Government incentives boost Thailand's medical device production

Latex items such as gloves dominate its local medical device manufacturing.

Domestic production and investment of medical devices in Thailand could gain from the number of economic measures implemented by the Board of Investments to mitigate the impact of the pandemic on businesses, according to a report by Fitch Solutions.

These measures include corporate tax reductions and exemptions, temporary relaxation of investment conditions and support to Research and Development, which all aim to encourage rapid investment in the manufacturing of critical medical products.

In particular, the new incentives for the medical device industry is expected to support Thailand's position as a leading supplier of medical gloves globally. Latex items dominate its domestic medical device manufacturing, and the country stood as the third top supplier of surgical gloves in the world in 2019 at $271.4m, behind only Malaysia and China.

With this, medical device exports are tipped to receive a boost in 2020, as demand rose globally amidst the pandemic. Exports grew by 1.5% YoY to $269.2m in the three months to February, compared with the $265.2m for the three months ending February 2019.

“We note that annual exports have maintained positive growth in every year since 2016, although they are losing momentum due to weak external demand stemming from global trade tensions and weak economic growth in most countries including the US, Thailand's leading medical device export market,” Fitch added.