BANGKOK: The debate over foreign ownership of real estate in Thailand has intensified since the Cabinet meeting last Tuesday (June 18) when the Interior Ministry’s proposal to amend two laws was approved.
The proposed changes include extending leaseholds to 99 years and increasing the quota for foreign ownership of condominiums to 75% in central Bangkok, Phuket and Pattaya, responding to rising foreign demand.
Currently, Thai law allows foreigners to lease property for 30 years with a possible extension of another 30 years. Also, condominiums must limit foreign ownership to 49% to ensure Thais retain majority control.
Despite being in its early stages, the policy has sparked a lot of criticism, with many accusing Prime Minister Srettha Thavisin (pic) and his Pheu Thai Party of “selling the nation”.
Several critics also reminded the party of its stance when it was sitting on the opposition bench just two years ago.
Under General Prayut Chan-O-Cha’s government, the Cabinet approved a regulation allowing foreigners to purchase up to 1 rai (about 0.16 hectares) of land in Thailand, provided they invested at least 40 million baht and maintained the investment for at least three years in specified businesses or activities.
This policy sparked resistance from various groups, such as “99 Citizens”, and then-opposition leader Pheu Thai Party.
The party argued that letting foreigners buy land would further reduce opportunities for Thais to own land in their own country. It pointed out that some 80% of the Thai population does not own land.
In a House debate, then-Pheu Thai MP and chief opposition whip Sutin Klungsang questioned Prayut about the necessity of this “selling the nation” law.
He cited the conditions of the IMF loan in 1999, which led to a cautiously implemented policy in 2002 that allowed foreigners to buy land but resulted in very few purchases by non-Thais.
Sutin also raised concerns that the new measure suggested financial desperation, which could lead to national insecurity.
“What is the necessity for this measure? If it’s due to economic problems, then it suggests that the government is in a financial bind and reliant on foreign funds. If left unchecked it could lead to national insecurity due to our weaker economic structure,” Sutin said in a House debate on Nov 3, 2022.
“Thais may become nominees for foreigners. Nobody intends to sell the nation, but many fear it could lead to an unintentional sale of the country.”
General Anupong Paochinda, then interior minister, explained that the measure aimed to stimulate the economy after the Covid-19 pandemic, by attracting long-term foreign investment. He said this would be done through housing but with stricter conditions.
“There is no intention to sell the nation, nobody will do that. I believe nobody in this Parliament, be it the government or the opposition, intends to do such a thing,” Anupong told Parliament.
He also said that the proposed regulations would prevent large-scale foreign land purchases and the formation of foreign enclaves.
Later, the Council of State was tasked with gathering public opinions and potentially setting stricter conditions like raising the investment requirement to 100 million baht or extending the investment period from three to 10 years before resubmitting the plan to the Cabinet.
This proposed regulation also sparked several public discussions, with some people suggesting it was not a new legislation, but a revision of a policy issued in 2002 under then-PM Thaksin Shinawatra. Some even referred to it as “Thaksin’s idea, Prayut’s implementation”.
Yet, despite this connection with its patriarch Thaksin, the Pheu Thai Party continued opposing the regulation and even promised to amend the 2002 regulation.
Thanks to the strong opposition, the Prayut Cabinet withdrew the ministerial regulation for further study. The policy effectively “died” during the final phase of Prayut’s government, which soon dissolved Parliament.
Now, less than two years later, the political landscape has returned to this debate, with the ruling Pheu Thai Party now facing similar criticism.
The phrase “Thaksin’s idea, Pheu Thai’s implementation” has resurfaced, with the rhetoric treading the thin line between “saving the nation” and “selling the nation”.
Srettha has maintained that the Finance Ministry’s proposal pertains to “long-term leasing” rather than selling land.
Deputy Finance Minister Julapun Amornvivat has also confirmed that this policy does not grant absolute rights to foreigners, just extends the current lease terms to provide more incentives.
Nonetheless, criticism continues, often linking the issue to influential real-estate tycoons with political ties, raising concerns about mutual benefits.
Senator Somchai Sawaengkarn recently highlighted this issue, urging activists to submit it for legal interpretation regarding potential conflicts of interest under the Constitution and the anti-corruption law.
As the debate unfolds, it remains to be seen how the government will navigate and deflect these challenges to protect its integrity amid ongoing scrutiny. - The Nation/ANN
