International Institute for Management and Development (IMD), a leading business school with campuses in Switzerland and Singapore, released their 2015 World Competitiveness Ranking. Thai competitiveness dropped one spot in the rankings from 29th to 30th – the same spot it held back in 2012, and faced the third year of continuous decline since 2013 when the country was ranked 27th.
During times of instability, Thailand tends to suffer in business competitiveness rankings. After a military coup, the kingdom was under martial law for most of 2015 which continued into the first half of 2015.
In 2012, when Thailand declined from 27th to 30th, the nation was recovering from its largest flood in recent history which covered Bangkok and damaged investor confidence.
Recommendations from the IMD, however, place more emphasis on Thailand’s long-term challenges. The country was urged to promote innovative, high-value added industries to sustain growth over a longer period of time.
Other suggestions from the institute include for Thailand to reform its education and healthcare systems, as well implement measures to make its government and processes more transparent.
“A general analysis of the 2015 ranking shows that top countries are going back to the basics,” said Arturo Bris, the IMD World Competitiveness Centre’s director.
Thai Competitiveness Better in Some Ways than Others
Thailand’s best ranking is in the employment category. The nation benefits from one of the world’s lowest unemployment rates at just 0.54% at the end of 2014, comparing regionally with 7.6% in the Philippines and Malaysia’s 3.2%.
The kingdom was noted in the report for making the process of getting construction permits easier. Meanwhile, the health and environment category is Thailand’s weakest area at 54th. This can be attributed to an increase in activities such as deforestation, field burning, and water resources, as well as poor healthcare services in the country’s rural areas.
Business legislation and education are also ranked poorly at 51st and 48th respectively. The country has been criticized for having a noncompetitive public education system, and legislation is currently in a state of change under Thailand’s military government.
“Productivity and efficiency are in the driver’s seat of the competitiveness wagon. Companies in those countries are increasing their efforts to minimize their environmental impact and provide a strong organizational structure for workforces to thrive,” said Bris.
IMD also releases several other reports, one of which is its annual World Talent Report. It ranks countries based on their ability to attract, develop, and train talent. Thai competitiveness dropped seven places in the report from 27th to 34th amid political uncertainty in the World Talent Report’s latest edition.
A New Reason for Thailand to Compete
The ASEAN Economic Community, or AEC, is being implemented in December of this year. It should make the Southeast Asian region more competitive than ever.
The new economic union aims to promote a freer flow of trade, labor, and investment. While similar to the European Union in some ways, the AEC will be without a shared currency and a deeper political integration.
“There will be no shortage of funding coming from within ASEAN, the Asia Pacific or even the US and Europe. These investments can bring about badly needed capital for some countries, allowing them to leapfrog from the 20th century into the 21st in terms of competition in mature countries such as Thailand and Malaysia”, said a report by the United States International Trade Commission.
IMD’s report is one indicator of which countries may take an early lead when the AEC comes to fruition this December.
Singapore has long been the highest ranked country in Southeast Asia, climbing to third place in the world and taking over Switzerland’s spot. Malaysia is also scored highly ranked second in ASEAN, although it dropped to 14th place from 12th in 2014.
The Philippines and Indonesia are the last two of the five nations in ASEAN ranked by IMD. The former rose by one spot from 42 to 41, while the latter slid from 37 to 42.
- These 3 Countries Have Been Recession Proof - 22/06/2017
- Investing in Indonesia Property: The Ultimate Guide - 18/06/2017
- Best Currency in Asia: It’s Not What You Think - 15/06/2017
- These 3 Emerging Markets are Hardly Growing - 11/06/2017
- How to Invest in Thailand, and Should You? - 08/06/2017
- Investing in Philippines Property: The Ultimate Guide - 04/06/2017
- 3 Best Places to Buy Real Estate in Asia - 01/06/2017
- Reasons You Should Invest in Asia Right Now - 28/05/2017
- Don’t Invest in Myanmar, Here’s Why - 25/05/2017
- Investing in Hong Kong Property: The Ultimate Guide - 21/05/2017