Tim Bass
09-04-2008 07:16 AM
Recently someone asked about business in Thailand.**Here is my first post on this topic:
First of all, I learned the Thai alphabet nearly 20 years ago, so I have have a pretty good foundation for the Thai language.** I can read (slowly) and speak better than 99.99+ percent of all foreigners in Thailand; so, I thought it was time to redirect my career to a “new challenge” in the business climate of Thailand.***
This was no small decision.**Your career changes dramatically when you give up a successful consulting practice in the US and dive into business in a foreign land for a new challenge.* I can frankly tell you that often the challenge is sometimes overwhelming.*** It is quite difficult as a foreigner to do business in Thailand.
First of all, it is not legal for foreigners to own land in Thailand.* Foreigners can*”own” land*using a variety of legal loopholes, proxy owners and shell companies; but all of this is risky and not advised.* Foreigners lose a lot of money coming to Thailand and attempting to buy land.* Some get lucky, but the entire process of foreigners*buying and selling land is quite risky.
Foreigners can own condos, under certain conditions, but this results in* inflated prices for condos in Thailand that are traded in an artificial market place.** Condos that are up-to-par with condos in the US can easily cost more than condos in*major cities in the*US.* Hence, the cost of living is not as cheap as some might believe.
Business can best be described as “protectism” where the government has placed many barriers to entry*to foreigners working in Thailand.**** Every foreigner must have a work permit and these work permits are expensive*and time consuming*to maintain.***If you own a business you must pay high professional service fees for auditors to perform annual and*semiannual audits even*if your business*has no*income yet.** Firms in Thailand charge*thousands of dollars for these*”audits”.******
In addition, if you*operate a business, you must have a*place of business, so you are forced to lease office space.** Foreigners from the US must be paid a minimum of 50,000 Thai Baht per month, so the government will take 10 percent of that each month*as their share of*tax withholdings.***Therefore,*to*start a company, you will pay a lot of money in startup fees,*permits, tax, leases, visas, etc.* The entire system is designed to secure money from you, even if you do not have a penny of*incoming revenue.
Of course, generating incoming revenue*can be quite difficult in*a climate of protectionism.** In Thailand, it is easy*when you are spending money.* When you are trying to generate income from*Thailand, as a foreigner the challenge*can seem overwhelming at times.** Many foreigners here give up because the barriers to business here are very high.
On top of all these challenges, which I have not described in detail, is the overall global business slowdown combined with a climate of political instability, which I am sure you have seen in the news.**
Most people I know say it is better to be a tourist here.** Being a tourist is completely different.* Money flows from you, so life in Thailand is fun and friendly, complimentary to the “Land of Smiles” you have heard about.**** However, when you are working to have money flow the other direction, flow to you versus away from you, you don’t see the “Land of Smiles” as tourists experience.
Without getting into too many details, I can simply say that a foreigner doing business*in Thailand experiences protectionism and, to a certain*degree,*discrimination, and sometimes I wonder*if coming here for a “business challenge” was a good idea.*** I was seeking a “new challenge” and I got more than I bargained for!
In a future post on business in Thailand I will discuss issues regarding how little value is placed in intellectual property in Thailand and how this adversely impacts professional services.*** I will also touch on how this lack of regard for intellectual property impacts a consulting practice.** Also, I will touch on some cultural differences in how Thais appear to view teamwork, which is very different than in the US.
*
Source...
