Thailand rises in world competitiveness index

3_IMD5Thailand rose two spots to be ranked the 28th most competitive economy in the world according to the Swiss-based IMD World Competitiveness Center in its annual World Competitiveness Index released last week. Thailand registered progress in a range of categories including fiscal policy and business legislation.

The International Institute of Management Development (IMD) has been publishing global competitive rankings since 1989. The Lausanne-based institute has been described as one of the world’s premier business and management institutions, and Forbes magazine rated its MBA program as the best in the world in 2011 and 2013. Its competitiveness rankings “analyze the ability of nations to create and maintain an environment in which enterprises can compete,” and is based on statistical evidence and surveys of top and middle managers in each of the 61 countries it examines.

Thailand had slipped in the rankings each year since 2013 when it was placed at number 27. But positive improvements in economic performance and reforms measures implemented by the current government served to turn the situation around and cause Thailand’s rank to climb in this year’s assessment.

Thailand’s competitiveness ranking moved up two notches to 28th based on improvements in crucial criteria including political stability, policy flexibility and policy, real GDP growth per capita and exchange rate stability, according to the IMD.

The IMD also examined how business-friendly the environment is, openness and positivity, the skill level of the workforce, the reliability of infrastructure and overall dynamism. Thailand scored well in all those categories.

Government actions, however, were equally important.At the start of 2016, the government streamlined the business incorporation process from three steps to one. It also lowered the required number of paper documents involved in the process from 22 to one. These and other changes were the result of consultations and collaboration with the business community.

Government agencies have also been taking steps to reduce red tape and facilitate doing business in Thailand. The Customs Department has cut the export customs clearance period to three days from four, and has said it expects to cut the time required even further.

“Credit must be given to the government for this achievement,” the Bangkok Post wrote in an editorial about the improved ranking.

The IMD noted several areas in which Thailand could improve. It urged the Kingdom to focus on investment, education and political reform to further boost its competitiveness ranking.

It is also recommended Thailand further develop transport and logistics systems to capitalize on its competitive advantage especially with respect to regional supply-chain linkages.