State to focus on four key areas

At a seminar held by the Economic Reporters Association, Deputy Prime Minister Somkid Jatusripitak said the government intends to build on the ‘solid foundations’ laid down in recent years. KRIT PROMSAKA NA SAKOLNAKORN

With about one year left in office, the government says it will focus on four areas: the digital economy, infrastructure development, agricultural reform and local economic development via 18 provincial clusters.

Speaking at yesterday’s seminar entitled “2017: Thailand’s Turning Point” held by the Economic Reporters Association, Deputy Prime Minister Somkid Jatusripitak said 2017 would be a year of execution for those four areas, which are seen as instrumental in upgrading Thailand’s competitiveness and strengthening the economy.

“Over the last two years, the government has already laid down solid foundations for future economic and social development, especially via amendments of key existing laws to facilitate trade, investment and social reforms,” Mr Somkid said.

Regarding the digital economy, the government has already earmarked 15 billion baht to develop the national broadband network and submarine cable project, he said.

“Prime Minister Prayut Chan-o-cha himself has ordered the national broadband network and submarine cable project to be completed this year after being delayed from last year,” Mr Somkid said.

“If the two projects fail to be completed within this year, it will affect many other state development plans such as high technology and tech startups development, e-commerce promotion among small and medium-sized enterprises, the smart farmer programme and education reform.”

This year, according to Mr Somkid, the government is committed to developing key infrastructure projects, especially the double-track rail networks that will upgrade Thailand’s logistics capacity and competitiveness.

The government is also pinning hopes on the Eastern Economic Corridor (EEC), which will run through Chon Buri, Rayong and Chachoengsao, expecting the law governing the development of the EEC to be enforced within the first quarter.

Mr Somkid said agricultural reform should continue, particularly the smart farmer project to help farmers develop their own businesses.

“Farmers need to get more training to sell or export their products via e-commerce, while agricultural communities should have their own brands,” he said. “The farm sector will be supported with machinery in order to cut their production costs, and the Bank for Agriculture and Agricultural Cooperatives, the Agriculture Ministry and Village Funds are required to engage more in farm sector reform.”

In addition, the government will focus this year on integrating state budgets which are now scattered among various state agencies and local administrations and beef up local economy development.

“The government will this year allocate an additional 100 billion baht from the mid-year budget for local development of the 18 clusters of provinces, while 300 billion baht in leftover funds now controlled by the local administrative organisations will be set aside for local development that will help stimulate the domestic economy or bring about a better balance between the external and domestic economies.”

He forecast economic growth of 3-4% this year and put 2016’s growth at 3.2%.

In a related development, finance permanent secretary Somchai Sujjapongse said yesterday that a 10-billion-baht Competitiveness Fund will be set up this year as a tool to solicit foreign investment with a focus on research and development and innovation.

The fund is a part of the new Competitiveness Fund Act, under which a committee on enhancing the country’s competitiveness chaired by the prime minister will be incorporated to attract targeted industries to invest in Thailand.

The government hopes the 10 target industries will help economic growth reach its full potential of 4-5%. The 10 sectors are: automotive and auto parts, including electric vehicles; smart electronics; affluent, medical and wellness tourism; agriculture and biotechnology; food; robotics for industry; logistics and aviation; biofuels and biochemicals; digital; and medical services.

The draft will come into force this year.

The Competitiveness Fund will grant investment incentives to the targeted industries and Mr Somchai is confident the fund is able to offer such incentives, which are on par with Singapore’s offering.

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