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Chapter | Education & Health from The Report: Thailand 2014

After years of rapid economic expansion and population growth, Thailand’s education system is facing strong challenges in areas such as quality and enrolment, the rural-urban divide, links between business and academia, and policy continuity. In September 2013 the education minister established a special committee to assess Thailand’s decline in international rankings for education and to produce a list of needed reforms. Education is the basis of Thailand’s efforts to become a more knowledge-based society, and to move away from its low-wage, low-cost model of development. Given the swift approach of more ASEAN integration and the importance of overseas markets to Thailand’s economic development, education is also vital to the country’s future competitiveness. Meanwhile, Thailand has reached nearly all of its Millennium Development Goals (MDGs) in health ahead of schedule, prompting it to pursue an MDG-Plus strategy in recent years. The biggest lunge forward for Thailand’s health care system has been the introduction of a form of universal health care. Not only has this brought many benefits to ordinary Thais, it has provided coverage to individuals who may have previously been unable to afford health care services. The public system has at the same time been working in tandem with private care, whose high-quality services have made the country a top choice for medical tourism for the region and the world. Funding the universal system is likely to be the most pressing issue in the years ahead. The private sector, too, looks likely to continue its expansion, especially in the provinces, with opportunities for foreign investors in medical education and training, equipment, and supplies. This chapter contains interviews with Pirom Kamolratanakul, President, Chulalongkorn University; and Worsak Kanok-Nukulchai, President, Asian Institute of Technology.

Chapter | Tourism from The Report: Thailand 2014

The 26.7m international arrivals in 2013 represented a 20% rise on 2012. China was the top source of visitors with a 6.9% increase to 4.7m. Next came Malaysia (2.99m), Russia (1.73m), Japan (1.53m), South Korea (1.29m), Laos (1.1m) and India (1.04m). The Tourism Authority of Thailand set 28.01m visitors as the goal for 2014. The Tourism Council of Thailand is more optimistic, forecasting 29.92m foreign tourist arrivals, with revenue up 18% to $44.1bn, over 2013’s estimated $37.9bn. Visitor numbers are expected to continue to grow, so maintaining infrastructure development will be key to ensuring the industry keeps up. The long-term relationships within the ASEAN Economic Community, and Thailand’s role as the largest and strongest tourist market in the region, will likely be on the agenda of many meetings. This chapter contains an interview with Manit Boonchim, Executive Director, Planning Department, Tourism Authority of Thailand.

Chapter | IT & Telecoms from The Report: Thailand 2014

With the country continuing its telecoms development, Thailand’s internet connectivity is about to improve exponentially. Wireless speeds are on their way up and wireless access is expanding rapidly. In 2001 the passing of the Telecommunications Business Act established three types of licenses: one for internet service providers without a network, one for those with infrastructure, and one for private networks. In the second quarter of 2013 Thailand’s broadband adoption rate was up 191% quarter-on-quarter. In addition, the country ranked 39th in the world in terms of broadband adoption and 22nd in terms of connection speed. The local data centre business is forecast to expand by 21% in 2013 to around $56m, due to the adoption of cloud computing, the need for disaster recovery and the increasing connectivity within the ASEAN region. The outlook for the telecoms sector is more positive than it has been in years. Given the 3G auction and the bright prospects for 4G, companies are set to see their business improve, and customers will likely benefit from better performance. This chapter contains interviews with Anudith Nakornthap, Minister of Information and Communication Technology; Pete Bodharamik, CEO, Jasmine International; and Jon Eddy Abdullah, CEO, Total Access Communication.

Chapter | Construction & Real Estate from The Report: Thailand 2014

Even though the minimum wage has gone up and there is no shortage of work, the construction sector in Thailand is facing a serious dearth of labourers. As developments in neighbouring countries have increased employment opportunities there and the minimum wage has risen across Thailand, companies have faced difficulties in finding workers for building sites. However, despite some setbacks following floods in late 2011, the sector has been resilient and grew by more than 7.5% over 2012, a trend likely to continue in the years ahead. In order to facilitate new projects under the government’s infrastructure drive, a new public-private partnership law has been designed to encourage private investment by making regulations more transparent and clear. Meanwhile, the rise of the middle class has maintained the affordability of purchasing property and there is especially high demand for condominiums in Bangkok. While prospective foreign buyers, especially from Russia and China, are seeking to get onto the property ladder, restrictions on foreign ownership and financing remain in place. The advent of the AEC at the end of 2015 may have a profound effect on the market as well. This chapter contains interviews with Yuthachai Charanachitta, President and CEO, ITALTHAI Group; Apichart Chutrakul, CEO, Sansiri; and Chanond Ruangkritya, President and CEO, Ananda Development.

Chapter | Transport from The Report: Thailand 2014

The Thai government is planning to build four high-speed rail lines linking Bangkok with the northern city of Chiang Mai, the Laotian border, the industrialised eastern seaboard and Malaysia, effectively joining all corners of the country. Thailand’s infrastructure plan aims to reduce the ratio of logistics costs to GDP by 2% from its current 15.2%, increase the speed of non-high-speed trains and boost the percentage of freight carried by rail from 2.5 to 5. Meanwhile, reopened to help relieve congestion at Suvarnabhumi Airport, Don Mueang Airport is also overcrowded, handling 16m passengers a year despite its capacity for 10.5m. The renovation of the airport’s second terminal will boost capacity to at least 20m. Located at the centre of the ASEAN Economic Community, which is due to take effect from December 2015, Thailand is positioning itself as the regional transport hub. It is opening transfer depots and centres in anticipation of an increase in trade, while shipping is also set to benefit. Vast improvements to neglected areas of the country’s infrastructure are also important for Thailand’s future economic wellbeing, irrespective of the AEC. This chapter contains interviews with Chadchart Sittipunt, Minister of Transport; Sorajak Kasemsuvan, Former President, Thai Airways International; and Prapat Chongsanguan, Governor, State Railway of Thailand.

Chapter | Industry & Retail from The Report: Thailand 2014

On the economic road from farms to factories to services, Thailand has come a long way. Through a combination of low costs, sound policy, a good work ethic and a relative lack of labour activism, the country has managed to make the transition from an economy based on agriculture and commodities to become one of the most industry-oriented nations in the world. Manufacturing makes up 34% of the Thai economy, a larger portion than in all of its regional competitors, and Thailand is the world’s 17th-largest manufacturer and number 14 car maker. Industry value-added in Thailand rose from 18.5% of GDP in 1960 to a high of 44.7% in 2007. Exports grew rapidly over the same period, while agriculture shrank as a portion of GDP. Thailand’s minimum wage law was applied across the country as of January 1, 2013, settling the rate at $9.09 per day. This raised the average wage by 22.4% nationwide, and in some provinces by as much as 70%. Investors in manufacturing are attracted by the prospect of having assemblers and suppliers in multiple ASEAN countries, which would reduce risk as there would be no single bottleneck. If Thailand can move gently to the next generation of production, great rewards await. This chapter contains an interview with Prasert Boonchaisuk, Minister of Industry.

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