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Longterm planning crucial to Thailand's future: experts

Publication Date : 01-08-2012

 

Thailand's business operators and academics yesterday said the government should draw up a clear-cut, long-term strategic plan, delegate power within state agencies and engage in deregulation, promotion and support in terms of infrastructure in order to take the Kingdom forward into a dynamic future global economy.

Ideas and suggestions were addressed at the "Thailand at the Crossroads" seminar", held by the newly established Thailand Future Foundation, an independent mediator that aims to prod think-tanks into helping the state make the right decisions in further developing the country.

The foundation is led by former finance minister Somkid Jatrusripitak and has among its collaborators well-known figures in the financial industry, such as former Bank of Thailand governor Chaiwat Wibulsawasdi and ex-finance minister Thanong Bhidaya as directors.

The foundation is also supported by leading companies, who are represented as directors on an advisory board. Among them are Bangkok Bank, True Corp, Thai Union Frozen Products, Central Group, Mitr Phol Sugar Group and Thai Beverage.

Sethaput Suthiwart-Narueput, executive chairman of the foundation and formerly head of the Siam Commercial Bank Economic Intelligence Centre, said the authorities should be brave in making tough decisions on complex matters in order to ensure a bright future, as they had done in the past.

Use of the Key Performance Index (KPI) is instrumental in helping authorities shape long-term strategies, he said, as the index is a better performance indicator than other traditional measures.

Stressing the importance of having long-term policiesfor the country's development, he mentioned that less than a quarter of the government's revenue is used for investment, and that the proportion is falling.

He presented examples of key past decisions that had positively affected the country.

"Had we not taken steps to increase foreign direct investment, our exports today may be as much as 25 per cent lower. Furthermore, FDI provided us with the opportunity to build economic clusters, such as those in the automotive and electronics sectors. The Eastern Seaboard has led us into petroleum and petrochemical production. At present, Map Ta Phut is the most prominent oil production site in Southeast Asia and is ranked as the world's seventh-largest site. Similarly, the tourism industry has created a great number of jobs and opportunities," Sethaput said.

Chaiwat delivered an opening speech that sent a clear message that he believed human capital is the key to development.

Commenting that Thailand faced the risk of lacking a skilled workforce amid an ageing society, he said having a skilled and socially responsible labour was essential.

Thanong, meanwhile, said those at the top in the state sector should delegate power to subordinates, as they would be the ones implementing planned policies enabling many projects, especially mega-investment in infrastructure, to proceed.

Business operators told the forum that the government should support and promote the private sector to do business both domestically and internationally.

Nitinai Sirismatthakarn, a director of the foundation, said the four pillars of development were the population, the public sector, the private sector, and infrastructure and innovation.

While ordinary indexes suggest the outlook in these areas is bright, the KPI reveals the harsh truth, he said.

"There have been very few policies involving unemployment, as the unemployment rate is low at 1per cent. However, digging deeper, we will see that 45 percent of those unemployed are youths, and this should be a major concern," he said. "Only 25 per cent of the workforce works in the same field as what they have studied, hence there has been no increase in real salary values."

The private sector looks problematic as well, he said. The five largest businesses contribute 21per cent of tax, suggesting the weakness of small and medium-sized enterprises. However, the KPI shows that 78per cent of the workforce are in SMEs.

In addition, although more patents have been registered in recent years, only one-third are owned by Thais, Nitinai said.

"The inference we can draw is that there is very little funding for research and development," he added.

"The Thailand Future Foundation is like a new wave of thought for the future of Thailand ... Let's hope that this will be a [new] beginning for all participants," said Somkid.

 

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