Executives see much work ahead
Leaders call for major economic changes
published : 8 Oct 2021 at 04:33
newspaper section: Business
Thailand still requires a tremendous effort and an elaborate government plan to help its economy bounce back, particularly regarding digital transformation as it aims to improve competitiveness.
"Vaccination has to make the country safe before we can start to accept foreign tourists and rebuild demand," said Dillip Rajakarier, group chief executive of Minor International, at The Bangkok Post Forum 2021 "Resilient Thailand: Ways to Bounce Back", a virtual event on Thursday.
Last year, Europe and the US suffered the most from the outbreak, but mass vaccination campaigns helped them rebound quickly, while some Asian economies moved backwards, he said.
Thailand ranked in nearly the last position of the Covid-19 Recovery Index after taking a top spot in 2020, said Mr Rajakarier. The country had a one-year head start to plan and implement a robust vaccination campaign, but instead the government dawdled, he said.
Though the inoculation rate is improving and reopening plans have begun, Thailand could have done much more sooner to avoid the suffering we face today, said Mr Rajakarier.
The country still needs to do more to build up public confidence in seamless travel, he said.
Mr Rajakarier said based on his own experience enrolling in the Phuket sandbox, the complicated paperwork for the certificate of entry programme is an obstacle for visitors.
Even though tourist arrivals increased yearly prior to the outbreak, Thailand was losing ground to regional peers such as Vietnam, Laos and Cambodia, he said.
The country should provide a seamless travel experience and improve infrastructure while promoting tourism products, said Mr Rajakarier.
Tourism demand will largely be driven by domestic and regional leisure markets, as the Mice (meetings, incentives, conventions and exhibitions) segment plans their trips at least a year in advance.
"As soon as we make travel seamless, then demand will return," he said.
Mr Rajakarier said the experience of past calamities, including the bombing at the Ratchaprasong intersection, the Sars outbreak and the tsunami, have proved Thai tourism is resilient and can usually rebound within six months.
To revive the economy, the government's plan should take a balanced approach towards big corporations and small and medium-sized enterprises (SMEs), as each have different needs to restart their operations, he said.
One unified voice is needed to drive the economic recovery plan into the future, said Mr Rajakarier.
Minor rolled out business plans in three phases during the global crisis. The company's medium-term plan looks for business growth from enhanced cash flow and expansion, with eight new hotels under the Anantara brand set to open in Europe next year.
Long-term business beyond Covid-19 requires adaption to changes in booking patterns, customer segments and digital transformation.
He said the company assigned a new chief transformation officer to ensure the long-term vision will not be compromised by short-term actions, while focusing on controllable factors to grow the business in a sustainable way.
Speaking at the same event, Stanley Kang, chairman of the Joint Foreign Chambers of Commerce in Thailand, said the pandemic accelerated a lot of changes, including in digital technology, employment and environmental issues.
"We have growing concerns about the plight of SMEs, which make up 90% of businesses in Thailand," he said. "If SMEs fail to restructure their businesses to cope with such rapid changes, they are unlikely to survive in the long run."
According to Mr Kang, to increase competitiveness and widen opportunities for Thai SMEs, the country should speed up business restructuring and upgrade the ease of doing business, while economic reform should focus on value addition and a green economy to drive growth.
The government must reduce redundant regulations to ease doing business and create more jobs, while SMEs should be supported by state policy to adjust to new trends and allow them to compete with big operators, he said.
Mr Kang said the most important factor to attract foreign direct investment to Thailand is skill improvement for labourers and employees, especially in technology.
"Thailand should attract talented young people from abroad to work here, aiming to upgrade Thailand as the Silicon Valley of Asean, luring venture capital as well," he said.
Liberalising the service sector is another step for the country to promote economic growth and create more jobs, said Mr Kang.
The Thai economy needs to quickly transform itself in the post-pandemic era to cope with future challenges, said Prinn Panitchpakdi, deputy leader and head of the economic team for the Democratic Party.
Speaking at the forum, he said the country has passed the worst of the pandemic and the business sector must adapt.
"Even before Covid-19, blockchain, artificial intelligence, the Internet of Things, 5G and quantum computing were all threatening to change the economic order," said Mr Prinn. "The crisis accelerated the digital transformation and was a big wake-up call for us to come out of our comfort zone in terms of technology."
Companies need to change business models and reinvent production lines to suit the new economic landscape brought about by digital transformation, he said.
"We need to invest in R&D, especially in healthcare and education," Mr Prinn said. "We need to improve the quality and skills of our workforce because our current level is not competitive. The high levels of economic inequality are another major concern."