Thailand and Its Knowledge Economy

1
Thailand and Its Knowledge Economy

• Arkhom Termpittayapaisith
• Deputy Secretary-General, Office of the National
  Economic and Social Development Board, Thailand.

2
Development Paradigm
Old Paradigm
Low Labor CostAbundant Natural Resources
Unsustainable Dev.
New Paradigm
Knowledge Labor NR
SustainableDev.
3
Knowledge Economy Where Does Thailand Stand?

• 1.Economic competitiveness technological and
  scientific capabilities
  
• - WEF Ranking
• - IMD Ranking
• 2. Knowledge economy Knowledge Assessment
  Methodology (KAM)

4
World Economic Forum (WEF) Technology and
Innovation Indicators
Innovation Index
Technology Readiness index
Technology Transfer
Japan 5 2 -
Korea 8 16 -
Singapore 13 7 -
Malaysia 40 15 1
Thailand 43 39 5
China 75 68 43
Source WEF 2005 and 2006
5
IMD Science and Technology Assessment
06 48 53 61
04 45 55 60
03 20 26 30
02 43 46 49
01 48 49 49
00 47 47 47
99 47 48 47
98 43 43 47
97 32 32 47
05 45 56 60
Infrastructure
Technological Infrastructure
Scientific Infrastructure
Numbers of Countries Assessed
Source IMD, various years.
6
Knowledge Assessment Methodology (KAM)

• KAM is based on the four of pillars of KE
  developed by the World Bank Institute (WBI) that
  are
  
• (1) economic and institutional regime,
• (2) educated and skilled population,
• (3) national innovation system, and
• (4) dynamic information infrastructure.
• KAM is designed to help countries assessing their
  strengths and weaknesses in making transition to
  knowledge economy.

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Thailands KEI increasing from 4.26in 1995 to
4.78 in 2002
Source Dahlman (2003)
8
Selected 14 Variables from KAM(Detailed Analysis)
Overall Performance of the Economy
? GDP Growth ? Poverty Index
Economic Incentive Institutional Regime
? Soundness of Banks ? Intensity of Local Compet
ition
? Government Effectiveness
Innovation System

• Researchers in RD Per Million Population
• ? Total Expenditure for RD as of GDP
• ? Research Collaboration (UILs)

Education Human Resources
? Average Years of Schooling ? Professional Tec
hnical Workers ( of Labor Force)
? Quality of Science Math Education
ICT
? Internet Users Per 10,000 People
? E-Govt services
? ICT Expenditure as of GDP
9
KAM Spidergram for Thailand, Japan, Korea and
China
Source The World Bank Institute (2006)
10
Thailand, KAM Spidergram for Selected Variables
of Innovation Pillar
Source The World Bank Institute (2006)
11
Selected Indicators Measures of Innovation

• Educational Attainment of Thai Population and
  Workforce
  
• Quality of the Educational Outputs
• RD Expenditure and Patents

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Educational Attainment
Country
Mean Years of School
No Schooling( of pop. aged over 15)
Thailand 6.5 12.6
Korea 10.84 6.5
Malaysia 6.8 16.2
Singapore 7.05 16.4
Taiwan 8.76 10
Source Barro and Lee (2000) and
http//www.ksg.harvard.edu/CID
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Educational Attainment of Population Thailand
and Malaysia
Malaysia 2000
Thailand 2000
Source Dahlman (2003).
14
Thai labor force is not well educated

• Educational Attainment of Employed Persons Aged
  Over 15

Source National Statistical Office (2005),
Report of the Labor Force Survey.
15
Workforce Employed in Thai Business Enterprises
is mostly Non ST Classification.

• Percentage of ST and Non ST Workforce
  Classified by Industry

Source Thailand Research and Development
Institute (2004).
16
Quality of the Educational Outputs
1995
1999
Country Singapore South Korea Taiwan Hong Ko
ng Japan Malaysia Thailand Indonesia Philippi
nes
Math 604.4 587.2 585.1 582.1 578.6 519.3
467.4 403.1 344.9
Science 567.9 548.6 569.1 529.6 549.7 492.
4
482.3 435.5 345.2
Science 580.4 545. 8 509.7 554.5 510.1

Math 608.6 580.7 568.9 581.1 516.2

• Thai secondary education students performed below
  average and poorly as compared with students in
  other East Asian countries.

Source Trend in Mathematic and Science Study
(TIMSS), as cited in the World Bank (2005).
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Program for International Student Assessment
(PISA) Score
2003 Japan Korea Hong Kong Indonesia Maca
o-China
Thailand OECD Average
Math 553 552 558 361 528 424 496
Science 548 538 539 395 525 429 500
Reading 598 534 510 382 498 420 494

• Thai students under the supervision of IPST were
  reported their great performance in Olympiad
  programme

Source Program for International Student
Assessment (PISA), (OECD) as cited in the World
Bank (2005).
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RD Expenditure
(Million Bath)
RD exp. RD exp. per capita (bath) RD ex
p. as of GDP
Govt. budget outlays for RD
1996 5,528.1 92.0 0.1 3,395.2
1999 5,021.7 81.3 0.12 2,182
.7

2003 15,499.2 242.2 0.3 7,36460

• Thailand requires more national RD spending
• RD spending, a more focus on research/knowledge
  commercialization through increased patenting and
  a more entrepreneurial dimension has to be in
  place

Source RD Survey, NSO.
19

• RD Expenditure classified by Field of Research
  and Sector of Performance

• Business enterprises and higher education are key
  players in research and development

Source RD Survey, NSO.
20
Patents per 100,000 Populations
Change 1993-96-2001-04
2001-04
1993-96
1985-88
East Asia Pacific Taiwan, China Singapore
Hong Kong Korea Malaysia Thailand China
Philippines Indonesia OECD United States
Japan Australia
0.04 1.81 0.31 1.67 0.20 0.02 0.00 0.00 0.
01
0.00 9.83 18.47 12.62 2.80
0.20 9.24 1.86 3.65 2.59 0.08 0.02 0.00 0.
01
0.00 12.83 24.50 18.75 2.99
0.66 30.17 9.87 9.32 8.67 0.28 0.07 0.03 0
.02
0.01 19.00 33.56 28.54 5.26
225.6 226.6 431.7 154.9 235.4 238.6 276.0 6
36.0
377.2 132.4 48.1 37.05 2.27 6.3
Source US Patent and Trademark Office as cited
in the World Bank (2006), East Asia Update.
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Government Policy in Enhancing Knowledge Economy

• Development goals for ST development in the 9th
  National Economic and Social Development Plan

• qualitative goals
• Enhancing capability in technological
  innovation
  
• Setting up mechanisms and institutions for
  knowledge diffusion and knowledge transfer
  
• Focusing on quality improvement for teaching in
  all ST educational levels.

• quantitative goals
• Increasing RD expenditure to be not less than
  0.4 of GDP
  
• Increasing numbers of researchers to 3.5
  persons per 10,000 populations.
  

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Policy Implementations
Institutional arrangements in Thailand in
relation to innovativeness and knowledge

• ? The National Science and Technology Development
  Agency (NSTDA)
  
• ? Office of Knowledge Management and Development
  (OKMD) administers 7 offices
  
• 1.Thailand Design Center, TDC
• 2.Thailand Center of Excellence for Life
  Science
  
• 3. National Center for the Gifted and Talented
• 4. Thai Knowledge Park
• 5. National Discovery Museum Institute
• 6. Center for the Promotion of National
  Strength on Moral Ethics and Values
  
• 7. National Institute for Brain-based Learning
• ? National Innovation Agency
• ? Science Park
• ? Software Park
• ? Software Industry Promotion Agency (SIPA).

• Role stimulating technology development and
  providing incentive structure for a society of
  knowledge and innovativeness of the country.

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University and Industry Linkages (UILs)in
Thailand

• Prominent role of the university is put onto
  educating people while other roles are still at
  minimum.
  
• Firms have generally not exhibited strong
  interest in UILs
  
• Effective UILs are heavily tied with large firms
  such as large garment exporters, Seagate in hard
  disk drives, and the CP group in shrimps

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Thai firms and their major partners
?Clients, parent/associate companies, local and
foreign suppliers are major partners of Thai
firm ? RD institutes and universities including
government have played a minor role in building
technology/innovation capabilities of firms.
Source Based on Thailand National Science
Technology Development Agency RD/Innovation
Survey 2002, cited in Intarakumnerd (2005).
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Brief review of UILs in Thailand

• Mitr Phol sugarcane research center has linkages
  with public technology institutions like National
  Science and Technology Development Agency, and
  MTEC more than those with university.
• Toyota Technical CenterAsia Pacific (TTCAP) has
  had significant linkages and collaboration
  extending beyond the national boundary where the
  center is located. However, TTCAP is reported to
  have a simple network to recruit employees with
  Thai universities.
• Seagate Qualified engineers are produced in
  collaboration with Thai universities and the
  first joint Seagate/AIT academic course has been
  offered in the Master's program since 1999.

Sources Brimble (2006), Asian Institute of
Technology(2006).
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NSTDA Major actor in national innovation system

• The National Center for Genetic Engineering and
  Biotechnology (BIOTEC) has led the research in
  modern biotechnology that helped prevent
  disastrous losses in shrimp production,
• The Cassava and Starch Technology Unit induces
  research and development for improvement in Thai
  cassava and starch, e.g. industrial application
  of cassava and starch in both food and non-food
  industriesprocess for the production of ethanol
  and renewable fuel (BIOTEC, 2006). ,
• Set up the Software Park Thailand (SPT) one
  successful example that received strong support
  from well-known transnational corporations (such
  as IBM, HP, SUN, and ORACLE) and established
  collaboration with Canegie-Mellon university for
  offering training and certification on the
  Capability Maturity Model to raise the standard
  of software production of STPs tenant companies
  (Virasa, 2005, p. 104)

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National Competitiveness Committee (NCC)

• NESDB under NCC has set up action plans for human
  resource development in major industries

Petrochemical-industry group under the Thai
Industry Federation, Petroleum Institute of
Thailand, the Office of Vocational Education
Commission and the NESDB have signed MOU for
implementation of a pilot project on human
resource development in petrochemical industry
The Constructionism-Chemical Engineering Practice
School (C-ChEPS) was designed for improving
skills of workers in petrochemical industry.
Training programmes under C-ChEPS was initiated
in 2000 by a private corporation, the Siam Cement
Group under a collaboration with the King
Mongkuts University of Technology Thonburi.
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Some Policy RecommendationsGiven the framework
of knowledge economy, Thailands innovation and
education systems have confirmed the weakest
arena among others.

• Strengthening education system (i.e. education
  reform) and outputs to increase qualified
  workforce particularly in ST skills, including
  putting in place incentives for firms in the-job
  training system
• Building new knowledge through basic research,
  RD spending, technology transfer including
  developing strong linkages in universities,
  research institutes and firms (i.e.
  university-industry linkages) as foundation for
  knowledge generation and technology catching-up
• Ensuring sufficient incentives for firms to
  innovate in new products and processes for
  industry and services sectors, given new trend in
  technology and market demand
• Establishing ST infrastructure (e.g. science
  parks, research funding, IT infrastructure etc.)
  and increasing private involvement in developing
  the knowledge economy.

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