Current business situation
Historically, Thailand has demonstrated relative economic resilience in the face of political and economic upheaval and most businesses have carried on operations as usual. Thailand’s economy is heavily export dependent, with exports accounting for more than two-thirds of the country’s Gross Domestic Product (GDP).
A major factor affecting the country’s economy is the role of the four major economies in the world: China, Japan, the United States and the European Union. Japan is Thailand’s biggest investor.
Austrade focuses on opportunities for Australian businesses in the Thai market, especially those influenced by the following major trends:
- Increasing consumer affluence leading to greater demand for high quality goods and services.
- The country’s ongoing position as a regional manufacturing hub particularly in automotive, electronics and food processing.
- Greater focus and awareness in sustainability and the environment.
- Growth of Thai businesses in trade and investment into ASEAN.
- Greater urbanisation leading to demand of more and better infrastructure and transport projects
Australia's trade and economic relationship with Thailand has grown strong since the Thailand-Australia Free Trade Agreement (TAFTA) came into effect in 2005. TAFTA provides tariff advantages over European and North American competitors and allows many Australian companies to find new export opportunities.
Khun (pronounced koon, as in cook) is Thai for Mr, Mrs, Ms or Miss. When addressing others, Thais use Khun followed by a person's first (given) name. For example: Khun Somporn, Khun Mallee, or in a Western context Khun John (rather than Khun Smith). Most Thais also have a nickname, which may be used in place of their given name.
In general, Thai business people tend to follow a formal dress code. In business meetings a business shirt, tie and proper footwear (not sandals) are essential for men and formal dress codes applies for women too.
Casual wear should not be worn to business meetings.
Relationship building is an essential factor if you are to succeed in doing business in Thailand. Thais will generally expect to spend time building a relationship with their business contacts before they will exchange detailed information or commit to a deal. It is common to begin or wrap up business meetings with informal conversations. Your Thai counterparts may ask questions about your age, family and educational background in order to build familiarity with you.
The exchange of gifts is widely practiced in business dealings in Thailand and should be reciprocated. Gifts are given to those visited for the first time and signify friendship and an appreciation of hospitality.
Gifts are opened in privacy, not when received. Gifts do not need to be expensive but a generosity of spirit will help build a strong relationship with your partners.
Note: care should be taken when giving gifts that they are relatively modest and proportionate to the occasion. Expensive gifts may constitute an offence if given unnecessarily and with the intention to obtain or retain business or a business advantage.
Australian businesses should familiarise themselves with anti-bribery legislation. If the person is a Foreign Public Official (FPO) this act may be an offence under Australia’s anti-bribery legislation.
Setting up in Thailand
We strongly suggest that you seek professional legal and accounting advice prior to establishing a business in Thailand.
In many cases, a foreign entity cannot own more than 49 per cent of the enterprise, with the majority owned by Thais. However, exceptions for majority foreign ownership exist for certain types of industries and are often granted for projects approved by the Thai Board of Investment.
The Thai Board of Investment provides more detailed information about establishing a business in Thailand. Professional service firms also offer their own guides to setting up and doing business in Thailand.
For Australian businesses which operate in Thailand with a Thai Business License, opening a bank account can only be done in person and only at the head branches of Thai banks, most of which are located in Sathorn, Bangkok. Documentation requirements vary between banks.
Banking and finance
In general, the basic accounting principles practiced in the United States are accepted in Thailand, as are accounting methods and conventions sanctioned by law. Auditing practices conforming to international standards are, for the most part, recognised and practiced by authorised auditors in Thailand.
Information on accounting and financial reporting requirements for a business in Thailand is available in English from the Board of Investment.
Links and resources
Government, business and trade
ASEAN Supporting Industry Database: Gateway to ASEAN Suppliers
Australian-Thai Chamber of Commerce
DFAT Thailand Country Brief
Ministry of Commerce
Ministry of Finance
Ministry of Industry
Thailand Board of Investment
News and media
Please note: This list of websites and resources is not definitive. Inclusion in this list does not imply endorsement by Austrade. The information provided is a guide only. The content is for information and carries no warranty; as such, the addressee must exercise their own discretion in its use. Australia’s anti-bribery laws apply overseas and Austrade will not provide business related services to any party who breaches the law and will report credible evidence of any breach. For further information, please see foreign bribery information and awareness pack.