Introduction:
The agricultural and food industry in Thailand is undergoing a remarkable transformation, driven by innovation and a commitment to meeting the evolving demands of a global market and the environmental issues facing the planet.
With the Thailand Board of Investment (BOI) helping to bring this industry to the spotlight, Thailand is positioning itself as a leader in the future food landscape, developing technology and sustainable practices to enhance its agricultural potential.
Key Points
- Thailand is positioning itself as a leader in future food innovation, focusing on sustainable and technology-driven food production methods including plant-based foods, lab-grown meat, and alternative proteins.
- The Thailand Board of Investment (BOI) offers significant incentives for future food businesses, including 8-year tax exemptions, 100% foreign ownership rights, and simplified visa processes for foreign employees.
- Four main categories are eligible for BOI promotion: manufacturing food with health claims, novel food production, organic food manufacturing, and medical food production.
- Common beverage products like energy drinks, sodas, and flavored waters are specifically excluded from BOI promotion eligibility.
- Thailand’s agricultural sector benefits from year-round growing seasons and local sourcing of 80% of raw materials, supported by government initiatives under the “Thailand 4.0” economic plan.
Read Also : Thailand 4.0 and the Eastern Economic Corridor
What is Future Food?
“Future food” focuses on innovative, sustainable, and technology-driven concepts aimed at addressing the challenges of feeding the growing global population while minimizing the environmental impact of food production. Future Food involves rethinking traditional food sources, food production methods, and dietary habits. Some key areas in the future of food include:
Plant-Based Foods
With the rise in popularity of vegetarian and vegan diets, plant-based foods (such as meat alternatives like Beyond Meat or Impossible Foods) are becoming more popular. These foods are made from plants and offer protein, fats, and nutrients that mimic those in animal products but with a smaller environmental footprint.
Lab-Grown Meat
Also known as cultured meat, this is produced by cultivating animal cells in a lab rather than raising and slaughtering animals. It’s expected to reduce land, water, and greenhouse gas emissions associated with traditional livestock farming.
Alternative Protein Sources
An effort to identify other forms of sustainable protein sources has led to the development of edible insects, seaweed, algae, and fungi. These products are highly nutritious, require less land and water, and produce fewer emissions than conventional animal farming.
Food from Biotechnology
Advances in genetic engineering may lead to foods that are more resilient to climate change, pests, and diseases. For example, genetically modified crops could be designed to have higher yields, better nutrition, or reduced environmental impact.
3D-Printed Food
This technology uses a printer-like device to create food items, layer by layer, often using alternative ingredients like plant proteins or even powdered bugs.
Fermentation and Cellular Agriculture
Fermentation can be used to create protein-rich foods or dairy products without animals. Microbial fermentation can also produce sustainable food ingredients, such as flavor enhancers or functional foods, using fewer resources.
Vertical Farming and Urban Agriculture
Growing food in controlled environments like vertical farms or on rooftops in cities is seen as a potential solution for producing fresh food locally while reducing transportation costs and land use.
Regenerative Agriculture
Regenerative Agriculture focuses on farming practices that restore soil health and biodiversity, helping to combat climate change and promote food security. It emphasizes practices like crop rotation, agroforestry, and cover cropping.
Future food aims to make food healthier, more sustainable, and less dependent on traditional agriculture, aiming to meet the needs of a growing population addressing environmental challenges.
Thailand’s Agri-Food Industry
Thailand’s agricultural sector has long been recognized for its rich diversity and availability of raw materials, making it a leading country in food production. Thailand ranks among the world’s top exporters of key agricultural products, including rice, cassava, and canned fruits.
Thailand’s food industry contributes significantly to the national economy, accounting for approximately one quarter of the industrial gross domestic product.
Key Factors Driving Growth
Diverse Agricultural Resources:
Thailand’s geographical position provides year-round growing seasons, enabling consistent production of various crops. This diversity allows for the sourcing of over 80% of raw materials locally, which not only reduces costs but also supports local farmers.
Technological Advancements
The integration of advanced technologies such as artificial intelligence, robotics, and big data analytics is transforming traditional farming practices. These innovations improve productivity, improve quality control, and streamline supply chain management.
Government Support
The Thai government recognizes the importance of the agri-food sector and has implemented policies to promote its growth. Initiatives under the “Thailand 4.0” economic development plan prioritize the agricultural industry, emphasizing the need for research and development (R&D) and technological adoption.
The Role of the BOI in Promoting Food Innovation
The Thailand Board of Investment plays a key role in promoting the agri-food industry by offering incentives and support to both local and foreign investors.
BOI General Business Incentives
In addition to the attractive tax incentives, the BOI certification offers several non-tax benefits that further enhance the appeal for fintech companies:
100% Foreign Ownership
While regular Thai Limited companies are typically limited to 49.9% foreign ownership due to the Foreign Business Act, BOI-promoted companies face no such restriction, allowing complete foreign ownership.
Foreign Business Certificate
BOI-promoted firms receive a Foreign Business Certificate, exempting them from the 50+ restricted business categories under the Foreign Business Act. This opens up opportunities for a wider range of business activities in Thailand.
No Employee Quotas
Unlike other structures, BOI-promoted companies face no quotas when hiring foreign skilled employees. For example, Thai Limited Companies typically need a 4:1 ratio of Thai to foreign employees, but this requirement doesn’t apply to BOI-promoted businesses. Additionally, the process of obtaining visas for foreign employees is significantly more straightforward with BOI approval.
Facilitation of Work Permit and Visa Applications for Foreign Employees
Foreign employees can apply for and obtain their visas and work permits at the One Stop Service Center in Bangkok. This greatly speeds up the entire process as applicants can pick up their work permit and visa in a couple of hours.
Tax Incentives
The BOI provides attractive tax incentives, including an 8-year exemption on corporate income tax (CIT) for companies engaged in the manufacture of functional foods and supplements. This encourages investments in R&D and the adoption of innovative technologies.
Support for Startups
The BOI is actively involved in providing support for startups within the food tech space. Programs like SPACE-F, Thailand’s first global food tech startup incubator, offer mentorship and resources to entrepreneurs looking to innovate in food production.
Eligible Business Activities For a BOI Promotion in Future Foods
The following business activities are eligible for a BOI promotion under the Future Foods category.
Manufacturing food with health claims
The project must manufacture products which are beneficial to health. The products must have received a qualified health claim assessment from the Food and Drug Administration or other agencies with internationally accepted standards. The qualification must be obtained before the full operation deadline.
Examples of products which would not be eligible for a promotion under this category include:
- sugar,
- sport drinks,
- Diluted juices,
- energy drinks,
- alcoholic beverages,
- drinking water,
- flavored and non-flavored soda,
- carbonated beverages,
- vitamin water and
- flavored drinking water.
Manufacture of novel food
Novel food refers to food products or ingredients that are newly developed or derived from innovative processes, and are not easily available in the local market. Eligible products can include products that address nutritional needs, sustainability, or food security concerns.
Novel food products must be registered with The Food and Drug Administration or other agencies with internationally accepted standards. The product must be registered before the full operation deadline.
Examples of products which would not be eligible for a promotion under this category include:
- sugar,
- sport drinks,
- Diluted juices,
- energy drinks,
- alcoholic beverages,
- drinking water,
- flavored and non-flavored soda,
- carbonated beverages,
- vitamin water and
- flavored drinking water.
Manufacture of Organic Food
Projects the grow of product organic products must be certified by international organic agriculture standard, such as International Federation of Organic Agriculture Movements (IFOAM), Canada Organic Regime (COR), The National Organic Program (NOP) or an equivalent international standard. The certification must be obtained before the full operation deadline.
Examples of products which would not be eligible for a promotion under this category include:
- sugar,
- sport drinks,
- Diluted juices,
- energy drinks,
- alcoholic beverages,
- drinking water,
- flavored and non-flavored soda,
- carbonated beverages,
- vitamin water and
- flavored drinking water.
Manufacture of Medical Food
Medical food refers to specially formulated food products designed for the dietary management of specific diseases or health conditions. These products are formulated to meet the unique nutritional requirements of patients under medical supervision and are typically intended for use as part of a healthcare regimen.
Products must be registered as “medical food” with the Food and Drug Administration or other agencies with internationally accepted standards within the full operation start-up date. The registration must be completed before the full operation deadline
Examples of products which would not be eligible for a promotion under this category include:
- flavored drinking water.o become a key player in the regional and global supply chain for smart electronics and related industries.
- sugar,
- sport drinks,
- diluted juices,
- energy drinks,
- alcoholic beverages,
- drinking water,
- flavored and non-flavored soda,
- carbonated beverages,
- vitamin water and
Our Thoughts
The BOI’s wide-ranging incentives, including 100% foreign ownership, corporate tax exemptions, duty reductions, facilitated land ownership, and simplified recruitment for foreign expertise give businesses a competitive advantage in the future foods market. These incentives minimize operational burdens, allowing companies to focus resources on innovation, product development, and scaling production.
With a skilled workforce in food technology, bioscience, and agriculture, Thailand provides a strong foundation for businesses aiming to advance their future food initiatives. By capitalising on these incentives, companies can streamline operations, innovate sustainably, and position themselves as leaders in a sector that is shaping the future of food globally.
