With 2019 now well underway, distinct themes are beginning to emerge that are likely to shape global economic developments for the remainder of the year. Amid likely slowdowns within some of the major world economies, developing regions such as ASEAN will have a golden opportunity to take the initiative. The question is whether key countries such as Thailand will make the necessary adjustments in order to capitalise on their good fortune.
The US and China are entering a stage of their trade war that seems likely to solidify into a longer-term stalemate unless the main issues between them are resolved. Even setting the trade war aside, however, both of these countries face an extra set of problems within their own borders. The US government shutdown – the longest in its history – was a symptom of the political unease in Washington. And China’s economic slowdown will similarly test the strength of its leadership to steer the ship forward without a strong economy to prop it up.
In Europe, the unresolved issues surrounding Brexit continue to disrupt the UK’s ability to plan for its economic future. Political movements elsewhere, including the continuing Yellow Vests protests in France, suggest that the anticipated global economic slowdown in 2019 could lead to some tense moments in governance.
Thailand may also feel the effects of that slowdown, but fears of recession seem unwarranted as a modest but steady outlook is expected for the year. Overall, Thailand’s economic foundation remains strong and its position as chair of ASEAN offers the valuable opportunity of demonstrating leadership in the region at the very moment that its opportunity to positively impact the global economy is at its greatest.
With a growing middle class, strong workforce, powerful investment base, and incentive programmes through the BOI, Thailand’s business potential is formidable. But we live in a time of technology-based disruption, and Thai companies have yet to show that they are agile and adaptable enough to build forward-looking business models that can withstand disruption from outside. AI, robotics, 3D printing, and data analytics are expected to play a big role in the coming decade – which means that Thai companies must be ready to take full advantage of these technologies.
To succeed in today’s rapidly evolving digital era, companies in Thailand will need to show a real willingness to adopt new ways of doing business. Low overhead will be a necessity for many companies, as will flexible business models, innovative ideas, and a keen sense of which way the wind is blowing.
The next 12-24 months will separate the companies that are prepared for this fast-moving digital ecosystem, from the ones still stuck with old and outdated internal structures. Thailand’s government needs to facilitate speedier access to business licences and incentive programmes across various industries, but companies must also do their part to usher in the new era of advanced business that the new wave of international investors has come to expect.
By making the necessary adjustments when real opportunities are available and ASEAN’s regional spotlight is shining directly on Thailand, business leaders and politicians can show the way forward for a new decade of growth and prosperity across the region.