The South East Asian countries make up the biggest exporters of natural rubber in the world. We can see the use of rubber in hundreds of daily commodities around us every day. From the wheel of our cars to the shoes we wear, we can find rubber in so many products. Therefore, you can understand how important a role natural rubber plays in our lives. In today’s market, there are two main kinds of rubber available – natural rubber and synthetic rubber. Natural rubber is made out of the juice or latex of the rubber tree itself on the other hand synthetic rubber is made with the help of petroleum. So as a result, when the price of petroleum rises, the demand for natural rubber increase and the vice versa, when there is disruption in natural rubber prices, the people look for synthetic rubber.
Thailand, Malaysia and Indonesia are the top three natural rubber exporters in the world. But recently, the International Tripartite Rubber Council (ITRC), have signed and agreed to cut the natural rubber exports. They have stated 200,000 to 300,000 metric tons will be reduced to highlight the “prevailing depressed NR price level”. On February 21, 2019, the ministers of all the three countries came together and agreed to sign the treaty in front of an international panel. So today we will be discussing what is the impact of this decision by ITRC and different other aspects.
As we mentioned above, Thailand, Malaysia and Indonesia are the top exporters of natural rubber in the world. Setting up a business in Thailand of rubber production, it may be difficult but really profitable. Among the three countries, Thailand supplies with the largest amount of natural rubber to the world. Based on natural rubber, the country also has a huge production of synthetic rubber as well. In Thailand, there is a strong and efficient rubber production lineup which helps to manufacture several values added rubber products. Therefore it offers significantly greater chances and opportunities for the production of different varieties of rubber products or even the raw material.
The top 5 exporters of Thailand’s rich natural rubber include China, Malaysia, Europe, Japan and South Korea. Other than Thailand, Indonesia and Malaysia also have a good amount of export levels to the world. Even though Thailand has more than 35% of the total market share in the export of natural rubber, Indonesia also has a significant share of around 31% and Malaysia has 7.4%. So you can see that combining the world export % of these three countries they have contributed to almost 70% of the total manufacture of rubber in the world. The economies of all these three countries depend on the export and business of rubber throughout the year.
However, in the last couple of years, there has been a dramatic fall in the price of products which are made of rubber exports. Due to different government policies and regulations, demand and prices of export rubber decreased massively. Therefore anyone who is doing business in Thailand related to rubber products or exports must have a hard time a couple of months.
Earlier, like 2-3 years back the prices of latex rubber price was increased in a continuous manner. The three countries – Thailand, Malaysia and Indonesia were flourishing with natural rubber exports and it’s revenue that helped to strengthen their economy significantly. These figures gave the farmers great encouragement to plant and grow more rubber. Many of them also took certain measures to grow rubber plant even on unsuitable land. Many people started doing rubber business in Thailand and some even went to the extent of selling or totally converting their rice or paddy fields into rubber plantations.
Till 2012, the price of rubber was significantly high than where it is today. But all these unchecked and unauthorised measures lead to the oversupply of the product by huge margins than the original demand. In 2016, it was found that the numbers for the oversupply of rubber than the actual demand was staggering. As a result, the demand got easily fulfilled and the need for so much of commodity was not required. Many businesses faced huge losses and even innumerable independent rubber manufacturers are still trying to run a revenue with great hassles.
Therefore, to curb this problem the International Tripartite Rubber Council (ITRC) decided to reduce the number of exports almost 3 times for the coming few months of 2019 unanimously. Even though this problem can be solved in the course of a long time, at this current point there is nothing much to be done about the crisis. There are many sections of the people who actually blame the government to allow such unchecked businesses to set up and deal with rubber which leads to a dysfunctional business structure.
In 2017, Maierbrugger it was published in a report that the government of Thailand is planning to launch a project which has been named as the “Rubber City”. The main idea is to prevent the falling of the prices in the rubber market, at the same time control the manufacture and export of rubber good, products and various other items. This will prevent a crisis of this sort to be avoided in the future. Here are the major aims and objectives of this new project.
● To maintain a commercial hub and a centre which will only deal with rubber innovations and other industries which will grow in and around here.
● To attract investors and startup enterprises, to come and for starting a small business in Thailand. This will help the area to become more developed.
● This idea will make more jobs and opportunities for people to work and get employed at various companies and agencies.
● The formation of the Rubber City will also lead to the overall increase in the internal production of rubber. Therefore the sales and revenue will be much stronger and stable than before.
The project of Rubber City seems to be a promising solution to the natural rubber crisis in Thailand, Malaysia and Indonesia. The Industrial Estate of Authority of Thailand (IEAT) has authorised the Southern region of Thailand which is close to the border of Malaysia to start working on this project. Starting a business in Thailand when the Rubber City is finally completed, you will need to analyze the situation and check the demand of that area.
In 2019, the International Tripartite Rubber Council (ITRC) has taken a solid stance and necessary one, to address the growing issue of the decrease in rubber export and demand of the South East Asian countries. Due to such a step, there is a huge and promising chance for the countries and especially Thailand to recover from this economic scenario. You can get to know more about this incident on the news or papers which will help you to get clear ideas and updates about the various aspects of the natural rubber exports and demand in the world. Also, don’t forget to check all thes sections of our article.
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Source: Asian Correspondent
Thailand is one of the most stable and promising economies in the South East Asia region. Over the years the Thailand government and their people have been working hard to establish Thailand as one of the top developing powers in this region of the world. It surely has achieved a lot of success and prosperity as a result and will continue to do so. Even though Thailand is still behind many of the other countries in the same region like Malaysia and Singapore, it is surely reaching new heights every year.
In the span of a few years, Thailand has attracted a huge direct foreign investment which has provided a significant boost to the economy. Tourism, real estate, mining and construction, etc. are some of the most prospering industries in this country. The government has also invested a lot in these areas which allow the country to achieve even greater things in the future. If you are planning to start a business in Thailand then you have a lot of options to choose from.
Today we will be discussing the real estate market that is prevailing in Thailand in 2019. We have mentioned some very important points to remember before investing in this foreign country. Also, in this article you will find why you have a huge scope of making profit and we are going to kick start our article by discussing those points in the next segment.
If you are interested in the Thai real estate, then there are key aspects which you should be well aware of before investing in this foreign country. The real estate market in Thailand may seem to be much more lucrative than several other real estate sectors in the European countries and there are several reasons to support it. Let us have a look at some of the benefits of starting a business in Thailand, especially in the real estate market.
Excellent Ecology – the Thai real estate attracts huge foreign investment because of a good ecology that is available here. Places like Phuket has some of the most attractive offers when it comes to real estate. It has some amazing natural surroundings which include a diverse range of flora and fauna. This makes the area more lucrative for holiday homes, resorts and hotels. The Thai government has paid huge attention to the natural conservation of most of the parts of Thailand. That is why tourism has sprung up so much in the span of a few years. Therefore, as a result, the real estate sector has benefited a lot. The country experiences a tropical climate through most part of the year which makes it even more lucrative for real estate investors to purchase a property here. Tourists from all over the world visit here to enjoy this weather and spend some luxurious holidays very often.
Developed Infrastructure – Thailand has an excellent infrastructure and you can easily notice that by visiting any part of the country. Tropical beach resorts, luxury hotels, apartments, high rises, top-notch medical institutions, schools, recreational centers attracted huge attention not only at the national but also international levels. The unique and exquisitely designed buildings, hotels and malls provide an excellent opportunity for the people to improve their living standards throughout the year. So when you invest in a real estate property in cities like Bangkok, there are high chances that most of the time prole will be interested in your property because of the excellent infrastructure surrounding it. A country which promises a good and comfortable lifestyle, the real estate market prevailing there tends to be more prosperous.
Rising Middle-class – one of the driving factors for the huge potential in the real estate business in Thailand is the rising middle class. The people who belong to the middle class in Thai society are slowly but steadily trying to improve the quality and comfort of their housing. That is one of the biggest reason why, for instance in Bangkok, property prices have seen such rapid growth in the past few years. People are also interested to provide a good amount of rents to for living in apartments and high rises that are established around day-to-day amenities.
Affordable price – there are many cities and tourist locations in Thailand where you can purchase a real estate property at a reasonable price. You can reach out to a number of companies in the country which will help you to find a suitable property for purchase or rent. They also provide legal support and help you to set up your setting up a business in Thailand if you opt for their services. Therefore, if you can get hold of an affordable property in Thailand with the help of such a company, then you have a huge prospect of revenue and profit in the near future.
So you can see that investing in the real estate market in Thailand surely has some amazing benefits that you can cultivate upon. Every year this sector is growing and promises new opportunities to the people to prosper.
Thailand has a huge real estate market growth waiting to be nurtured even more. If you are really looking forward to earning a fortune in the Thailand real estate market, then you must consider these few things before investing.
Research about Thai condos – there some government imposed restrictions on purchase of property in Thailand as a foreigner. Therefore you can research about condos or apartments. Unlike a plot of land, you can own 100% of a condo or an apartment in Thailand. This is probably one of the easiest ways of owning a property in this country. This has been backed by the 1979 Thailand Condominium Act which state that as long as the main building is owned 51% by a Thai citizen, a foreigner can own 100% of the condo.
Getting a loan – when you are planning to buy a property in Thailand, you will require a loan. In a general perception, it is fairly difficult to secure a loan from a Thai bank for foreigners. But not impossible. With a bit of patience a determination in,, you will be able to get enough backing for doing business in Thailand in the real estate market. Remember that if you do not have any prior history of working or even living in Thailand, then it is a better option to take the loan in your own country. When the property is going to be declared under a foreigner’s name, the money needs to come from the overseas country for conversion.
Zero Property Charges – Yes! You read that absolutely right. Unlike many other countries, Thailand does not impose any proper taxes. It is absolutely zero. Foreigners who own a condo, for instance, do not have any property taxes applied to their purchase. The owner of the main building the one who will be responsible for the tax. But there are other taxes that you need to clear, for example, while selling your property you will have to clear the transfer fees, documentation fees, etc. But the main advantage that you get is the zero property charges.
So here are some of the key points that you should remember always before you invest in the real estate market in Thailand. The Thailand real estate market has a huge potential to grow in the future and has already shown promising numbers in recent years. But the market is volatile as well and that is why every decision you take needs to be accurately planned and strategized.
If you are planning to invest in the Thailand real estate market then it is important that you consult different professional startup consulting firms. Before you plan and strategize all your business plannings, it is very crucial that you know about the laws, legal aspects and various other things of the country. So if you think that you will not be able to tackle so many things at once, you will need to consult all these vital points with a Thai real estate agency.
Taking suggestions and advice from real estate consultants provides you with much better decision making abilities. You will be able to carry out all the transactions and deals in the real estate sector without any hassles. One of the biggest benefits of consulting such an agency is to get hold of some reasonable and strategic real estate locations in different parts of Thailand.
Final Words – the Thailand real estate market is attracting lots of foreign and national investments. People are showing a huge interest in investing their money at various locations of the country. Thailand is strategically located and provides amazing benefits to real estate investors. But before you invest the money in this market, there are some points which you should remember as well. We have discussed them thoroughly in this article and you should give a close read to all of them.
The post 2020 – What is the Real Estate Scenario In Thailand appeared first on StartUp in Thailand logo.
Source: Asian Correspondent