Picture courtesy of Competitive Intelligence Agency

 

Thailand has achieved a significant milestone by surpassing Malaysia in the IMD World Competitiveness Centre’s global rankings for the first time in a decade, now positioned as the second most competitive nation in Southeast Asia behind Singapore. Despite this accomplishment, experts caution that Thailand’s ascent may be fleeting due to persistent structural issues, insufficient budget allocations, and a lack of a strategic long-term vision.

 

According to the National Economic and Social Development Council (NESDC), while Thailand has made notable progress, its high-tech export performance continues to lag behind countries like Vietnam, signaling the need for urgent innovation and digital advancement. The report highlights that although awareness of these challenges has been present for years, investment to address them has in fact decreased. The share of the national budget devoted to enhancing competitiveness has dwindled from 16.1% in 2018 to just 9.7% by 2025.

 

In contrast, spending on social equity programs, such as universal healthcare and education, has significantly increased, consuming 24.7% of the 2025 budget, while the costs associated with state operations and debt servicing have grown to 18.5%.

 

Dr Nonarit Bisonyabut from the Thailand Development Research Institute pointed out that nearly 70% of the national budget is locked in salaries, debt servicing, and welfare, leaving limited funds for essential development and investment activities. He advocates for a budget overhaul, proposing a move towards a zero-based budgeting system, where each expense must be annually justified. However, he advises that this could disrupt ongoing projects and instead suggests a balanced strategy that accommodates existing projects while fostering opportunities for high-impact initiatives.

 

 

 

Thailand’s economic strategy has been criticised for its lack of focus, unlike Malaysia’s semiconductor industry specialisation or Vietnam’s strategic integration into South Korea’s supply chains. Experts recommend shifting away from broad policies towards investment in specific high-return sectors, which could initially be costly but offer substantial long-term benefits.

 

The IMD World Competitiveness Ranking, which evaluates nations on economic performance, government efficiency, business efficiency, and infrastructure, placed Singapore at the top globally in 2024, with Thailand ranking second in Southeast Asia, followed by Indonesia, Malaysia, and the Philippines.

 

The NESDC warns that Thailand needs to enhance efforts in emerging industries, agricultural technology, and domestic value chain management to maintain its competitive position. Additional looming challenges include an ageing population, skill mismatches, lack of innovation, and sluggish public sector reform.

 

With Thailand's improved standing on the global stage, the focus shifts to whether the nation can sustain this competitive edge by addressing these pivotal challenges head-on, reported The Thaiger.

 

-- 2025-04-16

 

 

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We support the transition to a new model that balances prosperity and growth with ecological sustainability and social inclusion. Sustainability and diversity, equity, and inclusion are in our DNA.

 

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On 4/16/2025 at 10:47 AM, snoop1130 said:

Thailand has achieved a significant milestone by surpassing Malaysia in the IMD World Competitiveness Centre’s global rankings for the first time in a decade,

 

I didn't know it was a competition.