Thailand’s economy has been performing well since the early 1980s. It is now the second biggest in Southeast Asia, only trailing Indonesia. This solid growth has transformed the country from an agricultural society into an industrialised nation.
A quickly evolving Asian hub
In the past few years, Thailand has become an interesting market for investments by foreign businesses. In addition to a lucrative domestic market, Thailand also enjoys a strategic location in the middle of Asia and functions as an important centre for the entire region. The technology-driven manufacturing sector contributes significantly to Thailand’s GDP. Moreover, the continuous infrastructure investments, a growing middle-class consumer market, and a favourable business climate create plenty of opportunities for Swedish businesses.
The retail industry is developing at a fast pace, driven by e-commerce, economic development and the increasing population. As mentioned in the interview below with Carl Lindwall, it is also Thailand's ambition to become a world leader in the Internet of Things. This creates opportunities for Swedish companies in the telecom industry. Other promising industries are healthcare and renewable energy.
Potential growth for Swedish companies
Sweden has a long trade tradition with Thailand that goes back more than 100 years. Swedish export consists primarily of telecommunication equipment and engineering products such as machinery and equipment, paper products, transport equipment, and steel and forestry products. Still, export to Thailand is rather modest, which leaves a lot of untapped potential for further growth. Today, around 70 companies from or related to Sweden are active in Thailand.
How we can help
Business Sweden has been present in Thailand since 2008, offering Swedish companies strategic advice and operational support when entering the Thai market. Our Bangkok office also covers other countries in the emerging Mekong region such as Myanmar, Cambodia and Laos.
Carl LindwallActing Country Manager Thailand
What are the main advantages for expansion in Thailand?
In addition to a lucrative domestic market, Thailand has a strategic position on the world map and serves as a business and start-up hub for the region. The increased investment in infrastructure, digitalisation and a shift in demographics also create a need for innovation and advanced technological solutions. Given the increasing middle class and ageing population, there is also potential in the healthcare sector and a growing market for medical tourism. The country also has ambitious aspirations to become the regional centre for the Internet of Things.
What are the risks and challenges companies may face in Thailand?
Thailand is a relatively stable and mature country to do business in, but this can be affected by geopolitical tensions in the region. Although the country has improved in terms of easiness to do business, there is still a lot of bureaucracy, which can be challenging when setting up a subsidiary. The most common challenges that Swedish companies face is related to price sensitivity, competition and finding skilled staff. Corruption and political uncertainty should also be taken into consideration. Mastering this requires a solid strategy, a thorough understanding of the market, a unique offering, and a strong local network.
Are there any cultural aspects to consider?
A real asset for doing business in Thailand is local presence; staff or partners who understand the culture and master the language. This allows businesses to acquire in-depth market knowledge and to create a relevant, customised offering for the Thai market. Business culture is all about relationship building and customers want regular face-to-face interactions.