Thailand’s Deputy Prime Minister and Finance Minister, Pichai Chunhavajira, announced that the government is in active talks with major international investment funds to increase capital inflows into the Thai stock market, particularly as the Stock Exchange of Thailand (SET) index hovers between 1,100 and 1,200 points. This level, he emphasized, is becoming increasingly appealing to investors.
Speaking at the Daily News Talk 2025 seminar, Pichai acknowledged that large institutional investors, many of whom had previously allocated significant portfolios to Thailand, have been shifting a portion of their funds overseas in recent years. However, he pointed out that these funds still maintain substantial investments in the country, primarily in government bonds. The seminar was titled “The Appeal of the Thai Stock Market: Driving Economic Growth.”
Despite solid returns from foreign investments, Pichai noted that recent global market fluctuations have prompted investors to reevaluate their strategies. He observed that many are now noticing the significant decline in the Thai stock market and are reconsidering their asset allocations and regulatory conditions that could support a return to Thai equities.
Regulatory Reforms to Enhance Capital Market Appeal
Pichai assured attendees that the government is preparing to introduce regulatory amendments designed to make Thailand’s capital market more attractive. Among the planned reforms are efforts to restore investor confidence and update capital market laws, including the Securities Supervision Act. This new law will impose both civil and criminal penalties for naked short-selling.
He explained that these changes are part of a broader effort to fortify Thailand’s economic foundation and ensure long-term growth. Pichai also noted that large corporations have suggested aligning structural reforms with global trends, such as the green economy and Environmental, Social, and Governance (ESG) practices.
“I have discussed new investment policies with several funds. With the SET index currently at these levels, many view it as an investment opportunity. The Thai market remains attractive, especially for those who understand its fundamentals,” Pichai remarked. “Thailand is seen as a safe haven, but most investors are in a ‘wait-and-see’ mode. They haven’t left; they’re simply waiting to see what our next steps will be.”
Shift from LTF to ESGX Funds
Pichai also addressed the transition from Long-Term Equity Funds (LTF) to the newer Thai ESGX funds, acknowledging that the shift has been slower than anticipated. He conceded that investors are still in a fluid state, likely awaiting the right moment to realign their investments.
On the topic of the strengthening Thai baht, Pichai attributed the currency’s appreciation to recent capital inflows. However, he cautioned that much of these inflows could be tied to short-term bond investments rather than stock investments, which are more sensitive to the economic outlook and structural reforms.
“Bond investments offer immediate returns and security, while equity investments require greater confidence in Thailand’s economic strategies, both short-term and long-term,” he explained. “Once economic conditions improve, we expect fund allocations to shift more towards equities.”
Incentives to Boost Industrial Investment and Workforce Development
Pichai also highlighted the growing interest from foreign investors in relocating production to Thailand. He revealed that the government is focused on supporting domestic manufacturing and job creation while also upgrading workforce training programs, particularly by connecting labor with research sectors.
Regarding land use reforms, the government is amending laws to allow long-term leases of state-owned land for up to 99 years. At the end of the lease term, ownership would revert to the state, eliminating the need for investors to purchase land through the Board of Investment (BOI). These changes will be accompanied by improvements in public utilities, such as hydropower, further enhancing Thailand’s appeal as an investment destination.
Exploring Cryptocurrency for Retail Payments
On the topic of cryptocurrency use in retail payments, Pichai clarified that discussions are centered on enabling crypto transactions via credit cards accepted by merchants, without being limited by the national currency. The Bank of Thailand is reportedly considering this model, drawing inspiration from global cryptocurrency payment systems.
As the Thai government continues to implement strategies to attract international investment and modernize its financial and regulatory systems, Pichai’s comments reflect the government’s commitment to creating a stable and dynamic economic environment that responds to both global trends and local demands.
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