Thailand’s growing consumer market and overall investment climate are driving the expansion plans.

The HSBC-commissioned report by the Singapore Business Federation sought the insights of 1,036 Singapore-based companies on their interest in overseas expansion. Around 86 per cent of those surveyed were considered small- or medium-sized enterprises (SMEs), defined as those with an annual turnover of S$100million or fewer than 200 staff.

Thailand is a popular destination for internationally oriented Singapore-based companies expecting to expand. 

Of the surveyed companies, 80 per cent said they already had operations in Thailand, the highest except for Malaysia at 87 per cent and Indonesia 81 per cent, and 29 per cent expect to further expand there in the next two years, behind only Indonesia, Malaysia and Vietnam.

Increased trade and investment from Singapore is good news for Thailand given Singapore is already Thailand’s third largest source of investment behind China and Japan. 

In 2017, Singapore invested US$4.3 billion into Thailand compared to $9.5 billion from Japan and $7.4 billion from China, according to the Bank of Thailand.

Singapore’s inbound investment into Thailand includes companies founded in the city-state as well as many international firms. Of the 37,400 international companies in Singapore, 7,000 are multinationals and 60 per cent have regional responsibilities.

Krisda Phatcharoen, head of commercial banking at HSBC Thailand, said: “Whilst Thailand’s growing consumer base is already well recognised by Singapore corporates, the report shows that many businesses are looking to double down on our demographic dividend.

“Beyond the consumer piece, Thailand’s manufacturing – whilst already strong – is now entering into the higher-end space. So while many corporates may base their treasury and other back-office functions in Singapore, a lot of revenue-making operations are being driven out of Thailand. This is only expected to ramp up with Thailand’s widening along the supply and value chain.”

Source: http://www.nationmultimedia.com/detail/Economy/30351381