Thai DPM Pichai courts global funds to reignite stock market, eyes investment reforms

The Star

27-05-2025

BANGKOK: Deputy Prime Minister and Finance Minister Pichai Chunhavajira (pic) revealed that the Thai government is in talks with major international investment funds to attract more capital into the Thai stock market, particularly as the SET Index lingers at the 1,100–1,200 level, which he said is increasingly appealing to investors.
Speaking during a keynote address at the Daily News Talk 2025 seminar, themed 'The Charm of Thai Stocks: Driving the Economy,' Pichai noted that large institutional investors, many of whom have historically allocated significant portfolios to Thailand, have shifted more capital overseas in recent years. However, these funds still maintain investments worth hundreds of billions of baht in Thailand—mainly in government bonds.
Although returns from foreign investments have been solid, recent volatility in global markets has prompted investors to reassess. Pichai said investors are starting to see that Thai stocks have declined significantly, and are re-evaluating asset allocations and regulatory conditions that could support a return to Thai equities.
Pichai assured that the government is prepared to revise regulations to make the Thai capital market more attractive. This includes restoring investor confidence and reforming capital market laws, such as the soon-to-be-enforced Securities Oversight Act, which will impose civil and criminal penalties for naked short selling.
These legal changes, he said, are part of broader efforts to strengthen the Thai economy and position it for long-term growth, while large corporations have suggested aligning structural reforms with global trends, such as green economy and ESG practices.
'I have spoken with several funds about new investment policies. With the Thai stock index at this level, many see an opportunity. Thai equities still have appeal, especially for those who understand the fundamentals,' Pichai said. 'Thailand is viewed as a safe haven—but most investors are in a 'wait-and-see' mode. They have not left; they are watching what we do next.'
When asked about the relatively slow shift from long-term equity funds (LTFs) to the new Thai ESGX funds, Pichai acknowledged that investors are still highly liquid and likely weighing the right timing for reallocation.
On the strong baht, Phichai attributed the currency's rise to recent capital inflows, though he cautioned that much of it may be short-term investment in bonds, rather than equities, which are more sensitive to economic sentiment and structural reforms.
'Bond investments offer immediate returns and safety, unlike equities which require more confidence in Thailand's short- and long-term economic strategy,' he explained, adding that fund allocations could shift to equities once economic conditions improve.
Regarding broader investment incentives, Pichai noted that foreign investors are showing increasing interest in relocating production to Thailand. The government is working to support domestic manufacturing and employment, while upgrading workforce training—with a particular focus on linking labor to research sectors.
On land use reform, the government is currently amending laws to allow long-term leases of state land for up to 99 years—returning ownership to the state at term's end—rather than requiring investors to buy land through the BOI (Board of Investment). These efforts will be paired with enhanced access to utilities such as water and electricity.
On the use of cryptocurrency for retail payments, Pichai clarified that the discussion focuses on enabling crypto transactions via credit cards accepted by merchants—not tied to domestic currency. This model is under consideration by the Bank of Thailand, referencing global practices in crypto-based payment systems. - The Nation/ANN