Thailand 4.0 & Development Plans for the Future

Thailand 4.0 & Development Plans for the Future

Over the years, we’ve been hearing of plans for “Thailand 4.0 Model,” which is meant to push Thailand forward into a country that’s more technologically advanced and innovative. What other plans does Thailand have in mind to develop this country?

Since ASEAN’s establishment in 1967, it’s been promoting peace and stability in the regions, with the aim to accelerate economic growth of the member nations, which are Brunei, Cambodia, Indonesia Laos, Malaysia, Myanmar, The Philippines, Singapore, Thailand, and Vietnam. The ASEASN Economic Community (AEC) was established in 2015. The ASEAN Free Trade Area was created in 1992 by members to increase intra-ASEAN trade and investments, to increase and attract foreign investment, which has grown over the years. Despite weakening global trade, Thailand has been performing relatively well, even during challenging times. 

Thailand’s 4.0 Development from the agricultural stage
The Four Ages of Thailand
Thailand 1.0: Agricultural society
Thailand 2.0: Light industrial age
Thailand 3.0: Heavy industrial age
Thailand 4.0: Value based economy

-    Economic model that aims to unlock the country from several economic challenges resulting from past economic development models which places emphasis on agriculture (Thailand 1.0), light industry (Thailand 2.0) and advanced industry (Thailand 3.0). These challenges include a “middle income trap”, “an inequality trap” and “an imbalanced trap.” 

-    Four objectives of Thailand 4.0
o    Economic Prosperity- to create a value-based economy that is driven by innovation, technology and creativity. The model aims to increase Research and Development (R&D) expenditure to 4% of GDP, increase economic growth rate to full capacity rate of 5-6% within 5 years, and increase national income per capita from 5,470 USD in 2014 to 15,000 USD by 2032.
o    Social Well-being: to create a society that moves forward without leaving anyone behind (inclusive society) through realization of the full potential of all members of society. The goals are to reduce social disparity from 0.465 in 2013 to 0.36 in 2032, completely transform to social welfare system within 20 years and develop at least 20,000 households into “Smart Farmers”
o    Raising Human Values: to transform Thais into “Competent human beings in the 21sth Century” and “Thais 4.0 in the first world. Measures under Thailand 4.0 will raise Thailand HDI from 0.722 to 0.8 or the top 50 countries within 10 years, ensure that at least 5 Thai universities are ranked amongst the world’s top 100 higher education institution within 20 years.
o    Environmental Protection: to become a livable society that possesses an economic system capable of adjusting to climate change and low carbon society. The targets are to develop at least 10 cities into the world’s most livable cities, and reduce terrorism risk.
Does this have an impact on real estate? 
As the AEC promotes trade, import/exports, as well as helps boost various industries, this can have a direct and indirect impact on other industries. 
 

With more foreign investments coming in, and Thailand in the center of the ASEAN economic region, it brings in more opportunities for work and creating businesses, which leads to steady flow of expats and immigrants into the country. This can be beneficial to Thai and foreign investors, as there’s going to be a demand for residential places. Despite fluctuations in the real estate market due to the global economy, natural disasters, and political instabilities, the market has been resilient, and bounces back fast, with good yields and growth.  Regardless of the industry, the aim of AEC is to promote global and regional economic growth, which will hopefully have a positive impact. 
 

Sources: Ministry of Commerce, The ASEAN Post, Bangkok Post, The Nation Thailand, Thailand Industry Outlook Krungsri Research