In the 2021 International Institute for Management Development World Competitiveness Rankings, Thailand achieved a ranking of 28, almost unchanged from its ranking of 29 in 2020. The country improved its position in government and business efficiency. The Thai economy (as of this writing) is expected to grow three to four percent annually over the next three years (2022-2024). Growth is supported by the gradual easing of COVID-19-related public health measures. In addition, widespread changes to societal behavior and the adoption of the ‘new normal,’ combined with rapid advances towards digitalization, are also stimulating greater demand for goods and services among groups affected by these developments.
The Thai tourism sector is expected to gradually recover with Thailand’s reopening to foreign arrivals at the end of 2021. Nevertheless, the persistence of strict COVID border controls in some originating countries and uncertainty over the possibility of new outbreaks will continue to weigh on the sector. International arrivals are not expected to return to their pre-pandemic levels of more than 40 million visitors until 2025. The Tourism Authority of Thailand (TAT) launched a new marketing campaign for 2022 called “Visit Thailand Year 2022: Amazing New Chapters.” The campaign will promote medical tourism, tourism to beaches, and shopping. Thailand is already a leading destination for medical tourism, offering competitive treatment costs, which can be more than are 80 percent lower than those in the United States. In terms of accreditation, there are now 66 medical establishments in Thailand that have been certified by the Joint Commission International (JCI) for their treatment standards.
Over the next few years, an acceleration in spending on government-backed megaprojects will provide a boost to the economy. Notable planned infrastructure projects include a high-speed rail-link connecting the three airports in the Bangkok region; the development of U-Tapao Airport and the Eastern Airport City; Phase 3 of the Laem Chabang Port development; and Phase 3 of the Map Ta Phut Port expansion.
Other notable projects include:
- The Bangkok-Nakhon Ratchasima high-speed rail line (part of the Thailand-China line). The first phase is currently under construction and is expected to begin operations in 2026. The second phase of the rail project from Nakhon Ratchasima to Nong Khai covers 167 kilometers, and it is expected to receive cabinet approval in 2022.
- A 16.4 km extension of the Bang Khun Tien-Ban Phaeo section of the M82 motorway.
- Expansion of Terminal 2 on the northern side of Suvarnabhumi Airport and Phase 3 expansion of Don Muang Airport, both expected to be completed by 2024.
If infrastructure development is carried out as planned, it may open opportunities for investment in downstream and related industries across the region, including in the production of electrical vehicles (EVs), modern medicines, smart electronics, digital technology, and the modern agriculture and future food industries.
Thailand’s implementation of the Power Development Plan (PDP 2022) and related programs will likely result in several changes. Renewables generating capacity will increase, while the share of electricity coming from fossil fuels will decline. Support for power plants running on biomass or biogas and for waste-to-energy schemes will increase. The market will fully open to supplies of power including grid-connected roof-top solar installations, and further investment will be encouraged in battery technology and alternative energy storage. The electricity transmission system will be overhauled to increase its flexibility and its reach will be extended into areas that have high potential as sources of alternative energy. The market for the importation of LNG will be fully opened, allowing new private sector players to source and ship LNG, lowering domestic prices for natural gas.
The introduction of tighter regulations on vehicle exhaust (part of plans to reduce PM 2.5 pollution) has been postponed. Euro 5 and Euro 6 regulations were scheduled for introduction in 2021 and 2022, respectively, but this has now been pushed back to 2024 and 2025.
The Building Energy Code (BEC) lays out fresh energy-saving requirements that cover the design and construction of new buildings. The BEC will affect nine types of structures: clinics and hospitals, offices, apartment buildings, meeting halls, theatres and cinemas, hotels, bars and nightclubs, educational institutions, shopping centers and department stores. The BEC is already in force for buildings with a footprint of 10,000 square meters. For venues larger than 5,000 and 2,000 square meters, the new rules will be enforced in 2022 and 2023, respectively. This will raise costs related to design, construction, and renovation.
Thailand is the 13th largest food exporter in the world, with over 10,000 food and beverage processing factories. The Ministry of Industry reported that the food industry performed impressively in 2021, both in food exports and food manufacturing. The food manufacturing industry achieved an overall growth of 4.5 percent.