Thailand's government has approved restrictive new regulations which will affect foreign investors in the country's businesses.
The Foreign Business Act, now approved by the Thai cabinet, is likely to prevent foreign companies from owning over 50 per cent of any specific business.
Despite predictions by analysts that the move will trigger another outflow of capital from the east Asian country, prime minister Surayud Chulanont insisted that the move would benefit international stakeholders.
"It may take a while for us to make foreign investors understand and regain their confidence. They will know that we want to make the law clearer," the Bloomberg news agency quoted Mr Chulanont as saying.
The Thai stock exchange has struggled in recent weeks following two separate incidents which shook international confidence in its security as a safe place to invest.
In December new banking regulations placed crippling restrictions on foreign investors, causing the market to crash by 15 per cent.
A recovery followed the rescinding of some of the most punishing regulations, but the Thai exchange dropped again after the New Year's Eve bombings in Bangkok, in which three people died.
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