Thailand's competitiveness ranking shows weaknesses in labour productivity and human resource development and also in health and the environment, says the Switzerland-based Institute for Management Development (IMD).
Thailand came 26th out of 57 economies in the institute's 2008 survey. In the survey's four main categories there were improvements in economic performance, up from 14th to 12th place, and government efficiency, up from 22nd to 17th. Business efficiency was stable at 25th while infrastructure dropped to 42nd from 39th. The rankings, which was released in June, were based on data and a survey of executives in 2008.
Thailand's competitiveness improved markedly from 2007, when it fell to 33rd place, and was up one place from 2005. The country achieved its highest rank - 23rd out of 41 countries - in 1994, when it was placed above South Korea and Spain, said Suzanne Rosselet, IMD's deputy director.
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"Thailand's ranking has been quite stable between 1994 and 2009. It has so far been quite where it was. There is great potential to move competitiveness up," she said at a conference in Bangkok yesterday.
Among 29 countries with income per capita less than $20,000, Thailand ranked fifth, behind Malaysia (first), China (second) and Chile (fourth).
Between 2005 and 2009, Thailand has had a strong economic performance with its ranking up to 7th from 14th. government efficiency has climbed to 14th from 17th place while business efficiency has stayed at 25th. Concern over foreign exchange volatility, investor confidence and political stability depressed the country's rankings in 2007.
Thailand's low ranking in infrastructure slipped from 39th in 2005 to 42th place in 2008, pointing to the need for improvement, she said.
Korea, which ranked 20th in infrastructure, was ranked one place below Thailand overall because it lags in its economy, government and business efficiency. Thailand was given ninth place in the Asia-Pacific region, where Hong Kong led the pack.
Thailand ranked 46th for foreign direct investment and 50th in productivity and small and medium-sized enterprise performance. It was also 50th for expenditure on health, medical assistance and energy efficiency, said Ms Rosselet.
Prime minister Abhisit Vejjajiva said the government aimed to direct its fiscal stimulus spending planned until 2012 to improve the long-term competitiveness of the country.
"Although the country's competitiveness has improved during the last couple of years, we realise that there is need for a major overhaul to increase productivity for the return of investment," he said.
"The 800 billion baht worth of borrowing will be used in transport, education and health to boost the economy and productivity in the next few years. In the first six months, we aimed at protecting people [from the global recession] who are least fortunate."
The government will invest in water resource management for agriculture. Farm production has great potential as global demand for food and alternative energy will grow in the future, he said.
The country is strong in service areas such as tourism and medical care, but the improvement in productivity has been slow. The government plans to increase diversity and liberalisation in the service sector, said Abhisit.
http://www.bangkokpost.com/business/economics/19567/competitiveness-survey-finds-flaws
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