BANGKOK – Thailand is poised to benefit from a strategic move by the United States to diversify semiconductor production, according to U.S. Commerce Secretary Gina Raimondo. Speaking in Bangkok, Raimondo highlighted the readiness of American firms to ramp up investments in the Southeast Asian nation, signaling a significant opportunity for Thailand’s economy.
The electrical and electronics industry holds significant appeal for foreign investment in Thailand, and it remains a focal point for Prime Minister Srettha Thavisin’s administration as it aims to stimulate economic growth.
Raimondo emphasized the risks associated with semiconductor production being heavily concentrated in just a few countries worldwide. To address this, the United States is looking to channel additional investments into countries participating in the Indo-Pacific Economic Framework (IPEF), which includes Thailand among its 14 members.
Highlighting the collaborative nature of this effort, Raimondo stressed the mutual benefits for the United States, Thailand, and other IPEF countries in diversifying the semiconductor supply chain.
The “Chips and Science” law passed by the U.S. in 2022 allocated $52.7 billion for semiconductor production, research, and workforce development, indicating a firm commitment to bolstering domestic capabilities.
Thailand’s semiconductor industry, primarily driven by companies from the U.S., Japan, Korea, and the Netherlands, is currently centered on the back-end process, placing it on par with Vietnam and India, as per a 2023 report by Siam Commercial Bank.
The geopolitical shifts in global manufacturing have led to the relocation of semiconductor production facilities to Thailand, further enhancing its position in the industry, according to the report.
To attract more investments into the semiconductor sector, Thailand’s Board of Investment is providing incentives such as tax breaks and duty exemptions.
As U.S. companies seek to diversify their supply chains, Thailand emerges as a preferred destination, noted Raimondo, underscoring the nation’s attractiveness for multinational corporations.
Raimondo’s visit to the Philippines earlier in the week saw announcements of U.S. investments exceeding $1 billion, covering sectors like solar energy, electric vehicles, and digitization, reinforcing the commitment to strategic partnerships in the region.