Thailand: Thai Businesses Learning to Develop Themselves Online

Thailand is the second-biggest economy in the South East Asia region that enjoys sustained growth and a yearly reduction in poverty. However, this was not always the case, as Thailand previously struggled. Just seven years ago, Thailand had a growth rate not much above 1% and was teetering on the edge of a possible recession.

However, rather than accept its fate, the country made quick and decisive decisions that have quickly reversed its fortunes. Those in power and with the ability to make decisions decided a change was needed. They realised they had to digitalise the country if they were to grow as a country. This meant revising its economic model so that Thailand could create its own advanced digital generation.

Going Towards a New and Digital Economy

It was 2016 when the government put in place Thailand 4.0, a new economic model aimed at taking advantage of advancing digital technologies. The government first formed an agreement with Alibaba, a Chinese multinational country that wanted to help the country’s ailing e-commerce sector.

As part of this agreement, Alibaba pledged to provide full training for up to 30,000 SMEs that would boost the chances of success of internet startups. Training would include everything from setting up a website using a website creator, starting online businesses such as eCommerce stores, marketing those businesses, growing them, and how to succeed against the competition.

Results Came Quickly

The boost to the economy has come rapidly, as Thailand’s people continually embraced this new digital revolution. Digital wallets and online payment technologies quickly pushed the country towards a more cashless economy. Banks in the country made enormous investments in digitalisation in the past few years and that has led to continual growth in the number of transactions completed via mobile and internet banking systems.

In the first year alone, those transactions increased by almost 85%. They were now accounting for almost a third of all payment transactions compared to under a tenth in 2010. Thais were now turning to make payments online instead of offline.

Big brands such as LINE, Garena, Lazada, and Grab emerged to take full advantage of this new way of doing things. Thais were now buying their goods online, ordering food, and anything else they could utilise without handing over physical cash.

COVID Only Increased this Reliance on a Digital Economy

Of course, while the implications of COVID-19 have been felt worldwide, it certainly aided many sectors. Thailand could not have made the move towards a digital economy at a better time. Lockdowns, travel restrictions, and social distancing measures only pushed the country’s reliance on its new and flourishing digital mindset. Those still to adopt a digital world were now forced into it. Cashless transactions and deliveries were now the norms for many families across the country.

Ecommerce Growth to Continue According to Analysts

Experts believe that this growth will only continue to increase in the coming years. Thailand is now one of the most digitised countries in SouthEast Asia. Almost three-quarters of the population actively use Facebook with other social media platforms, also accounting for tremendous growth in usage. As a result, social media has boosted eCommerce sales to around $12 billion each year.

The usage of online taxi bookings, parcel deliveries, food deliveries, and online shopping is predicted to continue its growth as more people realise the convenience of it all.

Still Concerns for Other Industries

While the new digital economy is booming in Thailand, there is still an enormous concern for the agricultural and tourism industries. While COVID primarily caused these concerns, the country is still looking at ways to ease the burden.

Thailand usually has a flourishing tourism industry, but the global pandemic has hampered this greatly. If anything, the digitalisation of the country has helped to offset many of those struggles. That said, the country is now ready to open itself up to tourists. In a test run, Thailand is allowing visitors to Phuket, in a bid to help the economy.

Only fully vaccinated visitors can travel to the island, which officials believe would have built up the natural herd immunity required to prevent a fresh wave of infections. Should the sandbox experiment prove successful, the government will consider opening up other popular tourist destinations around the country.

Summary

Thailand certainly deserves plaudits for how it has escaped the jaws of recession to become one of the fastest-growing economies in Southeast Asia. Especially when you consider it did this within just a few short years. The turnaround has been significant, and it will be interesting to see how this new digital economy transforms the country further in the next few years. We predict that Thailand will continue to be among the Southeast Asia leaders when it comes to the digital revolution!