Fall in competitiveness rankings blamed on external factors
THAILAND'S competitiveness rankings have fallen slightly this year because of its high vulnerability to external factors, but other factors show improvement, said Tevin Vongvanicha, chairman of Thailand Management Association's Centre for Competitiveness.
Thailand is in 30th place on the International Institute for Management Development (IMD) global competitiveness list and 32nd on the World Economic Forum’s list this year.
“This year, Thailand’s rank dropped by one place on both the IMD and WEF lists, given that its economy, which relies on exports, was highly sensitive to external factors, particularly China’s economic slowdown,” said Tevin, who is also chief executive of PTT, the country’s largest energy conglomerate.
Thailand may have to be cautious over China’s economic slowdown, the US Federal Reserve’s likely interest-rate increases, money-market volatility and capital outflows from emerging markets, he said.
Others factors affecting the country’s competitiveness ranking have seen improvement.
They include state-sector efficiency, business-sector efficiency and infrastructure.
Thailand’s ranking for infrastructure, “particularly in science, technology and innovation, went up from 54th to 48th place on the WEF list. It has become important for increasing national income, and a major weapon to add value to Thailand’s products and services in the global markets,” Tevin said.
Thailand’s research and development investment rose from 0.39 per cent to 0.48 per cent of the gross domestic product.
On the IMD list, Thailand was ranked third for employment, given its low unemployment rate and good labour market. The country came first among 51 countries ranked by Bloomberg’s so-called Misery Index, which is based on inflation and unemployment, with the lowest score.
“Global fund managers said they had been increasing investment in the Thai stock market, which is most attractive after China’s stock markets as Thailand is the happiest economy,” Tevin said.
Thailand’s ability to adjust state policy to economic changes, state decision-making, and state policy transparency also saw improvements, with lower corruption and less problems with political stability, reflecting more confidence in the government administration.
The country’s short-term stimulus measures are expected to gain confidence and boost liquidity in the economic system from late 2015 into 2016.
“Thailand’s next target is to move from being an efficiency-driven country to an innovation-driven one with higher national income. Upgrading competitiveness with sustainability requires science, technology and innovation, human-resource development and cooperation between the public and private sectors,” Tevin said.
