1

Suvit Maesincee Chairman of the Ad Hoc Committee on

Thailand’s Vision and Future Design

National Reform Council

Thailand’s Strategic Position

The New Global Landscape

Transforming towards the First World Nation

Thailand’s Strategic Position

Socio-

Economic

Structure

Regime of Government

Foreign Threats

Cultural Orientation

Ayuddhaya Culture

Absolute Monarchy

Self-sufficient

Agricultural Society

Western Culture

Dealing with

Colonialism from the West

Industrialized,

Value

Added Society

Psuedo- Democracy

Globalized World Culture

Dealing with

Non-Conventional Threats

Innovation-

Driven

Society

Real Democracy

Under Constitutional Monarchy

Past Challenges 21st Century Challenges

Dealing with

Conventional Threats

Thailand is Passing through a Sea of Change

สวุิทย์ เมษินทรีย์, โลกปรับ ไทยเปล่ียน

The Mapping of Thailand’s Strategic Position

Political

Disorder Mature/Stable

Liberal Democracy

Mature/Stable

Market Economy

Stagnant/Chaotic

Economy

First World

Second World

Third World

•Thailand

• Singapore

• Vietnam

• India

• South Korea

• China • Malaysia

• Myanmar

Thailand has been left behind in the second world

by Singapore and South-Korea, who have moved

into the first sphere

Le

ad

er

Te

ch

no

log

y &

De

sig

n

Fo

llo

we

r

Cost Based

Comparative Advantage

Value Based

Italy

China

Thailand

Hong Kong

Thai Industries face a “Competitive Nutcracker”

Source: World Bank/BOI

Resource/Asset

Seeking FDI

Market

Seeking FDI

Network

Seeking FDI

Inve

stm

en

t V

alu

e

• Raw Materials

Abundance/Costs

• Low-cost Unskilled

Labor

• Skilled Labor

• Physical infrastructure

• Market Size

• Market Growth

• Competitive Structure

• Internal Infrastructure

• Customer Preference

• Manufacturing Plus

Dynamic Services

• Integration with Regional/

Global Markets

• High Quality Skill Based

and Human Capital

• Global Market Access

• International Investment

and Trade Agreement

• All Market Seeking Factors

Level of Sophistication in Host Country

Thailand’s Investment Positions

Thailand is unable to shift from a market seeking

FDI to a network seeking and knowledge-based FDI

IMD Overall Competitiveness Ranking, 2009 – 2013 (Out of 60 Countries)

Source: IMD Competitiveness Yearbook 2009 – 2013

5 4

3 1

3

15 14 16

10

18

21 23

19 18 20

27

30

27 26 26

38

43 41

39

43

39

42

37 35

42 40

35

32 31 30

0

5

10

15

20

25

30

35

40

45

50

2009 2010 2011 2012 2013

Sinapore

Malaysia

China

Thailand

Philoppines

Indonesia

India

Rank

Without a major economic and industrial restructure,

Thailand will be facing not a stagnation, but an

erosion of its competitiveness

The most serious problem for Thailand is it's long-

term competitiveness which is measured by the

quality of the human capital

Manpow

er

Str

uctu

re

Quality of Human Capital

High

Dynamic

Young

Aging

Low

• Thailand

• Africa

• China

• USA

• Scandinavia

• Japan

• India

• Malaysia

• Singapore

• South Korea

• Myanmar

Thailand is currently facing the middle

income trap

Innovation

Driven Economy

• Business

Sophistication

• Innovation

Factor

Driven Economy

• Institution

• Physical

Infrastructure

• Macroeconomic

Stability

• Basic Human

Capital

Efficiency

Driven Economy

• Higher Education

& Training

• Goods Market

Efficiency

• Labor Market

Efficiency

• Financial Market

Efficiency

• Technological

Readiness

• Market Size

High Income Low Income Middle Income

Thailand was ranked at the top as the

country with most income inequality in

Asia in the year 2010

Inequality Wealth

Disparity

Power

Disparity

Opportunity

Disparity

Elitist

Culture

Corruption

Not

Clean

& Clear

Not

Free

& Fair

Not

Care

&Share

Hyper-

Conflict

สวุิทย์ เมษินทรีย์, โลกปรับ ไทยเปลีย่น

Widespread inequality, coupled with the higher level of

corruption and elitist culture, have gradually turned the Thai

society into a socially destructive society

Economic

Wealth

Social

Well-being

Environmental

Wellness

Human

Wisdom

Developmental Imbalance

The developmental imbalance results in

unsustainable wealth creation

The New Global Landscape

Local

Global

Local Global Local Global Local Global

Sense of

Place

Sense of

Space

The New Global Landscape

One World

One Market

One Country

One Market

Global GDP %

1820 70 1913 50 73 2005

Developing Countries

Developed Countries

25

50

75

The Rise of the Rest The Triad

The Rest of the World The Rise of Asia

World Economic Structure

Source: The Economist

The Transition of World Economic Power

The New USA

Global Local

Glo

ba

l L

oca

l

• Terrorism

• Mass Production

of Refugees

• Extreme Poverty

• Genocide

• Civil War

• Financial Turmoil

• Economic Crises

• Pandemics

• Climate Change

Globalization of Risks &Threats

We are now facing many challenging issues

which have already transformed into global

commons

The Global

Economic Crisis

The Global

Financial Crisis

The

Commodity

Price Bubble

The Real

Estate Bubble

The Dot

Com Burst

The Asian

Financial Crisis

European

Sovereign Debt Crisis

1997 2009 2008 2012

Perpetual Crises

Along with global commons, we are now

experiencing perpetual crises

One of the most serious global commons is the

negative consequences of the climate change

Source: DB Research

Double

Winners

Double

Losers

Beneficiaries from Climate Change

under Government Control

Food

Industry

Tourism

Auto-

motive

Chemical

Industry

Textile

& Clothing

Building Materials,

Paper Industry

Metal Industry Energy Sector

(Fossil Fuels)

Renewable

Energies

Mechanical

& Electrical

Engineering

Finance Agriculture

& Forestry

Construction&

Associated Sector

Transportation

Regulatory

Market

Economy

Condition

(+)

(-)

Environmental Climate Dimension (+)

(-)

Beneficiaries from Government

Measures with Climate Risks

Climate change is affecting a wide range of

industries, some more than others

A Shift from Carbon-based to Post Carbon-

based Society

Post Carbon-Based

Society

Carbon-Based

Society

• Fossil Fuel • Renewable Energy

• Centralized Operations • Distributed Operations

• Hierarchical Structure • Collaborative Network

• Top to Bottom • Side by Side

Hundreds of millions of people will generate their own energy and sharing

energy with one another across intelligent distributed electricity networks—

and intergrid

The Challenging Issues

• Does Thailand have a clear and effective food & fuel security

policy?

• Does Thailand have an action plan to deal with the consequences

of the climate change?

• Does Thailand have a comprehensive plan to optimize its energy

mix?

• Does Thailand have a transition plan , migrating from the current

carbon-based energy dependence to a post carbon-based one?

Risks & Threats

Op

po

rtu

nit

ies

Thailand

ASEAN

Asia

World

• Climate

Change

• Endemic/

Chronic

Disease

• Economic

Crisis

North Korea

Terrorism

Political Turmoil

The Rise of Asia

Relationship w/ China, India

AEC

Mekong Region

Border

Conflict

Myanmar

Migration

The Rise of the Rest

The Age of Africa

Regional Hub

How well can Thailand deal with these global

risks & opportunities within the 4 different

landscapes

Transforming Thailand into a First World Nation

The 1st

Great Reform

The 2nd

Great Reform ? Colonization

Modernization

Globalization

Digitization

Democratization

Individualization

Urbanization

Commonization

Th

e W

ea

lth

of

Na

tio

n

Being responsive to change is crucial for

building national wealth

A Nation

at Risk

Normal

First World

Nation

Reform

Transformation

Status Quo

Th

e W

ealt

h o

f N

ati

on

Thailand urgently needs a new nation-building

model in order to deal with the new level of

global competition

Reform

Agenda

Transformation

Agenda

First

World

Second

World

Third

World

•Thailand

• Singapore

• Vietnam

• India

• South

Korea

• China

Roadmap for Rebuilding Thailand

Time

Reform Agenda

Anti-Corruption

& Governance

Central & Local

Government

Administration

Legal State

Rule of Law

Due Process of Law

Economic System,

Financial & Real

Sectors, Labor Forces

Human Capital,

Education, Science &

Technology, Culture and

Public Health

Natural Resources &

Environmental

Management,

Crisis Management

Press & Media

Autonomy &

Accountability

Social Welfare,

Community & People

Empowerment,

Consumer Protection

37 Selected

Reform Agendas

The NRC has identified many reform initiatives

covering 8 reform areas

The top priority is to tackle the issues

directly related to the 3 major challenges

Anti-Trust

& Competition

Law

Land

Reform

Tax

Structure

Reform

Social

Welfare

Anti-

Corruption

Scheme

Political

System

Reform

Police

Administrative

Reform

Government

Administrative

Governance

Consumer

Protection

Community-

Based

Financing

Hyper-

conflict

Inequality Corruption

Society with

Hyper-conflict

Society with

Inequality Society with

Corruption

Turning the current undesirable society into a

desirable one

Clean & Clear

Society

Free & Fair

Society

Care & Share

Society

Undesirable Society Desirable Society

Transformation Agenda

Crafting the New S-Curve V

alu

e C

reati

on

Normal S-Curve

Extending S-Curve

Shifting S-Curve

Self

Sufficient

Export

Agricultural

Products

Productivity

Improvement

Export

Know-How &

Technologies

Va

lue

Cre

ati

on

1948-1970 1970-1980 1980 up

Israel’s Agricultural Sector

Structural Transformation

Strategic

Intent Growth

Engine

Global

Connection

Model

Thailand’s Transformation Agenda

Thailand’s Strategic Intent

Strong

Economic Platform

Decent

Environment

Liveable

Society

Active

Global Player

The First

World

Nation

The First World Nation

Strong

Economic Platform

Decent

Environment

Livable

Society

Active

Global Player

• Balanced Growth

• A Productivity Driven Economy

• An Entrepreneurial Society

• A Competitive Work Force

• Enabled Eco-Structure

• World Class Infrastructure

• Globally Connected

• A strong Domestic Market

• Constructive Engagement in the Global Agenda

• A World Leader in Global Niches

• Thai Culture as Soft Power

• A regional Strategic Partnership

• Global Citizenship

• Internationalization of Thai Enterprises

• A Climate Resilient Economy

• A Low Carbon Society

• Green Growth Industries

• A Clean & Clear Society

• A Free & Fair Society

• A Care & Share Society

Thailand’s Strategic Intent…

Green

Growth Engine

Inclusive

Growth Engine

Productive

Growth Engine

New Growth Engines • Low Carbon Society

• Climate Resilient Economy

• Green Growth Industries

& Technologies

• Provincial Economic Cluster

• Community-Based Economy

• Favorable Environment for Business

Development

• SME competitiveness

• New Job Creation

• Retraining & Capacity Building

• Negative Income Tax

• Collaborative Networks

• Design & Technology

• R&D Capacity

• Venture Capital

• Technology/ Business Incubator

Sustainable

Value Creation

Economy

1960s 1970s 1980s 1990s 2000-2010s 2020s

Import

Substitution

Export

Promotion

Foreign Direct

Investment

Trade

Liberalization

Dual Track

Development

Leading

Trading

Nation

New Global Connection Model V

alu

e C

reati

on

One World

One Market

Local

Global

Local Global Local Global Local Global

One Country

One Market

Key

Driver

• Access to Market

• Access to Supply

• International Division of Labor

• Internationalization

of Capital

• Connectivity

• Competitive Driving Forces

• Center of Excellence

The Waves of Trading Nations

Trading Nation

1.0

Trading Nation

2.0

Trading Nation

3.0

New Global Connection Model…

Thailand’s Globally Connection Strategy

• Sourcing

• Supply Chains

• Head Quarter

• Branding

• Talent

• Etc.

Regional

Trading

Nation

Mature

Markets

Advanced

Markets

Emerging

Markets

• African Countries

• Middle East

• The US/Canada

• Western Europe

• Japan/South Korea

• China/India

• Russia

• Argentina/ Brazil/

• Chile/ Mexico

• South Africa

Thailand

Global

Trading

Nation

Thailand should aim to become the leading

regional trading nation first

Structural Transformation

Talent

Transformation

Competitive

Talents

Economic

Transformation

Sectoral

Transformation

Enterprise

Transformation

Enabling

Ecosystem

Global

Niches

Smart

Enterprises

Economic Transformation

• Entrepreneurial Society

• Market-led Economy

• Pro-competitive Institutional Framework

• Industry/Regional Cluster Development

• Special Economic Zone

• Logistic Hub

• Digital Platform

• Information Infrastructure

Enabling

Ecosystem

Structural Transformation…

R&D

IT, bio, space

& defense

Gov’t Services

Beijing/Tianjin

(Zhongguancun Area)

Chinese Industrial/Regional Clusters

Production area of

frozen vegetables &

processed food

Home appliances

Korean presence

Shangdong Area

IT/ PC

Electronice components

Taiwan hinterland

Chemicals &

Petrochemicals

Automobiles

Zhu Jiang Delta Area

Heavy Industry, aircraft

Software

Para-statal enterprises

Liaoning

(North-East Area)

Textiles

Automobiles

Laptop PCs

Mobile phone

Financial Institutions

Semiconductors

Chang Jiang Delta Area

Agricultural & Fishery

products

Taiwanes companies

Textiles

Tea

Xiamen/Fuzhou Area

Economic Transformation…

Tourism, Health, BT, Animation

Textiles, Electronics, Auto Machinery, Petrochemicals, Shipbuilding, NT

Three Free Economic Zones

BusanㆍJinhae

Gwangyang

Incheon

Cultural Industry, Bio, Auto Optical Fiber Cable, achinery

Honam

Kangwon

Youngnam

Finance, Logistics, Electronics, IT, Bio

Seoul Metro-Area

Logistics, Financial Services, etc.

Information, Bio, Tourism

Jeju

* 6 Industrial districts for foreign companies * 4 Free Trade Zones * 523 Industrial Complexes

Cultivating regional specialty industries toward a multi-core balanced national development

BT, Telecomm equipment, Semiconductor, Display

Choongcheong

Seoul

Free International City

Northeast Asian Hub

Planned Site of New Capital

Korean Industrial/Regional Clusters Economic Transformation…

Source :Marketing of the Nations

• Population 4 millions

• 90,000 SMEs covering 40%

of employment

• Stand alone and subcontractors

SMEs

• Supporting infrastructure:

transports, research center,

financial institutes, university,

laboratories

• Gain advantages of economies of

specialization

• Export-oriented and has capacity

to respond to market changes

and compete globally

Emilia-Romagna

Northern Italy’s Industrial/Regional Clusters

Economic Transformation…

Regional areas have played a major role in

bridging local potentials with global

opportunities

18 Clusters of Provinces

• Globally Competitive

• Regionally Competitive

• Nationally Competitive

Economic Transformation…

• Cultural Heritage (Ayuthaya)

• Ayuthaya Foreign Village

High Low

High

Low

Touch

Techn

olo

gy

• 38 University TU, AIT, RU, EU, BU

• Science park

• M-Tech

NECTECH

• Museum

• Rice Research

Center

Knowledge

Center in

Historical

Tourism

Knowledge

Center in

OTOP skill

development

Knowledge

Center in

Industrial

Technology

Research

Knowledge

Center in

Agriculture

Technology

research

Provincial Cluster Strategy Map ANG TONG, AYUTHAYA,

PATHUM THANI, NONTHABURI

Economic Transformation…

Sectoral Transformation

• Strategic Industry Portfolio

• Regional Head Quarter

• Industry Enabling Infrastructure

Global

Niches

Structural Transformation…

In the past decade, Thailand had identified 5

globally competitive industries based on its

cultural strength

Le

ve

l o

f S

op

his

tic

ati

on

High Tech

Low Tech

Foods Tourism

Fashion

Software

Auto

Level of Customization

Low Touch High Touch

Cultural

Strengths

Craftsmanship

Skills

Peace

of Mind

Delicate

Living

Flavorful

Sense

Sectoral Transformation…

Emerging

Extending

“Lift-off”

Time

Valu

e C

reate

d Chemicals Chemicals

Food Food

Pharmaceuticals Pharmaceuticals

Health Services Health

Services Medical

Equipment Medical

Equipment

Bio-Based Industrial Cluster Development

Pharmaceuticals Medical Services

Food Food

Pharmaceuticals Medical Services

Food Food

Sectoral Transformation…

Enterprise Transformation

• New Business Models

• Globally Connected Networks

• Enterprise-based Enabling

Infrastructure

• Benchmarking, Best/Next

Practices

• Management Skills

• Open Source Application

Smart

Enterprises

Structural Transformation…

Smart Enterprises in the World of Change

• Value Added

• Individuals

• Propensity to Imitate

• Following the Rules of

the Game

• Maintaining the Status Quo

• Value Creation

• Co-creation

• Propensity to Innovate

• Changing the Rules of

the Game

• Responding to Change

Ordinary

Enterprises

Smart

Enterprises

Enterprise Transformation…

Future Store

Future Health

Future Fashion

Future Travel

Future Food

Future Makers

• From branded boutiques to online marketplaces

• Increasingly personal, predictive and positive

• More individual and intelligent wellbeing

• Harnessing technology and data to enable

high performance

• Delivering richer and more authentic experiences,

supported by premium brands and new business

models

• Become smart and on-demand

• Responsive to global aspirations of connected

markets and customized to local needs

In the global economy of the 21st Century, there are many changes in the business models

• Driven by new business models, new

categories and extreme experiences

Gamechangers

Future Store

Future Health Future Fashion

Future Travel

Future Food

Future Makers

• Amazon

• Positive Luxury

• Aussie Farmers Direct

• Trader Joe’s

The New Business Models : Examples

• 23and Me

• Organova

• Epocrates

• Intuitive Surgical

• Toms

• Rapha

• Patagonia

• Ashmei

• Zipcars

• Air Asia

• Virgin Galactic

• Red Bus

• Nespresso

• Zespri

• Moa Beer

• LA Organic • Tesla

• GE

• 3D Hubs

• Space X Gamechangers

Enterprise Transformation…

4 M

od

es o

f S

up

ply

Cross Border

Supply

Consumption

Abroad

Commercial

Presence

Movement of

Natural Persons

• Tourism

• Travel to another country

to obtain a medical

treatment

• Banks / Hospitals setting

up operations in another

country

• Internet services

• Telemedicine

• Purchase of medicines

or advice o the Internet

• Services provided by

software engineers,

doctors or nurses

These new business models connect to the

world markets via the 4 modes of supply

Local

Regional

Global

Bu

sin

ess M

od

els

Enterprise Transformation…

Talent Transformation

• National Manpower Planning

• Pool of Skilled Labor

• Pool of Knowledge Workers

• Collective Intelligence

Competitive

Talents

National Manpower

Planning

Managing

Stock of Talents

Managing

Flow of Talents

Talent

Market

Talent Capacity

Buildng

Talent Welfare &

Protection

Talent

Productivity

National

Productivity

National

Competitiveness

National

Interests

• Vocational

Education

• Higher

Education

• Corporate

University

• Talent Mobility

Comprehensive & Proactive Manpower Planning

Technology is dramatically changing the way

people live, learn and work, by enhancing

personal capabilities & productivity

Competency

enhanced

Access to

relevant

information

Increased

productivity

Empowered Citizens Ordinary Citizens

Limited

capability

Low

efficiency

Low

productivity

Talent Transformation…

Global

Responsiveness

Local

Inclusiveness

National

Competitiveness

Sustainable

Growth

Secured

Peace

Shared

Prosperity

Reform

Agenda

Transformation

Agenda

Vision Thailand

First World

Nation

Strategic Thrust Rebuilding Roadmap Expected Outcomes

A nation with

• Hope

• Happiness

• Harmony

People with

• Head

• Hand

• Health

• Heart

Wealth of the Nation

Peo

ple

We

ll-b

ein

gs

Thailand: The Decade Ahead

Every morning in Africa, a gazelle wakes up.

It knows it must run faster than the fastest

lion or it will be killed.

Every morning a lion wakes up.

It knows it must outrun the slowest gazelle or

it will starve to death.

It does not matter whether you are a lion or a

gazelle.

When the sun comes up, you had better start

running.

African Proverb

“If You want to go quickly,

go alone;

if you want to go far,

go together.”

African Proverb

“It is not the strongest of

the species that survive,

nor the most intelligent,

but the one most

responsive to change.”

Charles Darwin