Thailand stands at a pivotal crossroads. While it has progressed from a low-income to an upper-middle-income economy, its path to high-income status faces formidable obstacles.
The looming threat of the middle-income trap -- stagnating growth, diminishing competitiveness, an ageing workforce and widening inequality -- casts a shadow over Thailand's economic aspirations. Meanwhile, climate change intensifies pressure on productivity, stability and innovation. Thailand's hard-earned ambitions are at risk unless it commits to an urgent pivot: integrating sustainability into its growth strategy.
With COP29 starting today, which carries a critical mandate to secure funding for a "course correction" in global climate action and revised climate plans due by February 2025, Thailand more than ever needs to focus on this issue given its international commitments. The World Bank's recent report, Towards a Green and Resilient Thailand, is an urgent call to action, outlining a path to an economy fortified by resilience, sustainability, and inclusive progress.
Thailand's Bio-Circular-Green (BCG) model, launched in 2021, laid the foundation for a sustainable, low-carbon economy. However, with rising climate threats -- including sea level rise, extreme weather and biodiversity loss -- a more ambitious approach is needed. The BCG+ model, introduced by the World Bank in this report, strengthens Thailand's green agenda by employing advanced modelling to anticipate and mitigate economic impacts.
Public-private collaboration will be essential, with policies such as carbon taxes, renewable energy incentives and circular economy practices forming the backbone of Thailand's future. The rewards are substantial: robust GDP growth, job creation and a stronger position in international markets increasingly shaped by green value chains.
To sustain growth, Thailand must tackle structural limitations that hold back economic resilience and diversification. Heavy reliance on tourism, agriculture and manufacturing leaves the economy vulnerable to shocks. Building a knowledge-based economy requires investment in education, research and technological innovation, alongside policies that prioritise environmental health. Embedding green principles into economic policy will accelerate Thailand's transition to a diversified, resilient economy.
Agriculture -- a critical pillar -- must transform to thrive in a changing climate. Employing roughly one-third of the workforce, the sector faces productivity declines from outdated practices and resource scarcity. Green technologies in farming, such as precision agriculture and efficient irrigation systems, will be key to increasing resilience and sustainability, securing food supply and reducing emissions.
Innovation across all sectors is equally vital. The adoption of green technologies -- from renewable energy to sustainable manufacturing -- will enable Thailand to meet global demand for eco-friendly products. Investment in research and development is essential for fostering innovations that address Thailand's unique challenges, creating an ecosystem for sustainable businesses that can drive job growth and resilience. By supporting startups and small-to-medium enterprises focused on green technology, the country can cultivate a thriving green economy that addresses both climate vulnerabilities and economic aspirations.
In a rapidly changing world, Thailand must also pursue inclusivity. The BCG+ model offers a pathway to address inequality through green jobs across skill levels, ensuring that vulnerable communities -- often the most impacted by climate change -- reap the benefits of a green economy. Equitable access to resources, healthcare and education, supported by policies promoting sustainable practices, will lay the foundation for a wealthier and fairer Thailand. By embracing a model prioritising environmental and social goals, Thailand can secure a prosperous, sustainable future.
The stakes are high, and the decisions made today will have lasting implications. A green and resilient Thailand is essential for the country's future. By integrating sustainability into economic strategies, Thailand can position itself not just for growth but for leadership in sustainable development. This approach not only benefits the environment but also enhances economic stability and social equity, contributing to a more sustainable future for all.
Muthukumara Mani is a Lead Environment and Climate Change Economist at the World Bank. Download the report: www.worldbank.org/thailand