The rapid expansion in its electronic industrial sector is evidence of Thailand’s success in transferring foreign technology into the country. Thailand is considered as one of the newly industrialized country in the South-East Asian region with its emerging economy. Thailand had a 2013 GDP of US$673 billion (on a purchasing power parity [PPP] basis). Its economy is the 2nd largest in the South-East Asia after Indonesia. Thailand ranks midway in the wealth spread in South-East Asia as it is the 4th richest nation according to GDP per capita after Singapore, Brunei Darussalam and Malaysia. The electrical and electronics industry has played an increasingly important role in Thailand’s economy. The government of Thailand has launched proactive investment policies and measures, which have attracted investments from many multi- national companies and led the industry to prosperity in Thailand. Investment promotion, development of science and technology capabilities and implementation of measures supporting the development of the electronics industry have been important components of the national development strategy83. The Government created several initiatives to promote technology
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manpower training and education, establishment of incubators and science parks and provision of grants. The National Science and Technology Development Agency (NSTDA) established the Industrial Consultancy Services in 1992 to promote the use of local and foreign technical consultants and facilitate the formation of alliances. In 1997, the National Science and Technology Development Agency set up the Software Park Thailand (SPT) to promote innovation and facilitate development of start-up firms. Furthermore, the Board of Investment also developed the Unit for Industrial Linkage Development (BUILD) programme to encourage the development of support industries, strengthen linkages and help small and medium-sized contract manufacturers improve their productivity and facilitate cooperation between foreign and domestic firms84. These policies have played a vital role in making
Thailand a major manufacturer of electronic products and facilitated the acquisition of the skills needed to operate and manage production facilities to assemble intermediate and final electronic products. They have also played an important role in encouraging the development of local contract manufacturers and the transfer and development of technologies. The investment agencies and the science and technology institutions have played a critical role in the industrialization of Thailand. The investment policy measures developed by the Thailand Board of Investment (BOI) promoted Thailand as a favorable destination for export-oriented foreign direct investment85. On the other hand, the science and technology policies facilitated transfer
of technology and promoted the development of the technological base. The international competitiveness of the Thai electronics industry has largely been based on successful acquisition and adaptation of foreign technology86. Thailand has successfully established and maintained
effective access to external sources of technology necessary for building the technical, organizational and management skills needed to produce and distribute products and services efficiently. This has mainly been achieved through appropriate incentives to attract FDI and promote trade. FDI is an efficient channel for acquiring advanced technologies, as the investor may meet the cost of technology transfer, its adaptation and use. Investors may also introduce new managerial and marketing know-how. Thailand is a good example of a country that has exploited FDI and trade to acquire technology in its quest to industrialize. Thailand has been one of the major FDI recipients in South-East Asia over the past two decades (Brimble and
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Sherman, 1999; Mephokee, 2002). In 2011, the electrical and electronics industry contributed almost 24% of Thailand’s annual export revenues, generating US$55 billion. Major export destinations were ASEAN (17%), the EU (14%), China (14%), the US (13%), Hong Kong (12%) and Japan (11%). Thailand’s robust manufacturing base and well-developed infrastructure, including an efficient road and ports system, make Thailand an ideal place for electrical and electronics operations. Currently, almost all of the major electrical appliance manufacturers are represented in Thailand. The Kingdom is not only a regional leader, but also a leader on a global level as Japanese, Korean, European and American multi-national companies manufacture electrical appliances in Thailand. In 2011, Thailand’s main electronics exports were hard disk drives (HDD) and integrated circuits (IC), which accounted for approximately 34% and 26% of total electronics exports respectively87. The country holds a
remarkable reputation in the IC and semiconductor industries, and boasts one of the largest assembly bases for these products in South-East Asia. Considering the increase in global demand for hi-tech consumer electronics, including computers, flat panel displays, tablets, gaming consoles and wireless devices, Thailand is the ultimate investment destination for the sector. Electronics investors are able to benefit from the strong growth in demand, as well as the comprehensive support from the government of this global hub, in the electronics world. Parallel to the rocketing demand for computers and mobile phones, the total value of Thailand’s exported electronics amounted to approximately US$31 billion in 2011. The primary markets for these exports were China (18%), Hong Kong (17%), ASEAN (16%), the EU (14%) and the US (14%). Thailand has proven itself to be an extremely attractive location for the assembly and testing of HDDs, ICs and electronic sub-components. Although the electronics market in Thailand is mature and well-developed, there remain areas with high market potential that manufacturers considering to expand their market can explore. Currently, over 400,000 people are employed in Thailand’s electrical and electronics sector88. They are a well-qualified but
extremely affordable workforce that attracts many investors. Advancing the competitiveness and technical capabilities of the workforce has always been a main focus of the government of Thailand to ensure an adequate supply of qualified personnel for the industry. The Free Trade Agreements (FTA) between Thailand and various countries, such as Australia, New Zealand,
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India, Japan and members of ASEAN, gives Thailand and its foreign investors, a considerable advantage in reaching out to the different markets in the vibrant electronics industry. Under the ASEAN Free Trade Agreements (AFTA), most parts and finished electronics exported throughout ASEAN have been tariff-free since 2010. The establishment of the ASEAN Economic Community (AEC) in 2015 further enhanced Thailand’s attractiveness. The AEC serves as a massive single market that is fully integrated into the global economy with equitable economic development. The 10 member states of ASEAN collectively offer close to 600 million consumers. The AEC open new doors to manufacturers by transforming ASEAN into a region with free movement of goods, capital, services, investment and workforce. Thailand boasts world-class infrastructure, including state-of-the-art ports, airports and communication facilities. The government of Thailand has been proactively encouraging the development of electronic clusters. Proximity between firms and their input suppliers within the clusters enhances communication and facilitates flow of goods. At the same time, clustering helps to reduce logistics costs through improved supply chain management89
High-value export agriculture is an important element in the transformation of Latin America’s economic growth strategy from import-substitution industrialization to competing in a global economy. This type of agricultural production shares with hi-tech industrial production a focus on innovation, skilled labor intensity and local conditions that favor price competitiveness. High-value agricultural exports not only require a relatively high level of skills in producing the raw output but also require skills in bringing these products to market quickly and in such a way that maintains high quality. With new information technology, it is possible for Latin American countries to become major players in distant markets. But this requires the capacity to take advantage of such opportunities. The success of asparagus cultivation (spring vegetable) in Peru is a good example to adopt in developing the hi-tech Agricultural sector. Peru is one of the world’s fastest-growing economies with a 2012 GDP growth rate of 6.3%
. Manufacturers also benefit from shared core technological innovations and human resource development programs. Thailand’s electronics industry is the backbone of Thai manufacturing sector’s success.