New World Bank Report Maps Thailand Beyond Bangkok-Led Growth

 

A new World Bank report launched in Bangkok says Thailand must lift growth to 5.4 per cent a year to reach high-income status by 2037, not 2048.

 

On present trends, Thailand will not become a high-income country until around 2048. A new World Bank report launched on Thursday sets out what it would take to get there more than a decade sooner — by 2037 — and argues that doing so will require Thailand to more than double its per capita growth rate and rebuild the model that has driven its economy for the past 35 years.

 

"Building Thailand's Future Today" was unveiled at the Bangkok Business Summit: Reinvent Thailand, Resilient ASEAN, by Stephen Ndegwa, World Bank Division Director for Thailand and Myanmar; Katherine Anne Stapleton, World Bank Senior Economist; and Kwanpadh Suddhi-Dhamakit, World Bank Thailand Senior Country Officer, in a session moderated by Annie Koh of Singapore Management University.

 

The launch was timed deliberately: Bangkok will host the IMF-World Bank Group Annual Meetings in October, its first time doing so since 1991, and the report's authors framed it as a stocktake of what that earlier era of growth achieved — and why it can no longer be relied upon.

 

 

 

Why now: a 35-year model running out of road

Stapleton opened by contrasting Thailand today with the country the World Bank last met in back in 1991, when close to 40 per cent of the population lived below the lower-middle-income poverty line and roughly two-thirds worked in agriculture.

 

Since then, Thailand has created around 11 million formal jobs from a workforce of about 40 million, more than doubled GDP per capita, and nearly eliminated poverty at the $4.2-a-day line, alongside sizeable gains in life expectancy and human development.
 

 

 

 

That momentum has since faded. Growth has slowed markedly since the global financial crisis and, over the past few years, has averaged just 2.2 per cent since the Covid-19 pandemic — a pace that would leave Thailand reaching high-income status only around 2048.

 

The report's central proposition is that lifting annual real GDP per capita growth to 5.4 per cent over the next decade could instead deliver that milestone by 2037, and it decomposes that target into a 2.9 per cent baseline potential growth rate, topped up by an additional 2.5 percentage points from four reform areas: 0.8 points from new industries, 0.7 from more dynamic firms, 0.7 from a stronger workforce, and 0.4 from more productive cities.

 

 

 

Two imperatives: upgrading and dynamism

The report is built around two "mutually reinforcing" priorities, Ndegwa said: upgrading, meaning Thailand must move further into higher-value activity, and dynamism, meaning the gains from that upgrading must reach a far wider base of firms, workers and cities rather than concentrating among a narrow set of large, already-productive companies.

 

On upgrading, the report identifies five "industries of the future" — advanced manufacturing (electronics, electrical appliances and EVs), digital services (ICT, fintech, professional services and startups), sustainable and wellness tourism, agrifood, and creative industries — selected, Kwanpadh said, by weighing global demand shifts from AI, the energy transition and changing trade patterns against where Thailand holds genuine comparative advantage and against each sector's job multiplier.

 

 

 

He stressed the list emerged from 18 months of consultation with government, business, academia and civil society rather than being a World Bank prescription.

 

On dynamism, the report points to a stark competitiveness gap: Thailand has only around 10 startups per million people, against roughly 1,000 in Singapore, and about two new firms per 1,000 workers, against eight in high-income economies.

 

Despite exports running near 70 per cent of GDP, foreign investment is delivering weaker spillovers to domestic firms than it should, and R&D spending sits at only around 1 per cent of GDP, against roughly 2.5 per cent across East Asia and Pacific peers.

 

The report sets a target of raising small and medium-sized enterprises' share of national R&D spending from about 8 per cent today to the OECD average of around 20 per cent.

 

 

On the workforce, Stapleton cited Thailand's education gap directly: only around 1 per cent of Thai 15-year-olds rank as top performers in mathematics, against roughly 9 per cent across the OECD and up to 25 per cent in Singapore, while tertiary enrolment stands at 45 per cent, against about 82 per cent in high-income countries.

 

Alongside expanding schooling and tertiary access, the report flags raising female labour-force participation as a priority, noting that closing the gap between male and female participation could nearly offset the workforce decline expected from Thailand's rapidly ageing population.

 

On cities, the report calls for a portfolio of competitive secondary cities beyond Bangkok — better connected by transport, greener and more resilient to flooding — alongside a Bangkok that becomes denser, cleaner and more innovative rather than remaining the country's sole engine of growth.

 

 

 

Ten priorities and an unexpected favourite

From the full set of recommendations, the report highlights ten "no-regrets" priorities spanning all four pillars, from leveraging data-centre investment and easing digital services trade restrictions to improving SME access to finance, strengthening STEM and AI skills, and scaling up clean energy and flood resilience in secondary cities.

 

Fielding an audience question on why creative industries made the list — a sector currently contributing only around 5 per cent of GDP — Kwanpadh pointed to South Korea as a model of how film, digital content and design have become major drivers of high-skilled job creation elsewhere and argued Thailand already has real strength in film, digital content, jewellery and the arts to build on.

 

The central challenge, he said, is converting Thai culture and creativity into globally scalable intellectual property, which in turn requires stronger financing mechanisms to support that growth.

 

Closing the session, Ndegwa described the report as an invitation rather than a prescription — a basis for government and business to translate its recommendations into implementation as Thailand prepares to host the world's economic and financial leaders in October.

 

The World Bank Group, he said, remains committed to bringing global knowledge, financing and implementation experience to support the reforms the report sets out, with the Annual Meetings offering both a deadline and a platform to show how far that work has progressed.