Asia is falling into line with global economic trends, specifically in the Association of Southeast Asian Nations (ASEAN) market where the average GDP is 5-8%. ASEAN countries, such as Singapore, Indonesia, Malaysia, Brunei and the Philippines, have significant population with considerable purchasing power, making the region a major economic powerhouse. Over the next year, Thailand is expected to be one of the top five economies in the Asia-Pacific Economic Cooperation (APEC) for outbound investment.
Thanks to its prime geographic location at the centre of four high-growth emerging markets, namely Cambodia, Laos, Myanmar and Vietnam (CLMV), Thailand–Southeast Asia’s second-largest economy–is reinforcing its position as a regional business hub.
The nation has strengthened its readiness in terms of technology and the digital business sector by implementing the Thailand 4.0 policy. This policy focuses on the development of digital platforms and ecosystems as well as the skills needed in the digital economy. Thailand has seen tremedous growth in its IT sector in recent years and is regarded as one of the industry leaders in the region. The country plans to establish smart cities nationwide and transition from 4G to 5G technology.
Thailand is well-positioned to reap the full benefit of its current strengths and capture the opportunities that lie ahead on the road to the digital era. Amid a changing business environment and a continuous trade conflict between the US and China, many Thai companies have shown strong confidence in their ability to cope with challenges.
This is reflected in their optimism about revenue and investment opportunities as well as their readiness to adopt new digital technologies.
As part of PwC’s 2018 APEC CEO Survey, this Thailand report will provide an overview of business confidence and investment orientation in the country, including the prospects for cross-border activities. It will clarify how organisations assess their digital and technology transformation such as digital customer interactions, operations, and development of digital products, as well as which areas businesses believe they need to focus on to stay competitive.
Conclusion
In today’s business environment, so much about digital transformation has been discussed, suggested and implemented. Companies are using digital technology to engage and serve customers, and customers are embracing this. Adopting digital technology and innovations has lately become ubiquitous for many companies, but companies are asking how to best take their organisations through the often painful process of becoming digital-based organisations. Firms whose leaders embrace digital technology and endorse the nation’s digital agenda will be in good shape in this new business environment.
- Implications for policy makers
- Implications for businesses
Implications for policy makers
Thailand will likely host a general election in 2019. Several major projects initiated under the military government will need the support of civilian leaders if they are to drive long-term growth. Priority areas for the next government include supporting and expediting many industrial sectors such as telecommunication, education, health services, public services, science, technology and innovation as well as the digital economy.
Government support is key to driving forward a digital agenda for the private sector. So in coming years, civilian leaders will have a lot to do in terms of building the required infrastructure for the digital business environment, setting adequate laws and regulations for e-business and e-commerce platforms, as well as improving the digital talent pipeline through training STEM professionals. The private sector is very advanced in terms of technology, and the digital industry is very dynamic. Policy makers, on the other hand, need to keep pace with the private sector. They’ll also need to raise awareness among international investors that Thailand is moving to a high-tech, innovative and digital society.
- Thailand’s medium- and long-term economic outlook remains bright. But external unpredictability and a protracted US-China trade dispute could slow Thailand’s exports and increase inflation as supply chains are disrupted, which could impact the nation’s growth. It’s time for Thailand to expedite its domestic consumption, reinforce infrastructure projects by establishing a set of attractive investor incentives and strategies, and revamp the education system to ensure a steady supply of skilled labour.
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