Thailand to open up logistics sector to increased foreign ownership

Good news for Thailand, who has ambitions on becoming a Southeast Asia logistics hub, and good news for foreign operators of logistics and freight service companies in Thailand:

Under the Asean Economic Community (AEC) plan, Thailand is set to raise its 49% ceiling on foreign ownership of logistics service operators to 51% in 2011 then to 70% in 2013.

Logistics is among 12 priority areas for Asean integration, along with sectors such as automobiles, electronics, agro-based products, fisheries, air travel, tourism, textiles and clothing, and health care.

”After discussion with the private sector, we agree that Thailand is poised to reap benefits from higher regional trade under the AEC if logistics is liberalised,” said Mr Siriphol.

Chackrit Duangphastra, director of the Service and Investment Negotiations Bureau, said Asean aims to strengthen economic integration through liberalisation and facilitation measures in logistics services by 2020.

Singapore, Laos and Cambodia already allow 100% foreign ownership of logistics-related business. Thailand allows foreigners to hold 100% only of freight service providers, but this is subject to the ministry’s approval on a case-by-case basis, he said.

Mr Siriphol added that Thailand has the potential to become a regional logistics hub given the development of more transport routes.

”Our vision is for Thailand to emerge as a country with logistics entrepreneurs and infrastructure of an international standard,” he said.

Hat tip to World Trade Magazine.