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Experts predict boost in GDP growth from government's digital economy plans

Dec 28. 2014
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By Erich Parpart
The Nation

Government investment on preparing for the digital economy would directly contribute to the expansion of the economy next year and help support the growth of other economic engines - investment, government spending, exports and tourism - when it is fully
Vatsun Thirapatarapong, managing director of Cisco Systems (Thailand), said World Bank studies have shown that a country’s gross domestic product could expand by 1.3 per cent if Internet broadband users in that country increased by 10 per cent.
The Thai government’s plan to invest on hard infrastructure such as national broadband and other soft and service infrastructure would increase internet broadband users and government spending, which would eventually contribute to the expansion of the economy.
Internet broadband penetration in Thailand is 26 per cent of households. The country has more than 26 million Internet users, 33 million Line members and 28 million Facebook users.
“There are two perspectives to the digital economy that can help with the expansion of the economy. The first is the expected government spending for hard and soft infrastructure, which would increase capital in the economic system through the increase of capital spending,” he said.
The second happens once the county has established good broadband connectivity, via the increase of business output in each industry.
“For example, manufacturing could expand faster if there was good Internet connectivity since the internal system of businesses would be more effective. They can use IT (information technology) to create programs and sensors to save energy use in the production process and that would contribute to lower energy costs.
“Firms can use the money that they have saved to invest on the development of their company.”
The tourism industry can expect more visitors if there is better Internet linkage and connectivity since visitors can gain better access to tourist information such as the locations of restaurants and hotels. It would also help with the promotion of products and services.
Better connected government agencies and the single window or one-stop government service idea, which is part of the digital economy concept, would reduce the time spent on dealing with government regulations. 
The private sector would find it easier to do business if it could gain better access to government agencies. This could also attract more foreign businesses to invest in the country if the ease of doing business here has increased, he added.
Supant Mongkolsuthree, chairman of the Federation of Thai Industries and vice chairman of TKS Technologies Plc, said the digital economy would help industries cut costs. Acquiring business permits would be faster, easier and more transparent while e-commerce could provide another market channel for businesses.
In terms of exports, the national single window would allow greater access to information such as the tax payment process and import regulations. It would make things clearer and faster in terms of logistics and packaging. 
The FTI is drawing up proposals to support the development of the digital economy before handing them to the Information and Communication Technology (ICT) Ministry to adapt and use as part of the concept’s blueprint. 
Vatsun stressed that the government must continue developing the digital economy concept for it to be fully realised since “many flares have gone up about the digital economy idea but they all were extinguished afterwards because of the lack of continuity in development”.
Countries that have successfully implemented the concept like Singapore have been developing their digital economy concept for two decades and were still working on improving it.
“Digital economy development requires continuity in projects and policy in order to build on the success of each stage. The development of the concept must be transferred from each government to the next to guarantee that the idea will be successfully implemented. 
“If we work on it continuously, we will see major differences within three to five years,” he said.
“The current trend is the wave of transformation into the digital economy. We should look to the Canadian and Irish models and find out what they have done successfully and analyse what are their strengths and weaknesses before trying to adapt and use it as a springboard for our own development,” he added. 
ICT Minister Pornchai Rujiprapa said earlier this month that the draft Digital Economy for Economy and Social Bill would be submitted to the National Legislative Assembly (NLA) next month. The draft will be based on more than 10 existing laws such as the Computer Crime Act and E-commerce Act. 
A National Digital Economy Committee will be set up to formulate policies once the act has been approved by the NLA. The Digital Economy Office will function as its permanent secretariat. 
The ICT Ministry also plans to draw up six laws governing electronic transactions, computer crimes, cybersecurity, data privacy, digital economic activities and ICT industry promotion by February. It Bt3.7 billion to spend next year. 

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