A return to normal is not good enough
That sadly is not the case for working Thais today. We need to recapture the zest and the sense of the possible that we had in the past. I believe to do this we need to start at the top -- the government itself -- and the starting point is with the mindset of those in power.
The Thai economy lacked vibrancy even before we were hit by Covid-19 in March 2020. The most alarming indicator of this is the sharp drop in investments, both foreign and domestic and both direct and through the stock market. Therefore, it is not enough to be working towards a “return to normal”. Frankly, normal is not going to be good enough.
I returned to Thailand in 1988 after over a decade studying and working overseas. I was 23 years old and whilst I had the privilege of choice to work or live anywhere I wanted, there was never a doubt that I would return to start a business back home. Thailand at that time offered the best opportunity for me and my peers, including to foreigners who flocked to our country in that period, to enjoy the benefits of a vibrant society and a booming economy. In macro terms, income from industrial production had just a couple of years earlier surpassed income from agriculture. Income per capita of Thais tripled between the years 1988 and 1996. In short, there was no place in the world as exciting to invest, live and work at that time as Thailand.
That sadly is not the case for working Thais today. We need to recapture the zest and the sense of the possible that we had in the past. I believe to do this we need to start at the top -- the government itself -- and the starting point is with the mindset of those in power.
Because of Covid, we understand more than ever that we live in a world of VUCA -- volatility, uncertainty, complexity, and ambiguity. The only certainty is uncertainty. Even today, a couple of weeks after the prime minister announced that the country would reopen in 120 days, no one can say with any certainty whether there will be sufficient vaccines to protect us from the ever-mutating virus. In this environment, what is needed is a mass of data and data analytic capability. Most importantly, we need a government and supporting bureaucracy that is extremely agile. This past year has shown that our government and bureaucracy do not have the tools, structure, culture or mindset to be sufficiently responsive to a VUCA world.
The starting point must be to reform how the government operates. Today we have the tools to do this: technology. But to do this we need a new mindset. When the SEC [Securities and Exchange Commission] recently announced new controls over the trading of crypto assets, there was scant consultation and the resulting set of new rules sent all the wrong signals to developers that will only result in a slowdown of innovation and migration of skills to a more welcoming environment. This reflects the prevailing mindset and without a different set of attitudes, no change and little innovation can take place. However, once a new mindset is in place at the top policy level, we can learn from others how technology might be best applied to make the changes we want to see.
There are good examples to be studied from the UK, South Korea, Taiwan or Sweden amongst others. But the most complete case of how GovTech (Government Technology) can be developed to provide efficient service to citizens is in the country of Estonia. Estonians can interact with their government in every activity via their mobile device, except when they get married or buy a house, when they actually have to show themselves physically. This implies a low-priced bureaucracy that is both efficient and transparent. Transparency means no corruption, no bias and no hiding behind conflicting sets of rules that make life impossible for honest citizens. I believe that Thailand needs to commit to upgrading its government services in this way.
One important result of this is that the government will become less of a burden to the taxpayer. We have one of the most expensive bureaucracies relative to national budget in Asia, if not the world. Swedes may pay more tax than us (50 per cent of GDP compared to 17 per cent for us) but 80 per cent of their budget flows right back to their citizens. In Thailand, almost 100 per cent of our tax revenue goes towards keeping the bureaucracy running. The government had to borrow massively through an executive decree in order to supplement loss of income to individuals during the Covid period. GovTech will allow less tax money to be used to oil the wheels of government and more to look after the well-being of the Thai people.
A commitment to GovTech and the resulting Big Data will enable us to better find our new growth area (so-called new S-Curve). GovTech necessitates a modernisation of our laws and regulations. This will allow the creation of an experimental ‘sandbox’ to develop new businesses and ideas in tech and even agriculture.
There are other changes that need to be made, especially in the fields of education but it all needs to start with the modernisation of our government and bureaucracy. Only then can we see efficient decentralisation and accountability from the government that we have the right to expect.
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(Korn Chatikavanij was Finance Minister from 2008 to 2011)
