Economic czar sees major transformation in four years

Economic policies, major infrastructure projects and increasing innovation have put Thailand on a fast track towards becoming a more advanced economy with the Kingdom’s development level set to rise significantly over the next four years, according to Deputy Prime Minister Somkid Jatusripitak, who oversees the economy.

“With these important strategies, I am confident in three to four years, Thailand will be significantly transformed,” the Deputy Prime Minister told a Board of Investment (BoI) seminar titled Thailand’s new phase: Turning Opportunities into Realities attended by local and foreign investors.

Thailand can serve as an engine for Southeast Asian growth through the three strategies: hefty investment in megaprojects, EEC development, and promotion of digital technologies, he said. Investment trends are proving that to be the case, he added, noting that the BoI expects applications for investment approvals to reach nearly $25 billion this year compared to just $6.3 billion in 2015.

“This government has implemented socioeconomic reforms over the past two years that have resulted in significant economic expansion. Thailand has seen impressive economic growth over the period, recorded at 3.9 percent in 2017, up from 3.3 percent in 2016 and 2.8 percent in 2015. Exports also grew to $236 billion in 2017 from $214 billion in both 2016 and 2015. The government expects continued growth this year,’’ Somkid said.

More important than the monetary value of the investments and growth figures are the types of investments Thailand is beginning to receive. Investors have been showing interest and committing funds to higher-technology sectors, such as electric vehicles and digital startups, along with more traditional industries.

That is in line with and bodes well for Thailand 4.0, the 20-year national strategy to advance Thailand’s economy and society to a higher-technological level where innovation, creativity, and research and development are important sources of growth.

Kan Trakulhoon, a member of the EEC Committee and a former chief executive of SCG (Siam Cement Group), said Thailand would soon be rising in the global innovation rankings. He credited the government’s policies and support programs for research and development (R&D) with providing the important foundations for the expected rise.

“R&D is expected to reach 1 percent of GDP this year,” Kan said. “This shows that Thailand is entering a new era of innovation.”

While that percentage is lower than some developed economies, it is a significant improvement over just a few years ago when it was just 0.2 percent of GDP. The percentage has been rising every year since 2015 and the government would like to see it continue to trend upwards.

The private sector has an important role to play in that. About 70 percent of spending on R&D is done by the private sector.