New Business registration in Thailand is rocketing

Image via WikipediaBANGKOK: -- New company registrations are expected to grow by more than 22 per cent this year on an influx of investment to Asia, especially to Asean, amid slow economic growth in the United States and the euro zone.


The Business Development Department yesterday reported that new registered companies grew sharply by 23 per cent from 2009 to 50,776 firms last year, the highest in 99 years. Combined investment capital rose 20 per cent to Bt263.82 billion.

The investment capital for existing firms also increased sharply last year, by 37 per cent to Bt603 billion, while the number of businesses shutting down operations dropped by 6 per cent to 16,004.

Deputy Commerce Minister Alongkorn Ponlaboot attributed increasing new-business growth to strong economic fundamentals, despite Thailand facing three negative factors: a fragile global economy, political unrest, and natural disasters.

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He said new company registrations should increase continuously this year on strong economic expansion. Investments from South Korea, Japan and China will benefit Thailand and other Asean countries, as the region has high potential to serve as a centre of manufacturing and trading.

Other factors that contributed to the growth of new businesses last year included recovering investment in the stock market, strong export growth, the government's investment under the Thai Khem Khaeng Project, and an increase in foreign direct investment.

However, six negative factors will affect new-business expansion this year, including a stronger baht, high interest rates, political uncertainty and the lead-up to the general election, the fragile global economy, higher inflation, and an increasing oil price.

Alongkorn said those factors would affect all business transactions, capital investment, and the establishment of new companies, as well as the collapse of others.

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New businesses that were registered last year were mostly involved in construction and property development, financial service, electricity supply, and hotels.

In December alone, new registered businesses rose 26 per cent to 3,112 companies with an initial investment worth Bt11.18 billion.