Commercial property and residential condo buildings are pictured in Bangkok on March 10, 2020. (ALEX OGLE / AFP)
Thailand's digital economy, seen key to the country's post-pandemic recovery, needs more government support and policy stability to grow, experts say.
The World Bank said in a report released on Dec 14 that the adoption of digital technologies has the potential to support Thailand's recovery from COVID-19 and ensure a more competitive economy over the longer term.
Digital-led development can help offset the scarring impact of the pandemic and ensure that growth is inclusive and equitable, said Birgit Hansl, the World Bank's country manager for Thailand.
Digital-led development can help offset the scarring impact of the pandemic and ensure that growth is inclusive and equitable, said Birgit Hansl, the World Bank's country manager for Thailand
Since the pandemic took hold in Thailand in March last year, new digital service consumers have comprised 30 percent of the country's total, and consumption among internet users has reached 90 percent, the second-highest in the region after Singapore, the report said.
The pandemic has accelerated digitalization in businesses, government and individuals' behaviors, said Arthur Gogatz, associate professor at King Mongkut's Institute of Technology Ladkrabang in Bangkok.
Yet Gogatz, also the director of consultancy World Innovation Team, told China Daily it will still be "a tough call" to diversify the tourism-dependent economy through digitalization, mainly due to a lack of specific planning and policy uncertainties.
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"Digitalization here is on a fast track but … the track is not organized," said Gogatz, adding a digitalization gap between different social classes presents another challenge.
Pawee Jenweeranon, lecturer in law at Thammasat University in Thailand, said there are several key legal and regulatory gaps in the country's digital ecosystem, including conditions in Thai laws that make digital companies hesitant to invest, along with policy uncertainty and lack of standards around data handling and security.
Pawee said that while Thailand enacted the Personal Data Protection Act in May 2019 as its first consolidated law to govern data protection, a delay in selecting committee members and rolling out subordinate legislations has made the situation uncertain and created challenges for businesses.
Although the Thai government has provided basic digital infrastructure over the past decade, Pawee said for Southeast Asia's second-biggest economy, the country's digital innovation ecosystem remains small in contrast, with its limited number of digital solution firms.
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"We need to advance agile responsive and resilient approaches in adopting new technologies and in preparing for the future of digital government and sustainable development," said Pawee, noting existing regulations should be amended to support digital transformation.
Voraprapa Nakavachara, assistant professor of economics at Chulalongkorn University in Thailand, said she expects the growth of e-commerce, online streaming, digital payments and lending to continue even after the pandemic.
Voraprapa said it is a good sign that the Thai government understands the importance of digital technology and its role in supporting the economy, noting government efforts to boost digital funding.
The government has allocated 2.4 billion baht ($71.83 million) for the 2022 fiscal year to continue the implementation of six key projects under the Thailand Digital Government Plan, including a welfare platform and one related to data development for the agricultural sector, Bangkok Post reported on Dec 13. The figure represents an increase of 20 percent from the previous fiscal year.
"Banks and large corporations are also moving fast to adopt financial technologies and investing in them," said Tridbodi Arunanondchai, vice-chairman and group CEO of fintech startup Lightnet.
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Noting the central banks of China and Thailand are jointly working on a cross-border digital currency project, Tridbodi said he expects more seamless and efficient trade finance between China and Thailand.
The People's Bank of China – China's central bank – and those of Thailand and the United Arab Emirates, together with the Hong Kong Monetary Authority, launched in February the Multiple Central Bank Digital Currency Bridge to study the cross-border use of central bank digital currencies.
Voraprapa from Chulalongkorn University said Thailand has benefited from the local presence Chinese tech giants, including Alibaba, Tencent and Huawei.
"As Thailand still has potential growth in the digital economy, I think Chinese investments and Chinese business' presence in Thailand could benefit both countries," said Voraprapa.
kelly@chinadailyapac.com