Digital economy expands, all villages now online
As the year came to a close, Thailand’s government achieved its goal of creating a national broadband network that provides access to all of the Kingdom’s villages as a study released last week showed that Thailand’s digital economy grew by 20 percent in 2017 and now accounts for 17 percent of gross domestic product.
The value of Thailand’s digital economy during 2017 was over $76 billion, according to the study by the Center for Economic and Business Forecasting at the University of the Thai Chamber of Commerce (UTCC). The center was even more optimistic about 2018, forecasting that the information technology-related economy will expand 25 percent to $97 billion, accounting for 19 percent of gross domestic product (GDP).
Fostering the growth of the digital economy is a signature policy of the government of Prime Minister Prayut Chan-o-cha. His administration has overseen the development a 20-year national strategy named Thailand 4.0 that seeks to make innovation, research and development, and higher technologies the driving force of Thailand’s economy and society. The strategy is designed to advance Thailand to a higher level of development and keep the country competitive for decades to come.
One of the cornerstones of that policy is to ensure that the entire Kingdom has access to the cyberworld, both for educational and economic purposes. The government achieved that goal in December, announcing that broadband is now available in every village, even remote villages. Providing access, however, is just the first phase in that program. Making optimal use of that access is goal of the next phase, and that will involve establishing community e-commerce ecosystems around the country beginning in early 2018.
Digital Economy and Society Minister Pichet Durongkaveroj said that the government would help set up community e-commerce ecosystems as they would “create value for sustainable rural development.” Forging greater opportunities for rural people and those far from major cities is essential to reducing income and development disparities, a dilemma that plagues Thailand and many developing and developed countries.
At the moment, those disparities are also evident in the digital economy, as growth has been concentrated in a few areas such as online shopping and financial services. Uptake among production chains has been slower, but is taking place and should being to gather speed, according to the Kasikorn Research Center.
The center forecast that the value of online shopping will grow between 20 and 25 percent next year because of consumers’ use of smartphones and online payment infrastructure provided by the public and private sectors. It also cited the new national broadband system as a factor in that growth.
The UTCC said that factors that support growth of the digital economy include the Thailand 4.0 policy, the government’s adoption of cyber services and the expansion of internet infrastructure to remote communities. The university also said knowledge of information and communication technology is more common among even rural people now, and that high-speed internet is reasonably priced.