In 2016, writing in the Thammasat Economic Journal, Emory University professor Richard Doner described in just a few sentences the problems that plague Thailand’s economy.
Thailand had been “quick on its feet,” Doner wrote, successfully reducing poverty and achieving middle-income status. But too reliant on cheap labor and exports, Thailand’s growth soon stagnated. Quoting Somkiat Tangkitvanich and Nonarit Bisonyabut, Thailand had “industrialized without developing its own technology.” In other words, Thailand became addicted to quick and easy growth without laying the foundations for sustainable development.
That was written in the early years of the Prayut administation. Seven years later, Thailand’s economy remains stuck in a rut, with growth remaining sluggish and the path towards a long-term upward trajectory still unclear.
The Eastern Economic Corridor, one of the flagship policies of the Prayut administration, became much less frequently discussed after the departure of former deputy prime minister Somkid Jatusripitak from government. ‘Thailand 4.0,’ once Prayut’s key vision for upgrading the nation’s capabilities, now barely merits a mention by officials. The Prayut government’s various innovation initiatives, such as the National Innovation Catalog, has yet to fully bear fruit.
The government, of course, has not stopped trying to generate a new national strategy. Last year, Prayut announced a new three-pronged economic strategy, a pillar of which is turning Thailand into a global hub for producing electric vehicles. It’s unclear how this would improve Thailand’s long-term competitiveness, however, falling once again into the trap of industrialization without native innovation.
In December, the Prayut cabinet also greenlighted a plan to take Thailand towards developed country status by the year 2037. Part of the plan involves supporting research and development in science, technology, and innovation. However, as TDRI researcher Warakorn Awutpanyakul pointed out last year, Thailand spends relatively little on R&D compared to its peers. During Covid, the R&D budget was actually slashed by 43 percent. In addition, providing education and skills training for a workforce fit to innovate remains a matter of grave concern.
And now that elections have been called, attention must inevitably turn to how the different parties want to increase Thailand’s long-term competitiveness.
It isn’t at all surprising that relatively few parties has elucidated how they intend to take Thailand out of the middle-income trap; talking about research and development isn’t particularly sexy and won’t win many votes. Where this has been discussed, the policy offerings have often been vague.
The United Thai Nation Party and Palang Pracharath have focused mostly on promising to continue the current government’s policies. Tum laew, tum yu, tum tor, Prayut has said: I’ve done it, I’m doing it, I’ll continue doing it. Unfortunately, as much as Prayut has done, it is not enough for Thailand’s competitiveness.
So what have the other parties said? Pheu Thai has pledged that under its leadership Thailand will become the center of innovation in ASEAN by 2027. Aside from a promise to support R&D, how that can be achieved remains more or less a mystery. Move Forward, on the other hand, has released over 300 policy proposals, but aside from promising to jump-start a domestic chips industry, relatively few have to do with supporting Thai-led innovation.
Perhaps an issue is that when the parties think of innovation, they think not in terms of economic restructuring for a more competitive Thailand. That is why, at an event ostensibly to discuss innovation policy, some parties talked about carbon credits, using big data, or even paying water bills online. These are innovative policies, to be sure, and all good things. But are they policies that support the fundamental goal of pushing Thailand towards an innovation-driven economy?
What is heartening is that several parties do recognize the need to seek out new economic engines for Thailand. Both Move Forward and Chart Pattana Kla, for example, are proposing new budgets to support the creative industries. It would be a breath of fresh air to see the next government support Thailand’s “soft power,” a buzzword so often used in bureaucratic circles, with real substantive commitments. Worth recalling is the fact that currently the Creative Economy Agency, which is tasked with spearheading growth in Thailand’s creative industries à la South Korea’s Korea Creative Content Agency, receives a minuscule budget.
It is not enough for Thailand’s parties to simply sprinkle the word “innovation” here and there. Taking Thailand to developed country status and coming up with a credible program of economic restructuring in an increasingly competitive world, in a rush to make sure an aging Thailand grows rich before we grow old, is mission critical.
Few questions matter more for Thailand’s future, and it is our democratic duty to press the parties on how, exactly, they intend to steer the country forward towards meaningful growth.
This is the second two pieces on policies geared at Thailand’s long-term competitiveness. In the previous piece, I discussed how education and skills training deserves more attention in the run-up to the election.