Thailand Tightens Environmental Regulation

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Thailand’s biggest foreign investors have learned to live with a lot in recent years, including mass protests, airport closures and persistent rumblings about military coups. But now there is another issue that has companies such as Ford Motor Co., and a host of petrochemical firs wondering if they should be putting their money somewhere else: the government’s struggle to deal with tough new environmental regulation.

In September, a Thai court sided with the country’s growing green movement and suspended $12 billion on investments on Thailand’s industrial eastern seaboard – the world’s eighth-largest petrochemical hub – until their environmental impact can be properly assessed. The move caught the government by surprise, and leaders worry the injunction could shave half a percentage point off Thailand’s expected four to five percent growth rate this year.

The move also provided new evidence that environmental activists are gaining ground in parts of developing Asia after years of largely ineffective lobbying – a development that could further ramp up regulatory hurdles for large investors. Activists have likewise stepped up their lobbying in Indonesia, Vietnam and China over the past several years, at times pressuring their governments to slow or cancel environmentally sensitive projects.

Bangkok hopes to set up a new environmental-monitoring agency within five months to quickly assess and approve new projects and keep investment flowing into the country. But a growing number of companies, including many that aren’t involved in the oil and chemical industries and have solid green credentials, are now becoming increasingly concerned about the changes and the uncertain regulatory environment they have created, and they want the investment crisis solved as soon as possible.


  • Mark Spowart

    A writer and photographer, Spowart has publication credits in Canada, United States, Europe and Norway with such publications as The Globe & Mail, The National Post, Sun Media, Canwest News, and Canada News Wire.

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