of restrictive
measures to contain the pandemic. The resilient export of food
and farm products also highlights Thailand’s commitment
to R&D and advancements in the application of technology
to meet the growing demand of consumers for nutritious
and quality food products that serve the specific needs of
each individual, while also meeting the expectations of the
younger generation for reduced environmental footprints
from the manufacturing sector.
In line with the “Thailand 4.0” strategic economic
development plan, which is aimed at extensively developing
the use of technology within Thai industries, the Thai government
has designated the agri-food industry as a priority area. The
plan aims to strengthen the food technology ecosystem
to enhance the economic value and global positioning of
Thailand’s farm and food industries.
The Tha ila n d B o a r d of
In v e st me n t ( B O I) , t h e key
government agency entrusted
with promoting investment in
the country’s strategic direction,
is offering incentives in the form of
exemptions on corporate income
tax (CIT) and import duty on
The pandemic has pushed consumers raw materials to both Thai and
foreign investors, with a focus
worldwide to become more health on enhancing R&D in food
conscious and focus on the nutritional technology. The incentives cover a
benefits of foods. This global trend, comprehensive range of activities,
especially those related to
which we are also seeing in Thailand, investment in R&D or those
creates tremendous new opportunities adopting biotechnology, digital
for food innovations, food safety and services, and robotics and
automation which can further
organic foods. increase the competitiveness of
the industry.
Sonklin Ploymee
BOI’s Deputy Secretary-General Thailand Investment Review 15The BOI offers 8-year CIT
exemption on the manufacture of
functional and medical foods and
food supplements, with additional
CIT exemptions for companies
that invest in upgrading their
production through Agri tech,
food tech, digital technology,
automation and robotics and
plant factories to improve the
efficiency of both production and
quality testing activities.
Responding to the following
questions, Ms. Sonklin Ploymee,
the BOI’s Deputy Secretary
General, explained the direction
taken by Thai policymakers in
promoting investment in the Under the Thai government’s ASEAN countries. Even so, there
agri-food industry and possible development plan for the agri- is still a need to focus on R&D in
additional incentives. food industry, which is effective order to increase the value added
until 2028, the country has set to the processed food industry.
How significant is the agri-food industry the target Thailand is also among the top
the agri-food industry’s of generating 7% of GDP, with ten most competitive countries
contribution to efforts focusing on R&D and in the food processing industry.
the Thai economy? productivity improvement. According to Oxford Economics,
The food industry has long driven Thailand’s food processing industry
Thailand’s economic development What are Thailand’s was ranked 9th worldwide in 2016,
through the value it adds to the best competitive with the Thai government aiming
agricultural sector and industrial advantages in agri-food to reach 3rd place by 2026. The
supply chain, covering 128,000 technology? Thai government’s commitment to
mainly micro enterprises, employing Thailand has a year-round promote biotechnology and R&D
more than one million people – agricultural season and vibrant is seen as a key factor in increasing
representing about 3% of the agri-food industry, producing confidence in the country’s food
country’s workforce – and the largest exports of cassava, processing industry.
generating approximately 6% of canned tuna, canned pineapple, Thailand’s food processing
the country’s gross domestic rice and sugar as well as a variety industry will also benefit from
product. of other food products to the large investment in transportation,
As one of the targeted world. utilities and modern special
beneficiaries of the “Thailand The country’s food processing economic zone infrastructure, which
4.0” policy, the food industry will industry currently uses as much will make it the best-connected
receive further incentives and as 80% of local raw materials country in the ASEAN region.
support from the government aimed in its products. This enables Thailand also enjoys a strategic
at enhancing its competitiveness entrepre n e urs t o o pe ra t e location at the heart of the
by building on its strengths and with low costs, enhancing the ASEAN market, whose combined
potential. The Thai government competitiveness of the food population of 650 million is
has long promoted Thailand as processing industry in the global roughly half of China’s, making
the “Kitchen of the World” in market. it a significant consumer market.
recognition of the country’s Thailand’s long history in the Moreover, the China-Thailand Free
strengths in the food industry, agri-food industry has enabled Trade Agreement and Thailand’s
particularly the abundance of raw the country to develop its membership in the ASEAN Free
materials, large pool of skilled productivity. Indeed, Thailand has Trade Area have bolstered the
labor and well-established and the most competitive ecosystem country’s trade and economic
competitive supply chain. for food technology among the growth.
16 Thailand Investment Reviewhave promoted a wide range of
EXECUTIVE TALK
measures to help entrepreneurs
enhance their efficiency in the
food supply chain, from upstream
to downstream, and our efforts
extend beyond manufacturing to
the service sector in the agri-food
industry.
R&D is a target activity of
our promotional incentives. The
BOI’s additional incentives will also
be offered to entrepreneurs who
invest in productivity, even if
they do not increase production
capacity. The BOI is also considering
new incentives to further strengthen
Thailand’s food positioning in the
Photo by Shalitha Dissanayaka on Unsplash
become more health conscious world market.
and focus on the nutritional
benefits of foods. This global How do you foresee
trend, which we are also seeing Thailand’s development
in Thailand, creates tremendous of the food industry
new opportunities for food in the world market?
innovations, food safety and There is huge potential in the
organic foods. Thai food industry, primarily given
In this regard, innovations and the abundance of raw materials,
technology are the areas where pool of skilled labor, steadfast
In terms of human resources, we are taking serious actions to institutional support, and advanced
Thailand has a highly skilled move the development forward. infrastructure.
workforce, with solid institutional As a large and growing Government agencies, not
support and efficient recruiters to percentage of the world population only the BOI, have promoted
meet the workforce demands of consumes Halal food, for which productivity, quality, technology
investors. the “Made-in-Thailand” brand and R&D in the food industry.
is well-regarded, the country is As I mentioned before, the
What could emerge well-positioned to harness the food industry is at the top of the
as Thailand’s most opportunity deriving from this agenda of the Thai government’s
recommended products consumer group. efforts, given its importance to
in the global market? Overall, Thailand has a our population.
If we consider the present behavior diversified food industry with high The Thai government has
of consumers worldwide during capability to harness the potential ensured strong institutional support
the pandemic, there will be plenty of medical and functional foods is in place to promote capacity
of opportunities for Thailand’s and serve the increasing demand building in important areas such
food processing industry. People from the aging society. as the international standard for
are forced to stay at home and foods, innovations, marketing and
cook at home, as they cannot What roles have support for small and medium-
go to supermarkets as often as the government and BOI sized enterprises. With this
before. As a result, ready-to-eat played in enhancing direction, I am confident that
food has high potential. Thailand technology in Thailand is well-positioned to be
can further apply technology the agri-food industry? the largest investment hub in Asia
and automation to roll out more The Thai government and the for the food industry and to have
innovations and raise productivity. BOI have steadfastly supported a larger share of the world food
Moreover, the pandemic has technological capacity-building market.
pushed consumers worldwide to in the future food industry. We
Thailand Investment Review 17INTERVIEW WITH “ At least for us, Thailand
COMPANY INTERVIEW
has an abundance of
great talents who are
Saumil Shah, skilled microbiologists
and professionals
founder and CEO in the agroindustry.
The country has
of EnerGaia an important agroindustry
and very good reputation
for the foods it produces.
When we create new
and nutritious products
here and export to
countries in Western Europe
and the United States,
people’s perceptions of
these products are
relatively more positive
in terms of quality than
for similar products from
other countries.”
Saumil Shah
Founder and CEO of EnerGaia
and sustainable food options among
consumers worldwide. Having
been working for General Electric
on energy projects in Thailand,
US-born former engineer Saumil
Shah founded EnerGaia in 2009
out of his desire to offset the
impacts of carbon emissions by
the energy industry. In a diverse
kind of algae which grows faster
than trees and thus absorbs CO2
more efficiently, he found his
solution in spirulina.
Aside from the sale of fresh
and processed spirulina worldwide,
The Simple Protein of the Future EnerGaia also offers its unique
proprietary bioreactor technology
On the rooftop of a spacious 3-story shophouse close to downtown as well as engineering and scientific
Bangkok lie rows of airlift plastic-wrapped wire mesh columns filled with consultation for spirulina farms.
green water. Resembling something out of a seafood farm, they are in Mr. Shah discussed EnerGaia’s
fact EnerGaia’s proprietary technology used for harvesting spirulina, business expansion plan in Thailand
single-celled algae that have gradually evolved from being known for along with the competitive
many years only as food supplements into part of mainstream plant- advantages it offers investment
based diets in response to the growing demand for more eco-friendly in the food sector.
18 Thailand Investment Reviewalmost two kilograms of protein
per year. This is a good amount
because a normal person would
need to consume 50 to 100 grams
of protein per day. Our system can
connect 40 tanks under a central
control system. On average,
each tank can produce 15 to 20
kilograms of fresh spirulina per
year, depending on the weather.
Spirulina takes 7 to 10 days for
each harvest.
What are the competitive
advantages of your
investment in Thailand?
I founded this business from the
What are EnerGaia’s What makes your motivation of using microbiology to
technological spirulina products and reduce carbon dioxide emissions
innovations and farming solutions from power plants, industrial plants
products? unique? and other sources by turning algae
We offer unique bioreactor technology Our technology produces a very into something productive so that
and solutions for farming spirulina, clean, neutral-tasting and high- people can have a very good
a highly nutritious single-celled quality spirulina that will also have environmental footprint from food.
algae that can grow floating in a very long shelf life. Normally, Because microalgae like spirulina
the water, with high quality and a fresh spirulina that grows upon grow very well in tropical conditions
neutral taste. People around the ponds will have a short shelf life where the temperature is around
world typically grow spirulina in of less than one week. With our 30-32 degree Celsius, countries
open and shallow ponds. However, technology, including what we with tropical environment like
there’s a problem with that design have done on the processing Thailand are the places where
as many things can fall inside side, our fresh spirulina can have spirulina can grow very well.
and contaminate it. We have a shelf life of three to four weeks At least for us, Thailand has
adapted a technology from the if stored in a refrigerator. Also, it an abundance of great talents
oyster industry in Australia and doesn’t have a bad taste or smell. who are skilled microbiologists and
other countries and modified it The technology allows us to use professionals in the agroindustry.
to grow spirulina. We use plastic spirulina either in fresh form or The country has an important
bags inside of wire mesh cages processed form as we can also agroindustry and a very good
and turn them into containers for dry it into powder for people to reputation for the foods it produces.
growing spirulina outdoors in the add to or mix into their foods. When we create new and nutritious
sunlight. With our spirulina smart Because of this neutral taste, we products here and export to
farming software, we can monitor can process spirulina into finished countries in Western Europe and
the parameters of the growth mainstream food products like the United States, people’s
rate and recommend farming energy bars, pasta or noodles perceptions of these products are
methods and ingredients. Our for consumers to receive the relatively more positive in terms
technology is actually a smart nutritional value from spirulina. It of quality than similar products
farming solution for spirulina. can be blended into mainstream from other countries.
With automation for the outdoor food products to give them a
system and the software system, greener color without changing What is your vision for
anybody can produce a very high- the original taste. your operations in
quality product. We are offering Spirulina farming also doesn’t Thailand?
this technology in Thailand and require a lot of space. Each I want to offer a comprehensive
finding partners to work with us. farming tank occupies just one solution for spirulina production
We also have overseas operations square meter and can generate in Thailand and elsewhere, to
to find customers.
Thailand Investment Review 19COMPANY INTERVIEW
use in products they’re already
accustomed to, such as natural
energy bars, noodles and western
pasta, without changing the original
taste.
grow it from a small niche industry What kind of perception
today to become a big industry do consumers have of How have the government
producing millions of tons of your products? agencies and the BOI
spirulina per year, and I want The generation X and generation supported your venture
Thailand to be one of the main Y around the world are interested in Thailand?
places it’s produced. in sustainable food, healthy food With the BOI’s investment benefits,
Thailand is also the headquarters and plant-based food. This trend they have made it easier for
for us, where we oversee technology, is rising to a larger percentage of foreigners to obtain work permits
produce foods and try to find the population and even though for foreign experts who are
production partners. We work we started this business some skilled in different areas such as
with many factories here to create years ago, before this trend started, engineering, science, and R&D.
finished products for export to the now it still seems good timing The Thai government is also
West and for local consumption. for us. Given that spirulina is a trying to promote smart farming
Our vision is to continue to microalga, or a form of plant-based technology which will benefit the
expand by working with different protein, that is rich in protein, with Thai economy. I think there are
partners to grow more spirulina actually 65% protein in powder still a lot of opportunities for the
and then use it to make finished form, and also a good source of Thai government and the BOI to
food products, some of which can vitamins and minerals such as iron, make it easier for foreign experts
be sold locally, but more, around it resonates well with consumers. to start businesses in Thailand.
70%, will be exported. We also However, they don’t know how I believe they are working in
plan to increase our exports to to use it, either in fresh form or that direction but there are still
Asian markets. powder. That’s why we’re trying opportunities to make more
to make it very easy for them to progress.
14 Thailand Investment ReviewTHAI ECONOMY At A Glance
Key Economic Figures
Unemployment Investment Growth Market Profile
GDP (2020*) Dec 2020* (2019)
US$ 506.4 Billion 2020 2021*f
-4.8% 5.7% Population
GDP per Capita (2020*)
66.56
Million
US$ 7,328.2 / Year 1.5%
GDP Growth Headline Inflation Export Value of Goods Growth
Average 2020* Minimum Wage
2020 2021*f 2020 2021*f THB 313 - 336
-6.1% 2.5-3.5% -0.85% -6.6% 5.8% US$ Approximate
US$ 9.98-10.71
Note: *Estimated value l Source: NESDC Source: National Statistical Office, Note: *Estimated value Source: Ministry of Labour
(Data as of March 2021) Ministry of Commerce Source: NESDC
Top 10 Export Markets (January-December 2020 )
Rank Value Share
(US$ million)
United State 34,343.71 14.83%
China 29,754.18 12.85%
Japan 22,876.34 9.88%
Export Figures Hong Kong 11,292.25 4.88%
Vietnam 11,163.82 4.82%
Export value (USD million) Australia 9,828.83 4.25%
Jan - Dec 2019 : 246,268.8 Singapore 9,508.92 4.10%
Jan - Dec 2020 : 231,468.4 Malaysia 8,734.50 3.77%
Jan - Feb 2021 : 39,925.6 Indonesia 7,650.26 3.30%
Switzerland 7,525.32 3.25%
International Top 10 Exports
Competitiveness
Value
Goods / Products (US$ million) Share
Global Competitiveness
2018 : 38th 2019 : 40th 1. Vehicles and Parts 21,266.84 9.19%
Source: World Economic Forum 2. Computers and Parts 18,668.85 8.07%
3. Jewelry 18,207.33 7.87%
World Digital Competitiveness 4. Rubber Products 12,113.82 5.23%
2019 : 40th 2020 : 39th 5. Plastic Pellets 7,971.54 3.44%
Source: IMD 6. Integrated Circuits 7,155.14 3.09%
7. Chemical Products 6,735.69 2.91 %
Ease of Doing Business 8. Machinery and Parts 6,528.00 2.82%
2019 : 27th 2020 : 21st 9. Refined Fuel 5,354.92 2.31%
Source: World Bank 10. Air Conditioners and Parts 5,251.81 2.27%
Source: Ministry of Commerce
Exchange Rates Tax Rate
(As of 31 March 2021) Corporate Income Tax: 0 - 20%
Personal Income Tax: 5 - 35%
VAT: 7%
THB 31.36 THB 43.49 THB 37.08 THB 28.69 THB 4.84 Witholding Tax: 1 - 15%
(100 Yen)
Source: the Revenue Department
Source: Bank of Thailand (As of March 2021)
Thailand Investment Review 15ABOUT BOI
The Office of the Board of Investment (BOI) is the principle goverment agency
that operates under the Prime Minister’s Office for the purpose of encouraging
investment in Thailand. We at the BOI serve as the professional contact points
for investors, providing them with useful investment information and services.
We offer business support and investment incentive to foreign investors in
Thailand, including tax and non-tax incentives. A few non-tax incentives include
granting land ownership to foreigners and facilitating visas and work permits.
Besides serving the needs of overseas investors, we also offer consultation
services to Thai investors who are interested in investment opportunities abroad.
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