Talent, regulation and capital needed for Thai economy to recover
Thailand needs to attract digital talent and invest more in education for it to boost its competitiveness in the current economic climate. That is the key message that came out of a recent IMD webinar, organized in collaboration with Thai Listed Companies Association (TLCA) and Care for Thai Biz, exploring the South East Asian country’s prospects for recovery.
The global Covid crisis has accelerated technological change across all sectors worldwide and digital competitiveness is key to the future health of the Thai economy.
Sharing insights for the future, Professor Arturo Bris, Director of the IMD World Competitiveness Center, and Professor of Finance at IMD, explored Thailand’s perspectives for recovery and shared insights for the future. He told executives in Thailand that the competitiveness of economies is now more important than ever and that how economies overcome their competitive challenges will determine how they perform in the new normal.
Identifying digital and talent competitiveness challenges
The drive towards digital transformation in Thailand will only be beneficial if it leads to a future that works, with more automation, productivity and employment. Although technological change will replace some jobs, the country’s digital transformation must create more jobs and long-term growth. People displaced by automation must be able to find other employment in technology and related sectors.
For Thailand to become a digital hub in the region, it needs talent, regulation and capital. The United States, for example – the most digitally competitive economy in the world – has created a digital ecosystem that attracts the best talent from leading universities both at home and abroad, an efficient regulatory framework that favours digital transformation, and funding for technological development through stock market capitalization and venture capital.
Ranked 39th out of 63 economies worldwide in IMD’s World Digital Competitiveness Report 2020, Thailand has room for improvement in terms of talent (digital skills) and public expenditure on education, as well as business agility.
In the not-too-distant future, many jobs will look quite different from the ones that exist today. The education system needs to prepare young people for the future. “Investing in education will pay off in the long-term, particularly in the areas of robotics, AI, blockchain and other digital technologies,” said Professor Bris.
In the meantime, companies operating in Thailand can look to fill the digital talent gap through training and hiring abroad. What we’re seeing today is that it is possible to attract talent from anywhere, and with the growing trend of remote work, education and talent attraction may matter more or less, depending on the economy. “Talent competitiveness still matters, increasing competition and productivity, benchmarking home-grown talent and forcing local talent to upskill” added Bris.
Government policies matter more than ever
Another main point of discussion was about possible solutions to the current crisis through the lens of the competitiveness model. “An economy’s competitiveness will impact the way it navigates the recovery.”
Last year Thailand ranked 29th overall out of 63 economies across the globe in IMD’s World Competitiveness Report 2020 – down from 25th in 2019. Competitiveness provides the framework to recognize the factors that facilitate prosperity. It is a tool and an objective of economic policy.
Drawing from Thailand’s performance in the rankings and his experience working with clients in Thailand, Professor Bris remarked “the private sector has been the engine of Thailand’s competitiveness”.
Now that Covid has changed the rules of the game, participants recognized that economies’ performance will largely depend on the quality of government policies to alleviate the economic damage of the pandemic. Government efficiency, particularly in terms of institutional framework, is likely to be a competitive challenge as the economy responds to the current crisis.
Fixes and solutions
ASEAN’s second largest economy is also being held back by its ranking in infrastructure, including technological and scientific infrastructure as well as health and education.
“If Thailand wants to become more competitive, it needs to invest in reliable infrastructure. It also needs to ensure policy stability and predictability, create a business-friendly environment as well as an effective legal environment, build a strong R&D culture, and invest in a skilled workforce and education system.”
Globalization may have slowed down because of the Covid pandemic, but it’s likely to be a short-term trend with an increase in virtual globalization. In an interactive session, participants concluded “digital competitiveness is key to the future progress of the country” and investment in developing digital talent should “match skills to future jobs.”
Commenting on the webinar, Dr. Nattavut Kulnides, CEO of ADGES and Content Director for Care for Thai Biz said, “It is a great honour to have Professor Bris share his perspectives and I hope his insights strongly resonated with our leaders and organizations, as we work towards a common goal of improving the future competitiveness of our Thai economy.”
The IMD World Competitiveness Center is dedicated to the advancement of knowledge on world competitiveness by offering benchmarking services for countries and companies using the latest and most relevant data on the subject.