Why Choose Malaysia VS Thailand
Business Environment in Thailand
Thailand is the second largest economy in Southeast Asia, after Indonesia. However, it is only ranked fourth in the region, after Singapore, Brunei and Malaysia. The country enjoys a gross domestic rate (GDP) growth of about 4 – 5 per cent per year and is mainly driven by a strong automotive industry, while it is also a large exporter of rice and agricultural products. Thailand’s economy has in the past been affected by natural disasters and also political issues, but the country’s leadership hopes to move past these issues and rebuild the economy. Over the last few decades, Thailand has had strong growth and has reduced poverty substantially. In 2013, the Thai Government implemented a nationwide 300 baht (roughly USD$10) per day minimum wage policy and deployed new tax reforms designed to lower rates on middle-income earners. However, growth has slowed in the last few years due to domestic political turmoil and sluggish global demands. Nevertheless, Thailand’s economic fundamentals are sound, with low inflation, low unemployment, and reasonable public and external debt levels. Tourism and government spending – mostly on infrastructure and short-term stimulus measures – have helped to boost the economy, and The Bank of Thailand has been supportive, with several interest rate reductions.
However, despite all this, there are numerous considerations before one invests in Thailand.
Few Issues In Thailand
For one, the country faces a high exposure to China’s slowing economy and the ongoing insurgency involving ethnic Malay Muslim rebels in the South threatens to destabilise the region, if left unresolved. Also, inflation remains a major concern given the economy’s strong economic recovery, which could threaten consumer spending and political unity. Over the longer-term, Thailand faces labor shortages, and domestic debt levels, political uncertainty, and an aging population pose risks to growth. Although Bangkok is a highly developed city, many provinces have varying degrees of education quality and salaries. There is also the problem of the Thai culture in the workplace especially in government agencies needs a bit of cronyism to get ahead. Being smart is not enough, you need to know the ” right person” to help promote you. That’s why many young smart people prefer to work in public companies, multinational firms and some decide to leave Thailand to work abroad.
Many Advantages for Investor
Comparatively, Malaysia located at the heart of the region, making it an ideal gateway to access Asean’s population base of 600 million, provides a business-friendly environment to operate in. With a commitment to helping businesses flourish, the Government of Malaysia has put into place policies that encourage investments. The success of these policies is proven by its 3rd place ranking in the 2016 A.T. Kearney Global Services Location index and 4th place ranking on the World Bank’s Doing Business 2015 investor protection index.
As one of the most vibrant countries in Southeast Asia, Malaysia offers many advantages as an investments destination. This has been affirmed by robust growth in private investments in the country, which has expanded at a compounded annual growth rate of 13.9% from the start of the ETP in 2010 to RM146.1 billion (US$39.89 billion) in 2014. From manufacturing to distribution or technical expertise in the services sector, the country offers opportunities and capabilities across the value chain.
Myriad of Oopportunities
Whether investors want to utilise Malaysia as their target market or as a regional gateway, organisations and their employees alike will find a myriad of opportunities upon their arrival here. Starting a business in Malaysia only requires three procedures, 5.5 days and costs 7.2% of income per capita in fees , ensuring investors an efficient process when they choose to enter the market. This is compared to the East Asia and Pacific average of 7.3 procedures, 34.4 days and a cost of 27.7% of income per capita in fees.The Malaysian Government continuously strives to provide a business-friendly environment to operate in. These efforts have been affirmed by the likes of the World Bank, which ranked the country the 18th best place in the world to conduct business in its Doing Business 2015 report. The World Bank’s competitiveness criteria in the Doing Business ranking include ease of starting a business, licensing approvals, tax administration efficiency and ease of cross-border trading.