WORLD TRADE  
ORGANIZATION  G/SCM/N/114/THA 
6 July 2004 
 (04-2909) 
Committee on Subsidies 
and Countervailing Measures Original:   English 
 
SUBSIDIES  
 
Extension Under SCM Article 27.4 of the Transition Period for the  
Elimination of Export Subsidies Pursuant to the Procedures  
in Document G/SCM/391 
 
Updating Notification  
 
THAILAND 
  The following communication, dated 2 July 2004,  is being circulated at the request of the 
Delegation of Thailand. 
_______________ 
 
 Thailand is pleased to inform the Committee on Subsidies and Countervailing Measures (the 
SCM Committee) that Thailand’s Export Market Diversification Promotion Programme, notified 
herein as item III: Export Market Diversification Promotion Programme, has been terminated since 
31 December 2003 in accordance with Article 27.4 of the Agreement on Subs idies and Countervailing 
Measures (SCM Agreement).    Furthermore, as notified in G/SCM/101/Suppl.1 and G/SCM/101/Suppl.2, since 1 January 2003 Thailand has eliminated the export requirement for the Export Processing Zone, which 
is notified herein as part of item VI:  Industrial Es tate Authority of Thailand.  Regarding the current 
status of the legislative amendment of the IE AT Act as per the workplan submitted to the SCM 
Committee in G/SCM/101/Suppl. 1, the Office of the Council of State is currently verifying the bill proposed by the Cabinet, and upon completion of verifi cation, will return it to the Cabinet for review.  
  Because Thailand’s export subsidies under th e Export Market Diversification Promotion 
Programme and the Industrial Estate Authority of Thailand have been eliminated, there now remains 
only one
 of the three export subsidy programmes for wh ich Thailand requested an extension of the 
transition period for the elim ination of export subsidies2, which is the Board of Investment (BOI) 
Programme, notified herein under item I: Investment Promotion Incentives.  As previously notified by 
Thailand via various documents such as G/SCM/N/71/THA, G/SCM/N/71/THA/Suppl.1, 
G/SCM/Q3/THA/7,  G/SCM/Q3/THA/10, G/SCM/Q3/THA/17, G/SCM/Q3/THA/20, 
G/SCM/Q3/THA/23 and G/SCM/N/99/THA dated 23 July 2003, as well as via several consultations between Thailand and the SCM Committee and member s thereof, Thailand has satisfied the standstill 
requirement and is undertaking the phase-out and e limination requirements contained in G/SCM/102 
for the BOI Programme.  For the year 2003, 40 projects receiving export subsidies were eliminated, so 
that by the end of 2003, only 118 of the 158 projects notified for the year 2002 remained.
3  I n  
addition, 24 projects were eliminated during the first half of 2004, so that currently only 94 projects remain.  
                                                     
 
1 This notification, in particular the relevant s ections of items I and VI, also satisfies the annual 
transparency and notification provisions contained in G/SCM/101 and G/SCM/102. 
2 See G/SCM/N/74/THA. 
3 See G/SCM/N/95/THA and G/SCM/N/99/THA dated 23 July 2003. G/SCM/N/114/THA 
Page 2  
 
  
TABLE OF CONTENTS
 
Page  
 
I.      INVESTMENT PROMOTION  INCENTIVES ...................................................................2 
II.      CREDIT REFINANCING SCHEMES..................................................................................5 
III.      EXPORT MARKET DIVERS IFICATION PROMOTION PROGRAMME ...................6 
IV. MERCHANT MARINE FINANCING ...................................................................................8 V. MACHINERY UPGR ADING FINANCING .......................................................................10 
VI. INDUSTRIAL ESTATE AUTHO RITY OF THAILAND (IEAT).....................................12 
 
I. INVESTMENT PROMOTION INCENTIVES 
1. Title of the subsidy programme 
 
 Investment Promotion Incentives 
 
2. Period covered by the notification 
 
 1 January–31 December 2003  
3. Policy objective and/or purpose of the subsidy 
 
 Investment promotion incentives aim at pr omoting the establishment of industries and  the 
strengthening of technological capability in Thailand to accelerate the country’s industrialization process and encourage regional development.   During recent years, investment incentives have been 
geared towards decentralization to address the on- going development disparities between the urban 
and rural areas in accordance with the Thai Govern ment’s policy theme of regional development.   
 
4. Background and authority for the subsidy 
 
 The legal basis of the investment promoti on incentives is the Investment Promotion Act 
(1977) amended in 1991 and 2001
.  The responsible authority is the O ffice of the Board of Investment 
(BOI) . 
 
 G/SCM/102: Decision of 19 December 2002, gran ts Board of Investment projects with an 
export requirement an extensi on under SCM Agreement Article 27.4 of the transition period under 
Article 27.2(b).  For details con cerning the operation of these projects and other details as required in 
G/SCM/102, see G/SCM/Q3/THA/1 to G/SCM/Q3/THA/23, as well as the responses below to question 7:  Amount of the subsidy and question 8:  Duration of the subsidy and/or any time limit 
attached to it. 
 
5. Form of the subsidy 
 
 Tax concessions such as exemption
/reduction of corporate income tax, exemption /reduction 
of import duties on machinery, reduction of import duties on raw materials, and special deduction of 
certain expenditures . 
  G/SCM/N/114/THA 
 Page 3 
 
 
  The new investment promotion policy, eff ective since 1 August 2000, has abolished the 
export and local content requirements to comply with WTO obligations.  
6. To whom and how the subsidy is provided 
 General
 
  A wide range of activities covering primary, secondary, and tertiary sectors are eligible for 
investment promotion incentives.  The scheme is no t specific to any particular sector.  Moreover, 
companies in every province in Thailand can have  access to the investment promotion incentives.  
The Board of Investment has established the criteri a in granting tax incentives, which are generally 
based on the location of the investments.  The en tire country is divided into 3 zones as follows: 
 Zone 1:  Bangkok and vicinities (Samut Prakan, Samut Sakhon, Pathum Thani, Nonthaburi, and 
Nakhon Pathom) 
 
Zone 2:  Samut Songkram, Ratchaburi, Kanc hanaburi, Suphanburi, Ang Thong, Ayutthaya, 
Saraburi, Nakhon Nayok, Chachoengsao , Chonburi, Rayong and Phuket 
 Zone 3:  The remaining 58 provinces (the least developed area of which per capita income is 
below 85 per cent of the national average and which has less developed 
infrastructure).  All areas in Zone 3 provinces are designated as Investment 
Promotion Zones. 
  Zone 1 is granted the least incentives wher eas Zone 3, the most disadvantaged and least 
developed area, is granted the maximum incentives
.  Since September 2002, most activities eligible 
for investment promotion may be located in any zone  except certain activities that are required to be 
located in industrial estates or zones for environmental safety reasons . 
 
Factory Relocation  
  In order to further encourage decentralizati on, the Board of Investment also provides 
incentives for the relocation of existin g factories to other regions.  The following criteria are applied: 
 
1. The operation must relocate from Zone 1 to Zo ne 2 or from Zone 1 or Zone 2 to Zone 3. 
2. The operation must relocate to an industrial estate or promoted industrial zone. 3. The existing operation must be closed down a nd the operation at the relocated location must 
start within 2 years after receiving the promotion certificate. 
 
 The following incentives are granted: 
  1.  For relocation to Zone 2:  Corporate income tax exemption for 5 years.
4 
2. For relocation to 40 provinces in Zone  3:  Corporate income tax exemption  for 
8 years4;  50% reduction of corporate income tax for 5 years after the exemption 
period;  and double deduction from taxable income of water, electricity,  and transportation costs for 10 years
5. 
3. For relocation to the 18 provinces wh ich are the least developed and most 
disadvantaged in Zone 3:  Corporate income tax exemption for 8 years4;  50% 
                                                      
4 Provided that such a project with capital investment of 10 million baht or more (excluding cost of 
land and working capital) obtains ISO 9000 or similar international standard within 2 years from start-up date of 
its new plant, otherwise the corporate income  tax exemption will be reduced by 1 year. 
5 Starting from the date of first revenue derived from promoted activity.  G/SCM/N/114/THA 
Page 4  
 
 reduction of corporate income tax for 5 years after the exemption period; double 
deduction from taxable income of water, electricity, and transportation costs for 
10 years
5;  and deduction from net profit of 25% of  cost of installation or construction 
of infrastructure facilities for 10 years starting from the date of first sales. 
 
7. Amount of the subsidy 
  There is no specific budget earmarked for invest ment promotion incentives.  The information 
on the subsidy per unit therefore cannot be provided.  No statistics on corporate income tax exemption 
and reduction are available.   Pursuant to Thailand’s obligations under Article 27.4 of the SCM Agreement and the 
standstill requirement in G/SCM/102, the Board of I nvestment has eliminated the export requirement 
for projects applying for investment promotion in centives since 1 August 2000.  Therefore, no export 
subsidies have been granted to new operato rs applying for such incentives since then.
6  Furthermore, 
Thailand has progressively phased-out BOI projects with an export requirement approved prior to 
1 August 2000, which as notified in December 2002 to talled 532 projects, until as of 1 July 2004 only 
94 projects remain.7 Details relating to the remaining 94 projects can be found in 
G/SCM/Q3/THA/23, and details relating to the opera tion of these projects in general can be found in 
G/SCM/Q3/THA/1 to G/SCM/Q3/THA/20.  In accord ance with G/SCM/102, none of these projects 
have been modified so as to make them more fa vourable regarding scope, c overage, and intensity of 
benefits relative to the level of  benefits that existed as indicated in G/SCM/N/74, G/SCM/N/71/THA, 
G/SCM/Q3/THA/1 to G/SCM/Q3/THA/17 and suppl.1. 
 
8. Duration of the subsidy and/or any time limit attached to it 
 
 The duration of the Investment Promotion Incen tives programme is indeterminate.  However, 
the incentives granted to each investment are subject to certain time limits.   
 
 Regarding investment projects receiving an  extension under G/SCM/102, as previously 
mentioned in G/SCM/Q3/THA/20, G/SCM/Q3/THA/23, and G/SCM/N/95/THA, the BOI has formed a working group to study the elimination of the export requirement for the 77 projects currently 
scheduled to expire beyond the year 2005.  At present, the working group is conducting a survey to 
assess the effects that elimination may have on these projects, and the BOI is making continuous 
progress on eliminating the export subsidies.  
 
                                                     
 
6 See, e.g., G/SCM/Q3/THA/17. 
7 See G/SCM/Q3/THA/17, G/SCM/Q3/THA/20, and G/SCM/Q3/THA/23.  As mentioned on page 1 of 
this notification, for the year  2003, 40 projects receiving export subsidies were eliminated, so that by the end of 
2003 only 118 of the 158 projects notified for the year 2002 remained.  In addition, 24 projects were eliminated 
during the first half of 2004, so that currently only 94 projects remain.  G/SCM/N/114/THA 
 Page 5 
 
 
 9. Statistical data permitting an assessment of the trade effects of the subsidy 
 
 Statistics on Start-up of Investment Projects Granted Promotion Status by the Board of Investment 
 
Year Number of Investment Projects Total Investment Volume 
(billion baht) 
1999 526 205.3 
2000 625 304.9 
2001 611 267.9 
2002 626 203.7 
2003 251 74.5 
 Source:   Office of the Board of Investment, Ministry of Industry  
 
II. CREDIT REFINANCING SCHEMES  
 
1. Title of the subsidy programme 
 
 Credit Refinancing Schemes  2. Period covered by the notification  
 1 January–31 December 2003 
 
3. Policy objective and/or purpose of the subsidy 
 
 To provide financial assistance to priority sectors and projects through refinancing schemes. 
 
4. Background and authority for the subsidy 
 
 The legal basis of this scheme is the Royal Decree Regulating the Affairs of the Bank of 
Thailand B.E. 2485, Sections 12(4) and 12(7). The responsible authority is the Bank of Thailand 
(BOT).  
5.  Form of the subsidy 
  Loan 
 
6.  To whom and how the subsidy is provided 
 
In January 2003, the BOT terminated all of its refinancing schemes except those for Small 
and Medium Enterprises or SMEs and Investment in Zone 3.   
Regarding the SME refinancing scheme, during the year 2003, the BOT reduced the interest 
rate charged to the financial institutions in concert to the reduction in market interest rate.  Thus, in 
January and July 2003, the BOT reduced its refina ncing rate to 1.75% per annum and 1% per annum, 
respectively.  Financial institutions are permitted to charge interest on SMEs at a rate no greater than 
their minimum loan rate (MLR) minus 2.75 per annum.  G/SCM/N/114/THA 
Page 6  
 
 In October 2003, the BOT abolished the Regula tion Governing the Purchase of Promissory 
Note Arising from the SMEs (B.E. 2543) and re placed it with the new Regulation Governing the 
Lending Mechanism Warranted by Promissory Note I ssued by Credit-worthy SMEs (B.E. 2546). This 
new regulation does not change the eligible SMEs a nd interest rate applied under the BOT refinancing 
scheme. 
 
7. Amount of the subsidy 
 
 At the end of 2003, outstanding loans under the BOT financial assistance through the financial institutions were 18,581.78 mi llion baht.  Details are shown below. 
 
Interest Rate 
 
Schemes Outstanding as of 
December 31, 2003 
(Million Baht) Charged by the 
BOT (% p.a.) Charged by the financial 
institutions (% p.a.) 
Industry                    0.00 5.0           MLR – 1 
Small and Medium Enterprises           18,579.78 1.0           MLR – 2.75 
Livestock raising and 
aqua- culture                     0.00 3.0           MLR – 2.75 
Rural development                    0.00 3.0           MLR – 2.75 
Investment in Zone 3                    2.00 3.0           MOR/MLR - 2  
TOTAL           18,581.78   
 
8. Duration of the subsidy and/or any time limit attached to it  
 The BOT will provide financial assistance to each SME for a maximum of 5 years. 
 
9. Statistical data permitting an assessment of the trade effects of the subsidy 
 
 Not applicable.  
III. EXPORT MARKET DIVERSIFICATION PROMOTION PROGRAMME 
 
1. Title of the subsidy programme 
 
 Export Market Diversification Promotion Programme  2. Period covered by the notification 
 
 1 January–31 December 2003  
3. Policy objective and/or purpose of the subsidy 
 
 To promote exports to 141 targeted countries in 8 regions consisting of Indochina (4), Middle 
East (14), Africa (53), Latin America (31), Eastern Eu rope (27), South Asia (8),  East Asia (2) and the 
South Pacific Islands (2).  
 
4. Background and authority for the subsidy 
 
In early 1999, in order to stimulate export gr owth in the aftermath of the Asian financial 
crisis, the Ministry of Commerce launched the E xport Market Diversification Promotion Programme  G/SCM/N/114/THA 
 Page 7 
 
 
 to encourage diversification of Thai exports to new or potential mark ets, with EXIM Bank’s 
participation in financial measures. 
 Under this programme, EXIM Ba nk rebated interest to exporters who utilized the Packing 
Credit Facility (at the commercial banks) or Direct  Packing Credit Facility (at EXIM Bank).  Such 
interest rebate was capped at a ma ximum of 5 per cent and applicable  for the incremental export value 
over the previous year’s level to that partic ular export market.  Th e Ministry of Commerce 
allocated the 750 million baht fund from the Intern ational Trade Promotion Fund to EXIM Bank for 
5 years to facilitate this programme. 
 
 To comply with Thailand’s obligations unde r Article 27.4 of the SCM Agreement, Thailand 
terminated the Export Market Diversification Promotion Programme on 31 December 2003, after 
phasing out the programme by reducing the amount of funds available thereunder since the year 2000.  Please refer to the below response to question 7:  Amount of the Subsidy, for more details. 
 5. Form of the subsidy 
 
 Interest rebate  
6. To whom and how the subsidy is provided  
 
6.1 Exporters who have Packing Credit lines w ith commercial banks, or have Direct 
Packing Credit lines with EXIM Bank, complete and submit the Export Declaration for Interest 
Rebate Form when applying for credits.  
6.2 Exporters are required to include the clause “Export Market Diversification 
Promotion Programme” in documents accompanying the pr omissory notes used as collateral for credits. 
 
6.3 Once exporters have shipped their products  and have been paid by foreign buyers, 
they are required to submit copies of the bill of lading, Export Entry Form, invoice, and proof of foreign currency remittance together with an Inter est Rebate Request Form within 60 days from the 
due date of the last promissory note issued under such export. 
 
6.4 EXIM Bank checks all relevant details and cross-checks with the Ministry of 
Commerce, in particular the incremen tal export value to such market over the previous year’s level.  If 
all details are valid, EXIM Bank pa ys the rebate to the exporters. 
 
7. Amount of the subsidy 
 
To comply with Article 27.4 of the SCM Agreement, Thailand commenced its phase-out of 
the Export Market Diversification Promotion Programme in the year 2000 by decreasing the amount of funds available thereunder.  Initially, when th is programme commenced in 1999, the Ministry of 
Commerce provided to EXIM Bank an annual fund of 150 million baht for 5 consecutive years, 
totalling 750 million baht for inter est rebate under this programme.  However, in the year 2000, the 
Ministry of Commerce reduced the initial allocation of 150 million baht per year by 100 million baht.  
Therefore, for each year since then, no more than 50 million baht has been allocated by the Ministry 
of Commerce to EXIM Bank for the disbursement of the rebate.  
 G/SCM/N/114/THA 
Page 8  
 
 On 31 December 2003, the Export Market Di versification Promotion Programme was 
terminated. 
 
8. Duration of the subsidy and/or any time limit attached to it 
 
Date of Commencement:   14 June 1999 
Date of Termination:    31 December 2003, pursuant to Article 27.4 of the SCM 
 Agreement 
 
9. Statistical data permitted an assessment of the trade effects of the subsidy 
 
Under the Export Market Diversification Promotion Programme, interest rebates paid to 
exporters since June 1999 until D ecember 2003 total 85.1 million baht.
8 
 
 1999 2000 2001 2002 2003 
Interest Rebates 
(Million baht) 2.9 22.2 22.6 22.3 15.1 
 
IV. MERCHANT MARINE FINANCING 
 
1. Title of the subsidy programme 
 
 Merchant Marine Financing  
2. Period covered by the notification 
  1 January–31 December 2003 
 
3. Policy objective and/or purpose of the subsidy 
 
 - To alleviate the country’s deficit on balance of trade & services  - To strengthen Thailand’s merchant marine business  
 
4. Background and authority for the programme 
 
 In 1995, the Thai Government took a serious look into the country’s problem of current account deficit, and discovered that the neglected merchant marine business not only incurred revenue 
foregone but also brought about subs tantial outflow of freight and shipping expenses, not to mention 
the insufficiency of Thailand’s shipping business.   As a result, EXIM Bank launched a financial service for the merchant marine business from 
its own funds in early 1996.  La ter, in September 1996, the governme nt provided, through the Bank of 
Thailand (BOT), a credit line of 2 billion baht fo r Merchant Marine Financing at the EXIM Bank.  
Then, in February 1998, a portion of 1 billion baht from the Structural Adjustment Loan (SAL) from 
the ADB World Bank Co-financing to the Thai G overnment was provided to EXIM Bank to on-lend 
under Merchant Marine Financi ng together with Machinery Upgrading Financing (see below 
responses for item V: Machin ery Upgrading Financing). 
 
                                                     
 
8 As mentioned above, this Programme terminated on 31 December 2003, pursua nt to Article 27.4 of 
the SCM Agreement  G/SCM/N/114/THA 
 Page 9 
 
 
  In the meantime, EXIM Bank still provided financing from its own source of funds, 
especially to customers who did not qualify under th e BOT’s conditions, for ex ample, ships aged over 
20 years.  
5. Form of the subsidy 
 
 Loan  
6. To whom and how the subsidy is provided 
  EXIM Bank extended credit to entrepreneurs of  merchant marine business to buy/renovate 
their ships, new or used ones.   Customers qualifying under the BOT’s conditi ons could utilize the BOT’s funds in baht 
denomination which offered interest rates of up to 5 per cent p.a. while the BOT charged EXIM Bank at 
3 per cent p.a. EXIM Bank co-financed the other ha lf with the BOT’s funds in baht or US dollar 
denominations at the market interest rate.   From EXIM Bank’s own funds, financing was pr ovided in baht or US dollar denominations, 
both at the market interest rate , with more relaxed conditions. 
 
 As for the SAL fund, since the cost of fund was relatively high, i.e., above 6.41 per cent in US 
dollar lending, the fund was not co mmercially acceptable for customers. 
 Criteria for the BOT’s fund for Merchant Marine Financing:
 
 
- The business must be a company registered in Th ailand with over 50% of its registered capital 
contributed by Thai shareholders. 
- The loan must be used to finance investme nt in new ships or old ones with an operating 
period not exceeding 20 years.   
- The ship purchased must be registered in Thailand and sailed under the Thai flag. - The company must engage in merchant marine as its main business. 
 
 The term of lending from the BOT’s fund was up to 5 years, while that from EXIM Bank’s funds was up to 7 years, depending on business conditions.  
7. Total amount of the subsidy 
 
 - BOT’s fund  : 0.5  billion baht  - SAL fund : 25.7 million US dollars (together with funds for Machinery 
 Upgrading Facility) 
 - EXIM Bank’s own source of funds was up to customers’ demand for financing and 
funding availability. 
 
8. Duration of the subsidy and/or any time limit attached to it 
 
 Date of Commencement:  EXIM Bank’s facility  : Early 1996. 
 BOT’s fund   : September 1996. 
 SAL fund   : February 1998.  G/SCM/N/114/THA 
Page 10  
 
 9. Statistical data permitting an assessment of the trade effects of the subsidy 
 
(Unit: Billion baht) 
 1999 2000 2001 2002 2003 
Total credit granted 3.82 3.37 2.58 3.10 3.04 
Total BOT financing 1.19 1.17 0.92 0.36 0.15 
Credit outstanding at year-end 3.61 3.48 2.67 2.87 3.00 
 
V. MACHINERY UPGRADING FINANCING 
 
1. Title of the subsidy programme 
 
 Machinery Upgrading Financing  2. Period covered by the notification 
 
 1 January–31 December 2003  
3. Policy objective and/or purpose of the subsidy 
 
 - To improve the productivity of Thai industrial operators  - To encourage the renovation/upgrading of  the technology of production/quality of 
Thai products 
 4. Background and authority for the subsidy 
 
 The government deemed it necessary to improve the productivity of Thai industrial operators.  
Moreover, some industries faced the serious pr oblem of outdated technology of production which 
brought about low quality of products.  
 EXIM Bank therefore introduced a financial se rvice to facilitate the machinery upgrading of 
the operators.  The Thai government later supporte d this policy through the provision of funds from 
the Bank of Thailand (BOT) to co-finance this facility  with EXIM Bank.  Then came the SAL fund to 
be mutually used in Machinery Upgrading Fina ncing and Merchant Mari ne Financing (see above 
responses for item IV: Merchant Marine Financing). 
 
5. Form of the subsidy 
 
 Loan  
6. To whom and how the subsidy is provided 
 
 The EXIM Bank extended credit to operato rs whose plans to renovate/upgrade their 
machinery were approved by agencies authorized by the Ministry of Industry (MOI).   Operators eligible for the BOT’s fund must meet the following criteria: 
 
 - Operators’ renovation plans must have been approved by agencies authorized by 
MOI. 
 - The financing may be used to replace old machinery with new machinery, or to 
modify or further enhance the performance  of existing machines or equipment in 
order to increase efficiency.  G/SCM/N/114/THA 
 Page 11 
 
 
  - Investments may also be related to ener gy conservation, or related to environment 
conservation, including the relocation of factories into industrial estates, etc. 
  In addition, targeted industries eligible for this  facility were also clearly identified to cover the 
13 industries
9 under the Industrial Restructuring Plan, with small-and-medium-scaled enterprises 
(SMEs) as the priority.   
  Operators meeting the BOT’s criteria could u tilize the BOT’s fund in baht denomination by 
50 per cent of total lending at an interest rate of  not more than MLR-1 (MLR quoted by the 4 largest 
commercial banks).  EXIM Bank co-financed the othe r half, in baht or US dollars, at EXIM Bank’s 
prime rate plus up to 1.5 per cent p.a. for baht le nding; or LIBOR plus up to 3.5 per cent p.a. for US 
dollar lending.   Apart from co-financing with the BOT’s fu nd, EXIM Bank also provided Machinery 
Upgrading Financing on its own, with  more relaxed conditions, for instance, to finance investment in 
some kinds of machinery not included in the MOI’ s conditions.  The lending interest rate of EXIM 
Bank stayed at EXIM Prime plus 1.5 per cent p.a. in  baht lending, while US dollar lending is at the 
rate of up to LIBOR plus 3.5 per cent p.a. (EXIM Pr ime stayed at 5.75 per cent p.a. as of the end of 
2003).   The term of lending for machinery upgrading was up to 5 years for the BOT’s fund and up to 
7 years for EXIM Bank’s fund due to the repayment capability of operators. 
 
7. Amount of the subsidy 
 
 BOT’s fund  : 0.4 billion baht 
 SAL fund : 25.7 million US dolla rs (together with funds for  
  Merchant Marine Financing) 
 EXIM Bank’s own source of funds was subject to fund availability.  
8. Duration of the subsidy and/or any time limit attached to it 
  Date of Commencement: 
 EXIM Bank’s facility  : Early 1997.  BOT’s fund   : May 1997.  SAL fund   : February 1998.  9. Statistical data permitting an assessment of the trade effects of the subsidy 
 
(Unit: Billion baht) 
 1999 2000 2001 2002 2003 
Total credit granted 0.81 0.74 0.56 0.50 0.27 
Total BOT financing 0.55 0.15 0.12 0.27 0.19 
Credit outstanding at year-end 0.62 0.63 0.40 0.49 0.27 
 
 
                                                      
9 The thirteen industries eligible  under this program are as follows : (1) Food and animal food; (2) 
Textiles and articles of apparel and cl othing accessories; (3) Footwear and parts and leather and bovine leather 
products; (4) Wood and wood sheets and housewear; (5) Pharmaceutical and chemical products; (6) Rubber and 
rubber products; (7) Plastic products; (8) Ceramic products and tableware and kitchenware of glass; (9) Electrical equipment and elect ronic appliances; (10) Motor cars, parts and accessories; (11) Precious stones and 
jewellery; (12) Iron or steel products; and (13) Petrochemical industry and its related G/SCM/N/114/THA 
Page 12  
 
 VI. INDUSTRIAL ESTATE AUTHORITY OF THAILAND (IEAT) 
 
1. Title of the subsidy programme 
 
 Industrial Estate Authority of Thailand (IEAT) 
 
2. Period covered by the notification 
 
 1 January–31 December 2003  3. Policy objective and/or purpose of the subsidy 
 
 - To procure suitable land for the establishment or expansion of industrial estates 
which include the General Industria l Zone and Export Processing Zone. 
 - To provide facilities for industrial operators in the industrial estates 
 - To promote and control industrial estates owned by the private sector or other 
government agencies 
 
4. Authority for the subsidy 
 
 Industrial Estate Authority of Thailand (IEAT) 
 
5. Form of the subsidy 
 
 Incentives cover the exemptions of payment of surcharge under the law on promotion of investment, import duties, value added tax and excise  tax on machinery, equipment, tools and supplies 
including the components thereof which are essen tial for the production of goods or trading for 
export, as the case may be, and on materials to be u sed for construction, assembly or installation of 
factories or buildings and goods imported and ta ken into export processing zones by industrial 
operators and traders for export for use in th e production of goods or trading for export. 
 
6.  To whom and how the subsidy is provided 
 
 Incentives are provided to the industrial operato r who is permitted to engage in industrial 
activities in an industrial estate.   Since 1 January 2003, Thailand has eliminat ed the export requirement for the Export 
Processing Zone (EPZ), in accordance with G/SCM/101.
10  As indicated in G/SCM/101/Suppl. 1 and 
G/SCM/101/Suppl. 2, IEAT announcements No. 1/ 2531 and No. 2/2538 have been amended by 
announcement No. 1/2546, thereby effectively elim inating the export requirement for the EPZ.  
Regarding the current status of the legislative amendment of the IEAT Act as per the workplan 
submitted to the SCM Committee in G/SCM/101/Suppl. 1, the Office of the Council of State is currently verifying the bill proposed by the Cabinet, and upon completion of veri fication, will return it 
to the Cabinet for review. 
 
7. Amount of the subsidy 
 
 No specific budget provided 
 
                                                     
 
10 See G/SCM/101/Suppl.1 and G/SCM/101/Suppl.2.  G/SCM/N/114/THA 
 Page 13 
 
 
 8. Duration of the subsidy and/or any time limit attached to it 
 
 Upon operation period.  
9. Statistical data permitting an assessment of the trade effects of the subsidy 
 
(Unit:  Billion baht) 
 
YEAR 
  
IMPORT VALUE  
EXPORT VALUE 
1999 126.01 205.45 
2000 115.51 208.43 
2001 152.67 259.47 
2002 171.00 296.01 
2003 215.64 338.53 11 
TOTAL 780.83 1,307.89 
 
Source : Customs Department 
 
__________ 
 
                                                      
11As indicated above, since 1 January 2003 the export requirement has been eliminated by 
announcement No. 1/2546.