BANGKOK, June 10 (Reuters) - The value of applications to invest in Thailand fell 42 percent in January-May, including a 10 percent drop in foreign bids from a year earlier, the Board of Investment (BOI) said on Tuesday, when the country suffered political unrest and a military coup.
Months of political unrest also hurt consumption and cut public spending. The army seized power on May 22 in a bid to restore order and business confidence.
The total value of investment applications fell 42 percent to 308 billion baht ($9.5 billion) in the first five months of this year from a year earlier, Udom Wongviwatchai, the BOI’s secretary-general, said in a statement.
Within that, foreign investment requests decreased by 10 percent to 230 billion baht, he said.
Investment requests from Japan, Thailand’s biggest investor, fell to 72.8 billion baht in the first five months, Udom said. He gave no comparison but the BOI website gave a figure of 168 billion baht for the same period last year, meaning requests had dropped 57 percent this year.
Over the same period, investment pledges from the European Union jumped 300 percent to 64.2 billion baht, while those from the United States surged 570 percent to 41.2 billion.
In the first five months, some 139 billion baht in investment applications came in from 10 big car firms wanting to make energy-efficient cars under a government-sponsored initiative.
Investment bids from Chinese firms increased 260 percent in the first five months to 9.4 billion baht, while those from South Korea rose 150 percent to 12.3 billion baht.
“The setting-up of a new BOI board should make reluctant investors more confident in requesting investment projects in the second half,” Udom said. A new board, which has to approve major investment applications, was formed recently.
“If the board can quickly clear the backlog of applications, it will be good for the economic outlook,” Udom added.
Last week, Air Chief Marshal Prajin Juntong, who is overseeing economic matters for the military government, said he expected that applications from local and foreign investors to invest more than $21 billion would be acted on within two months.
Processing of these applications was held up by the turmoil as the country was without a proper government from December until the army took control in late May.
$1=32.5 baht Reporting by Orathai Sriring; Editing by Alan Raybould and Jacqueline Wong