Speaker Introduction

Chang Yu-fan | Secretary-General of the Thai-American Business Association of Azov, Thailand. He came to Thailand from Taiwan in 1992 and has served as the secretariat secretary for over 30 years since 1994, witnessing Thailand's transformation from a tourism-based economy to an industrial one. He has long assisted Taiwanese businesses with company establishment, BOI applications, foreign worker recruitment, and factory compliance matters. He is familiar with Thai policies and administrative procedures and is a highly trusted "local advisor" for Taiwanese businesses settling in Thailand.

Thailand's transformation is accelerating: from a tourist destination to an industrial hub.

"When I came to Thailand in 1992, it was still a country primarily focused on tourism," Zhang Yufan recalled with a smile. Over the past thirty years, he has witnessed the restructuring of Thailand's industrial structure. In the past, foreign investment focused on tourism and consumption, but after the outbreak of the pandemic and the restructuring of the global supply chain, Thailand began to be recognized again. In recent years, PCB factories have been relocating from Taiwan and mainland China, with nearly 30 factories now established in Thailand , and an electronics manufacturing chain is gradually taking shape. PCBs are known as the "mother of electronics," and with their establishment, components, molds, packaging, and logistics have also begun to move in, allowing the entire industrial ecosystem to regain its footing along the Eastern Economic Corridor of the EEC.

BOI: A Passport to Preferential Investment for Foreign Investors

The Board of Investment (BOI) is the most crucial "ticket" for foreign companies in Thailand. This agency, directly under the Prime Minister's Office , is specifically responsible for approving foreign investment projects. Companies that obtain BOI qualification not only enjoy tax exemptions on imported machinery and raw materials , but also receive corporate income tax reductions and preferential policies for attracting foreign workers for 3 to 8 years.

Chang Yu-fan pointed out, "BOI reviews not only the amount of capital, but also whether a company can drive Thailand's development." The more companies invest in R&D, create jobs, and have a high export ratio, the more incentives they will receive. BOI is not just a piece of paper, but a complete investment ecosystem. Taiwan currently has a BOI office in Bangkok, allowing for pre-trip assessments and discussions before traveling to Thailand.

He cautioned that documentation must precede the application process before applying for a BOI . Everything from the company's articles of association and capital to the scope of production must be clearly defined. Many new businesses choose to collaborate with agencies or Taiwanese business associations to handle establishment, visas, and factory registration in one go, reducing trial-and-error costs.

IEAT: A protective umbrella for industrial zones that gives foreign investors peace of mind.

When setting up a factory in Thailand, choosing an industrial zone is more important than choosing a city . IEAT (Industrial Estate Authority of Thailand) is the industrial zone administration of Thailand, and 68 of the more than 180 industrial zones nationwide are under its supervision .

Zhang Yufan described it this way: "You can tell whether a park is reliable or not just by looking at whether there is an IEAT sign at the entrance." The biggest advantage of the IEAT industrial park is that it allows foreign companies to own 100% of the land without having to apply for a BOI in advance. The park also has standard operating procedures for water, electricity, sewage, safety and management.

This system not only helps businesses avoid unnecessary detours but also effectively mitigates local uncertainties. "Within IEAT, you only need to focus on building your factory and don't have to worry about who will come knocking on your door every day," he added with a smile, explaining that this is the "predictability" that Taiwanese businesses value most.

Foreign worker system: MOU model ensures stable supply

Thailand allows the legal importation of foreign workers, primarily from Myanmar, Laos, and Cambodia , and manages them through intergovernmental MOUs (Memoranda of Understanding). Zhang Yufan said, "As long as you are a BOI (Board of Incorporated) factory, 50, 100, or even 200 foreign workers are not a problem, but you must submit the list three months in advance ." This gives the government enough time to process visas and health checks.

The MOU model allows foreign workers to become formal employees of the company, enabling them to stay long-term and reducing turnover. When combined with local personnel training and skills upgrading programs, overall productivity can be increased by more than 20%.

The reality of purchasing land outside the district: law and unspoken rules coexist.

Thai company law restricts foreign ownership, generally requiring a 51:49 ratio (Thai: foreign). For complete foreign control, an FBL (Foreign Business License) is required. However, even with this restriction, foreign investors are still prohibited from directly purchasing land .

Zhang Yufan frankly stated, "This is an old problem in Thailand that has existed for decades." The only legitimate solution to own land is to obtain BOI (Board of Investment) approval or to set up a factory in an IEAT-regulated industrial zone. While the practice of Thai nationals holding land under false pretenses is tacitly accepted, it still carries high legal risks.

He advised companies to have lawyers design their corporate structure and articles of association to clearly lock control in the board of directors and decision-making levels, stating that " legality and compliance are always more worthwhile in the long run than cheapness. "

EEC: A Driving Force for the Eastern Economic Corridor

The Eastern Economic Corridor (EEC) covers the three provinces of Chachoengsao, Chonburi, and Rayong, and is a high-tech industrial corridor that the Thai government is focusing on developing.

The EEC aims to transform Thailand from a "manufacturing nation" into a "technology nation," targeting industries such as electric vehicles, green energy, smart electronics, and precision manufacturing . Companies that simultaneously obtain BOI (Business of Import) status and establish themselves within the EEC will be eligible for additional tax incentives, land rent reductions, R&D subsidies, and expedited import/export customs clearance .

Chang Yu-fan pointed out, "The EEC is particularly friendly to the electronics and automotive electronics industries, which is also the key reason why PCB manufacturers choose to locate here."

Factory setup process: Four steps, documents first

The process of setting up a factory in Thailand is relatively simple: first, land preparation is carried out, then a building permit is applied for, completion is reported, and finally a factory operation permit is applied for. Zhang Yufan emphasized that Thailand values compliance with results rather than process review ; drawings, reports, and acceptance are acceptable as long as they meet the standards. Within the IEAT industrial park, the management unit usually assists in compiling documents and communicating with supervisors; outside the park, it is necessary to proactively address environmental protection, water pollution, and local permits, and plan ahead to avoid delays in starting construction.

Differences between inside and outside the zone: Between stability and resilience

"In the industrial park, the rules are clear, people can come and go, and things are done quickly; outside the park, you have to coordinate on your own." Zhang Yufan said in a plain tone, explaining that although the rent for factory buildings outside the industrial park is slightly lower, you have to deal with inspections, communication and requirements from various departments on your own, which inevitably incurs costs of "small money and miscellaneous matters".

While the IEAT industrial park is strictly regulated, it ensures high standards for power supply, drainage, and safety inspections. For first-time investors, entering IEAT is the safest starting point!

Tax benefits: Not just the tax-free period, but also cash flow.

Many companies value the tax-free period of the BOI (Board of Investments), but overlook the timing of capital turnover and cash flow . Zhang Yufan points out: "What truly affects profitability is the cycle."

Duty-free raw materials combined with export tax rebates can effectively reduce operational pressure, but it still needs to be aligned with customs declaration and inventory cycles; corporate income tax reductions can improve the return on investment, but the timing of depreciation and capitalization amortization must also be considered.

He suggested that companies should conduct IRR, payback period, and stress tests in the early stages of planning to ensure that policy benefits are truly reflected in book profits.

From strategy to pace: Making rapid factory setup a reality

For Taiwanese businesses making their first foray into the South, the biggest problem isn't regulations, but the pace.

Zhang Yufan's suggestion is very pragmatic: "Draw three lines—the timeline, the funding line, and the capability line." When mass production milestones, financing plans, and supply chain capabilities are aligned, companies will naturally know whether to "rent first or buy first" and "build their own factory or share a factory."

Today, Thailand is no longer just a backup base, but the central hub of the entire ASEAN supply chain. "As long as the documents are in place, policies are aligned, and the pace is stable, 'move-in ready' is no longer just a slogan, but a replicable model."

Policy is the map, rhythm is the route.

The key to investing in Thailand lies not in luck, but in preparation. BOI offers incentives, IEAT guarantees stability, and EEC drives upgrades.

Based on years of observation, Zhang Yufan concluded: " Treating policies as maps, documents as road signs, and pace as schedules will make rapid implementation no longer a dream, but the next step in the internationalization of enterprises."

Essential links for setting up a factory in Thailand

BOI (Board of Investment) – Thailand's Board of Investment

Responsible for reviewing and approving foreign investment projects, and providing tax and factory establishment incentives.

🔗 Official Website: https://www.boi.go.th

IEAT (Industrial Estate Authority of Thailand)

It oversees industrial zones nationwide and provides land acquisition, environmental protection, and infrastructure services.

🔗 Official Website: https://www.ieat.go.th

EEC (Eastern Economic Corridor) Office

The Thai government is promoting a flagship region for high-tech industry clusters and infrastructure upgrades.

🔗 Official Website: https://www.eeco.or.th

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