At a dinner presentation at the Amari Patong, Chris Bruton, executive director of Dataconsult Ltd, a 40-year veteran of Thailand, made a number of other predictions about Thailand in 2020. Among them:
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The hospitality industry will become increasingly polarised between high-end Western and Asian visitors, and mass tourism, with the result that the industry must adapt to handle both types – Phuket will be an important factor in growth;
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Urbanisation will accelerate, particularly in secondary cities connected to the capital by high-speed trains, such as Korat, Chonburi, Sattahip and Rayong, and later, other cities in the centre, south, northeast and north;
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Bangkok traffic will once again descend into gridlock, necessitating limits on vehicle access to some parts;
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Labour-intensive industry will move to the borders to gain access to cheaper labour from Cambodia, Laos and Myanmar.
The greying of the country will have significant implications, he noted. “The average farmer is now in his 50s. Efficiency in farming is desperately needed. Thailand is the biggest producer of rice yet also the least efficient. How come Dutch farmers drive around in Mercedes Benzes? It’s because of efficiency.”
He predicted that although people will work shorter hours, longer life-spans will mean they will work past the age of 65, which will pose challenges for retirement financing provisions.
Despite many announcements being made about educational reform, he said, “Nothing has been done. Even if reform takes place it will take a long time. It’s going to be a major issue.”
That said, he predicted that, five years from now education and healthcare will catch up with demand, with smaller enrollments for education and better healthcare for the ageing.
As to business, he pointed out that the form of government is less important to investors than what it delivers, the three most important factors being stability, bureacratic efficiency and rule of law, all of which need improving.
He predicted that government instability will remain a worrisome factor, but that corruption – though it will not go away – will reduce “maybe in a Thai-style compromise”.
As for rule of law, Mr Bruton said, “Rule of law is not given enough importance. An enormous gap remains between law and fair enforcement, not just in Thailand but in most of the countries of [Southeast Asia]. Thailand is not the worst but it needs improving.”
He added, “[Under military rule] the police are now very much constrained and are much more careful in the way they deal with the law.” But the question, he said, is whether this would continue after a return to democracy.
On the bright side, he thanked the US and Europe for their negative reactions to military rule, which had resulted in a “a great gift” – Chinese, Japanese and to a lesser extent Korean support.
“While Westerners tend to ask, ‘but what if...’ or ‘I’m not sure that will work’, the Chinese, Japanese and Koreans says, ‘Let’s just do it.’
“We should be grateful to the US and Europe for strengthening Asian relations.”
Class Act Media was a sponsor of the event. The next Phuket Business Dinner is scheduled for May 28.