Investing in Asia

May 1, 2018

From the Land of the Midnight Sun to the Beautiful Beaches of South East Asia, Svendheim Builds a Hospitality Empire, Celebrating their 9th Anniversary.

For those who are new to the idea of investing in Thailand or even Asia in general, we have put together a summary to act as your introductory guide. We welcome you to study this data and refer to the private placement memorandum for further information.

Thailand Macro Forecast

Thailand’s economy grew faster than economists estimated last quarter and is on track for a strong year in 2018, underpinned by a pick-up in exports and booming tourism. After years of lagging its neighbors, Thailand’s economy is finally catching up with the economic boom in Southeast Asia, fueled by a global trade recovery and a flood of visitors from China. The end of a yearlong mourning period for King Bhumibol Adulyadej strengthens the outlook for consumer spending into next year, while the government is ramping up spending on infrastructure projects to support growth.

The statistics agency said the economy will probably expand 3.6 percent to 4.6 percent this year, supported by export growth of 5 percent.

“Economic growth [this] year will accelerate from [2017],” Porametee Vimolsiri, secretary general of the statistics agency, or National Economic and Social Development Board, told reporters in Bangkok. “We may see 4 percent level, supported by an improving global economy, government investment and a clearer recovery of private investment. We will see improving employment and revenue.”

Prime Minister Prayuth Chan-Ocha has adopted measures to boost growth, including a 1.5 trillion baht ($46 billion) infrastructure spending plan, and tax breaks for year-end shopping. Thailand -- under military rule since 2014 -- is on course for elections next year.

“Growth is broadening with exports and tourism still doing the heavy lifting,” said Eugenia Victorino, an economist at Australia & New Zealand Banking Group Ltd. in Singapore. “Our 2017 GDP growth forecast of 3.5 percent now looks light and we will be revising it to reflect the endurance of the export recovery.”

The Market

Current State of the Thailand Tourism and Hospitality Market
Thailand welcomed over 28.8 million international visitors from January to October 2017 and earned 1.47 trillion Baht in tourism revenue. Mr. Pongpanu Svetarundra, Permanent Secretary of the Ministry of Tourism and Sports, recently told a press conference on the kingdom’s tourism performance. Both figures represented increases over 2016.

The precise number of overseas tourists for the 10 months of January to October was 28.8 million, an increase of 6.7 percent over the same period of 2016, this was up 9.31 percent over the 2016 period.

For the month of October 2017, the number of foreign tourists jumped 20.92 percent over October 2016 to 2.7 million. Tourism revenue for October 2017 also rose significantly, up 24.4 percent to a little over 142.63 billion Baht.

Among source markets, Southeast Asia stood out with 29.4 percent growth in tourists sent to Thailand during October. The top 10 individual markets were China, Malaysia, Lao PDR., South Korea, India, Japan, Russia, Cambodia, the US and UK.

Mr. Yuthasak Supasorn, Tourism Authority of Thailand Governor, commented: “With the launch in November of the TAT’s new ‘Amazing Thailand Tourism Year 2018’ marketing concept, which focuses on segments like sports, gastronomy, weddings and honeymoons, luxury and community-based tourism, we’re confident of even higher visitor growth.”

Thailand’s domestic tourism sector also showed positive growth. January to September 2017 saw Thais made 109.2 million trips in their own country (up 6.32 percent over the same 2016 period) generating more than 695.2 billion Baht in revenue (up 7.3 percent over the same 2016 period).

Industry Trends

More than 8 million people visited Pattaya in the first half of 2017, putting the city on a record pace for both visitors and tourism revenue, tourism officials said. Speaking at the September 14 meeting of the Pattaya Business & Tourism Association at the Grand Sole Hotel, TAT Pattaya office Director Suladda Sarutilavan said the area also has earned 110 billion Baht from tourism. In 2016, Pattaya attracted 17.7 million visitors who generated revenue of 200 billion baht.

The government is promoting U-tapao airport as another gateway to the eastern provinces and will build a rail link between U-tapao and Suvarnabhumi and Don Mueang airports. A ferry service has been launched, linking it across the Gulf with Chaam in Phetchaburi, and another sea link will join Sattahip in Chon Buri and Koh Chang in Trat. “All will help promote tourism in Pattaya,” TAT Pattaya office Director Suladda Sarutilavan said.

Regulation D 506(c) mandated legend

Any historical performance data represents past performance. Past performance does not guarantee future results; Current performance may be different than the performance data presented; The Company is not required by law to follow any standard methodology when calculating and representing performance data; The performance of the Company may not be directly comparable to the performance of other private or registered funds or companies; The securities are being offered in reliance on an exemption from the registration requirements, and therefore are not required to comply with certain specific disclosure requirements; The Securities and Exchange Commission has not passed upon the merits of or approved the securities, the terms of the offering, or the accuracy of the materials.

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