Smart cities to support Thailand's transition to a knowledge-based economy

Smart cities form an essential component in the government’s broader vision of transforming Thailand into a high-income, knowledge-based economy. The ultimate aim is to create 100 smart cities across all 77 provinces by 2040, with an initial focus on three pilot cities in Phuket, Chiang Mai and Khon Kaen. The initiative is being supported by the state-owned CAT Telecom, which is working to introduce high-speed internet infrastructure in these cities. Beyond the three pilot projects, the next priority is to establish smart cities in Chonburi, Rayong and Chachoengsao – the site of the Eastern Economic Corridor (EEC).

Approximately BT300m ($8.7m) in public funds has been earmarked for smart city development in 2018 and the – as yet unpublished – master plan is expected to incentivise public-private partnerships. Furthermore, to support the initiative the government has established the National Smart City Steering Committee. “The committee’s goal is to alleviate any obstacle to smart city implementation, including laws and regulations” Supakorn Siddhichai, vice president of the Smart City Promotion Department of the Digital Economy Promotion Agency (depa), told OBG.

New Incentives

In an effort to support business growth and catalyse private investment in the country the government amended regulations in May 2018 to provide tax exemptions for import tax, along with corporate income tax. Further tax incentives were introduced by the Board of Investment (BOI) to support the development of smart cities. Centred around a corporate income tax waiver of eight years, the BOI incentives are designed to attract investment in telecoms infrastructure and smart solutions in transport, energy and education.

Playing To Its Strenghts

As it moves forward with its plans, the committee can learn from other smart cities within South-east Asia, particularly Singapore. Early indications are that Thailand is playing to its strengths and seeking to capitalise on the unique characteristics of its designated smart cities. In Phuket, a popular tourist destination, the smart city concept is being tailored to support the cities most dynamic pre-existing industry. This involves using technology to improve local services and enhance the experience for visitors and locals alike. For example, the Smart Phuket app is intended to provide users with city information, emergency alerts and news updates, while being connected to an e-payment gateway that can be used for hotel reservations and food purchases. Meanwhile, the city’s CCTV will be linked to video analytics and government data centres to deter and prevent crime.

In the EEC, smart cities will be catered towards nurturing smart manufacturing, which is in line with the government’s plans to develop the industrial heartland into a centre for high-value manufacturing. Among advocates of smart city development, a debate continues about the most appropriate management structure for the cities. For example, Teeranun Srihong, chairman of the Board of Commissioners of depa, is pushing for a bottom-up approach, although he still believes the government has a crucial role to play. “The government can help establish standards, so all technology can be connected and its use regulated,” Teeranun told OBG. “But when it comes to choosing partners, we would prefer to have the private sector working with the community, rather than relying only on the government.”

Privacy Challenges

Nevertheless, these plans do face certain obstacles. The development and application of smart city solutions requires the management of big data. This creates problems related both to data privacy and to vulnerability to cybersecurity threats. Nevertheless, depa has established a Data Protection Knowledge Centre to manage this issue, and on top of these efforts, the country is in the process of developing its first ever data protection law, which is expected to enter into force in mid-2018.