OPPORTUNITIES IN THAILAND’S PRINTING

INDUSTRY

Investment Promotion Strategies

Value Creation

Developing primary industriesDeveloping primary industriesPetrochemical, metal, alternative energy, Petrochemical, metal, alternative energy,

NGV, logistics, public transportationNGV, logistics, public transportation

Increase potential and solve problems of Thai industries R&D, technology & machinery Improvement, Energy saving, IT system

Future Important Future Important IndustriesIndustries

• Networking w/ Science Park /universities• Hi-tech Industries• Bio- tech products, R&D contracting• IC design & wafer• Nano Technology

Overseas Thai Overseas Thai InvestmentInvestment

• ChinaChina , CLMV , CLMV • Cooperate with Cooperate with allies inallies in

- - market market expansionexpansion

- raw materials - raw materials sourcingsourcing

- - cost reduction cost reduction & capability & capability enhancementenhancement

Target Industries• Agriculture New products, High value added, Ready to eat • Fashion

OEM ODM & OBM• Automotive – no. 9 ranking• Electronics and ICT

Cluster upstream-downstream • High-value- added services

IPO BPO ROH

Science & Knowledge Based

Value Chain

1

2Missing Links

(Forward & Backward)• Production of printing machinery

3

High V.A• Books, high-quality printing

such as special papers

• High-quality packaging such as special papers, paper packaging for liquid food, paper for checks

4

Ind

ustr

y &

Serv

ice

Strengthening

Value Creation Strategies for Printing Industry

Existing

Existing New & Cluster

Thailand’s Printing Industry• Thailand’s Pulp & Paper industry - #2

in Southeast Asia• Capacity ~ 4 million tons• Exports ~ 30%• Variety of products and special

specifications

Ink Industry in Thailand• Able to produce all types of products

for web-offset printing, gravier printing, flexo printing, etc.

• More than 3,500 printing factories, but missing large, modern factories– Need high speed printers– Few commercial web offset printers: <

10

Printing Factories• More than 3,500 printing factories• Thailand still missing large, modern

factories– Need high speed printing factories– Few commercial web offset printers: < 10

• Some relocations to Thailand:– Rotosiam– Alppe Asia from France

Opportunities in Mechanical Engineering Industry: Top 20

products

Source: Investor’s Guidebook” Dec. 2003 (Asia-Invest Study)

Printing machinery Bearings, spherical roller

Parts of printing machinery Poultry-keeping machinery

Industrial machinery for food, drink preparations

Machine tools for stone, ceramics, cold glass

Treatment by temperature change Sawing mach. for wood, cork

Parts of spinning, combing, drawing machines

Air compressors mounted on wheeled chassis for towing

Self-propelled works trucks, non-electric Machines, confectionery, cocoa, chocolate manufacture

Rubber or vacuum moulders, thermo formers

Mach. to fill, close, aerate, … bottles, containers

Cranes & lifting frames Chain saw parts

Condensers for steam/vapor power Parts of refrigerating/freezing equip

Mach. for pulp, paper or board Parts of power transmission equip.

Criteria and Conditions for Project Approval

Criteria•Value added

•D/E ratio

•Modern technology

•Environmental protection

Conditions•ISO 9000

•Performance- based

•Cap on corporate tax exemption (equal to investment capital)

BOI Zone Incentives

3 Investment Promotion Zones

Basic Zone-Based Corporate Income Tax Exemptions

*Laem Chabang IE and Rayong IE receive 8 years

8 Years (regardless of location)

Zone 3

3 Years*7 YearsZone 2

Not Exempt3 YearsZone 1

Outside IEInside IEZone

Import Duty PrivilegesZone Machinery

Import DutiesRaw Materials Import Duties

1 50% Reduction 1 Year

Exemption

2 50% Reduction(100% in industrial estates)

1 Year

Exemption

3 Exempt 5 Year

Exemption

Additional Zone 3 Incentives

25% deduction of infrastructure installation or construction costs

Double deduction of water, electricity, transport costs for 10 years

50% reduction of income tax for 5 years

Outside Industrial Estate

Inside Industrial Estate

36 provinces

Additional Zone 3 IncentivesAdditional Zone 3 Incentives Additional Zone 3 IncentivesAdditional Zone 3 Incentives

25% deduction of infrastructure installation or construction costs

Double deduction of water, electricity, transport costs for 10 years

50% reduction of income tax for 5 years

Outside Industrial Estate

Inside Industrial Estate

22 Least Developed Provinces

4 provinces added: ChaiyapumNong KhaiUbon RatchathaniUdon Thani

Pulp & PaperProduction of packaging material of food

packages: • Priority activity• 8-year corporate income tax holiday

Manufacture of:• Fiber, pulp or paper, paperboard articles• Paper containers or boxes• Abrasive paper• Stationery or parts

Special Incentive Packages for Cluster Development

Agro-Industry

Automotive

Integrated Electronics

Printing

Jewelry

Film & multimedia

Printing Industry Cluster: 1. Printing Industrial Estate

Developers Criteria:

Must provide Press and machine maintenance services Training center 24-hour distribution centerPublic utilities & services (see Activity 7.5.1 Industrial Zones)

Incentives: 8 years corporate income tax holiday (not limited to

amount of investment) Exemption of machinery import duty

Printing Industry Cluster

Incentives: Within promoted printing industrial estate:

Duty free machinery

Corporate income tax holiday:Zone 1: 5 yearsZone 2: 7 yearsZone 3: 8 years

Relocation to printing IE, even if in same zone 8 years corporate income tax holiday Zone-based machinery duty reductions

Outside promoted printing industrial estate: Standard incentives according to zone

Printing Industry Cluster: 2. Printing-Related Activities

Sinsakorn Printing Industrial Estate

The Printing City• Location Samut

Sakhon• Full for past 2 years,

but is in process of expanding

Developer: C.A.S. Printing City Co., Ltd.