In 2019, ETDA will appoint a new CEO and take new responsibilities as a regulator under the new Electronic Transactions Act.

ETDA will function as the secretariat of the Electronic Transactions Committee to prepare the Electronic Transaction Strategic Plan and the Infrastructure Standards Development Plan, regulate business related to electronic transactions, and analyse and certify a variety of standards.

“When considering the roles of government authorities and the scope of the current digital economy-related laws, the most urgent challenge for Thailand to transform to a digital economy and digital government is the removal of overlapping responsibilities among different authorities. It is evident that laws governing a number of government authorities overlap,” said Surangkana.

“According to the Electronic Transactions Act, which passed the National Legislative Assembly in January, ETDA is to determine the standards supporting electronic transactions as digital identification and see to their appropriate regulation. In setting standards, ETDA might become entangled with other organisations supervising open government and data sharing, including public information disclosure.

“ETDA will focus on providing recommendations and standards in the context of promotion, while maintaining a secure environment for data protection and security as defined by other laws,” she said.

The need to raise the qualifications of service providers and improve coordination among the technical systems of each service provider is considered critical information infrastructure which can affect confidence and trust in electronic transactions.

“ETDA, as a digital transformation facilitator, will be the organisation which supports the use of innovation for electronic transactions in management and services by the public and private sectors. ETDA will explore digital technologies, devise necessary recommendations as well as develop prototypes and sandboxes so that the public and private organization management and service provisions remain effective, efficient, secure, reliable, appropriate, and convenient to users in the ecosystem,” she added.

Surangkana said that ETDA intends to enhance digital-technology competence among Thai policy-level executives from the public and private sectors so that they can stay abreast of continual technology transformation and disruption.

 Arin Jira, chair of the Asean Business Advisory Council (Asean-BAC), commended the government for setting a progressive agenda for the Asean region. He particularly singled out its emphasis on improving the region’s industry 4.0.

Up to five of the 12 economic deliverables target the advancement of the region’s digital economy, notably, the Asean digital integration framework action plan, the Asean innovation road map and the Asean declaration on industrial transformation to industry 4.0.

“However, these are long-term goals,” said Arin in an exclusive interview with The Nation. The signing of declarations, the creation of road maps and frameworks may not yield tangible benefits to the region’s private sector by the end of 2019, he explained.

Of the economic deliverables that are not declarations, road maps or frameworks, the completion of the Regional Comprehensive Economic Partnership (RCEP) stands in the spotlight, followed by the implementation of the Asean Single Window trade system for all bloc members.

Arin believes the Thai government is moving in the correct path towards using RCEP to further integrate the Asean region with other economic giants such as China, India and Japan.

“However, completing the RCEP by the end of this year is going to be difficult,” he said.

“The Thai government faces a challenging task in finishing the RCEP negotiations this year,” he added.

Meanwhile, Prinn Panitchapakdi, a member of the Stock Exchange of Thailand (SET)’s board of governors, said in a separate interview that through using its position as Asean Chair, Thailand can push for further integration within the Asean region and reduce the negative impacts of the US-China trade war.

However, he added, even if deliverables connected to enhancing the region’s economic integration were completed by the end of this year, the possible benefits would not be seen until 2020.

For example, if the Thai government managed to conclude the RCEP negotiation against all odds by the end of this year, the benefits to exporters in Thailand may not be seen until 2020 when the trade pact is likely to kick in. “The results of what the Thai government manages to achieve as Asean chair may only be visible in the next two to three years,” he said.

One economic deliverable to address the region’s financial market is the “road map for Asean sustainability in the capital market”.

However, when asked whether this economic deliverable would bring investments to Thailand’s capital market, or whether it would make it more convenient for Thais to invest in Asean markets, key individuals in Thailand’s financial sector were unsure of the tangible benefits.

Prinn noted that Thailand’s Asean chairmanship might improve the Kingdom’s image internationally. Through hosting various regional events this year, Thailand may attract foreign investors to the market. However, he also noted that Thailand’s Asean period as chair could be overshadowed by other factors impacting the financial markets, such as the US-China trade war, the slowing of the global economy and the upcoming election.

The bond market may also not see any impact from Thailand’s Asean chairmanship, said Ariya Tiranaprakij, senior executive vice president of the Thai Bond Market Association. “What investors should be concerned about is the strength of the Thai baht, the level of inflation and whether the Bank of Thailand will increase interest rates.”

Ronnarit Virachanang, head of Kasikornbank’s capital markets business division, said the Thai government should use the Asean chair to push for the development of the region’s digital economy. In particular, it should stress the importance of up-skilling and re-skilling the region’s workforce to cope with technological disruptions in the market.

However, he said, it is questionable whether the private sector will see any benefits in 2019 from Thailand’s year at the helm. He also agreed with Ariya that the Kingdom’s bond market is unlikely to be affected by Thailand’s leadership.

“The key factor that will bring foreign investors into the bond market is the strength of the baht, which we expect to appreciate in the first half of 2019,” he said.

The business leaders agreed that while Thailand’s year could contribute to further economic integration of the region for the long run, the tangible benefits to the private sector in 2019 would be marginal at best.

Fears are rising over slowing economic growth in Europe, the US and China. A slowdown could overshadow any potential supply disruption, due to two key factors – the impact that Washington’s decision to impose sanctions on Venezuelan oil might have on trade flows, and a potential US refusal over requests to extend waivers on Iranian oil.

But market participants have been largely unanimous on one theme.

While economic growth concerns may slow the speed of a recovery in oil prices, the fall in OPEC’s output to four-year lows – thanks to a late 2018 deal with non-OPEC countries – is likely to prevent a sharp slide in prices.

To sum up, while the price rises may be slow in the first quarter, the scope for a slide in prices may be limited.

S&P Global Platts Analytics expects dated Brent prices to hover around $60/barrel in Q1 2019.

However, that range will be still be well below the near four-year high prices of $86.74/barrel (Bt2,707) the market witnessed on October 3, 2018, before crashing more than 40 per cent to fall below $50/barrel in late December.

According to an S&P Global Platts survey, OPEC in January pumped the lowest volume since March 2015, with crude oil production sharply falling to 30.86 million barrels per day, down 970,000 b/d from December.

The month-on-month fall was the biggest since December 2016. The 11 OPEC members achieved 76 per cent of their required cuts in January, with their production falling 619,000 b/d from October, the benchmark month from which the quotas were determined, except for Kuwait, which is using November.

On the macroeconomic outlook front, S&P Global Ratings expects global GDP growth to slow in 2018, led by the United States. Chinese growth will moderate. Europe’s growth will remain relatively low and stable.

But it has added that slowing growth does not mean it’s the beginning of another global financial crisis.

Bank of England governor Mark Carney, however, warned recently that the UK faces a 25 per cent chance of recession this year and that the risk of a recession would be increased by a no-deal Brexit.

Implications for Asia

US sanctions on Venezuela’s state-owned PDVSA are expected to affect crude markets in Asia as the South American country could be forced to redirect nearly half of its exports away from the US, its single largest customer.

PDVSA’s Asian customers, such as private Indian refiners Reliance and Nayara Energy, and Chinese independents, are expected to show interest for around 500,000 b/d of Venezuelan heavy crudes, to replace Iranian grades.

The sanctions could also boost competition for heavy crudes from the Middle East, such as Iraq’s Basrah Heavy, Bahrain’s Banoco Arab Medium and Saudi Arab Heavy. However, if Middle Eastern producers choose to trim their allotments to Asia and boost supply to the US, the market will tighten.

It won’t be easy for PDVSA to redirect all its displaced volumes to Asia, where oil refineries are configured to process mostly medium sour grades from the Middle East. In addition, only a few refineries actively seek heavy grades on the spot market.

PDVSA’s crude exports were around 1.28 million b/d in Q4 2018, with the US taking in more than 40 per cent of those exports, India nearly 20 per cent and China about 22 per cent. While the sanctions have yet to affect global oil prices significantly, that could change if the crisis in Venezuela drags on.

Another big question hanging over the market is whether the US will agree to a second round of waivers for importing nations to continue buying Iranian oil.

A US special representative for Iran said recently that Iran’s oil customers should not expect new waivers to the US sanctions in May.

Many market participants, however, still expect the US to grant fresh waivers when the current exemptions expire in May. Oil prices will largely determine the extent of those waivers.

Iranian crude imports by South Korea, Japan and India have been slashed at least by half from levels before November, when the US re-imposed sanctions on Iran’s oil trade, according to S&P Global Platts calculations.

Platts Analytics expects Iran’s oil exports to average 1.2 million b/d over January-April and fall to 860,000 b/d by Q4 2019, compared with about 2.7 million b/d in early 2018.

Markets will be also be closely watching another development in February.

Expectations are also growing that OPEC, after failing to close a deal last year, will try again this month to iron out a permanent pact with Russia and nine other key non-OPEC allies to manage the oil market and stabilise prices.

OPEC members will confer today to finalise a draft charter and then present it to the non-OPEC partners on February 22. The goal is to ratify the charter at the next full meeting of the coalition of OPEC and non-OPEC members over April 17-18 in Vienna.

Although, the intensifying political crisis in Venezuela may complicate the plans, markets will be closely watching developments to get some signals on the direction for oil prices.

Contributed by SAMBIT MOHANTY, senior editor, Asia Oil News & Analysis, S&P Global Platts.

We now see robots working alongside people to build cars and deliver packages. Blockchain is used for tracking supplies of diamonds and monitoring construction equipment. In addition, smart machines are taking up residence in hospitals, shipping containers, drug stores and much more.

Similarly, digital technologies are disrupting the way the finance sector goes about its business, offering the promise of better, faster and probably less-expensive transactions.

We can reimagine a future in which we’ve combined different technologies. How would the work of finance get done and who would do it? How could finance contribute more to the success of a company? From Deloitte’s perspective, here are the eight trends we could imagine:

1. Finance factory: Transactions will be touchless, as automation and blockchain reach deeper into finance operations. The human resources required to perform work in this area will dramatically decrease.

2. The role of finance: When operations are largely automated, the finance department’s human resources will double down on business insights, analysis and advisories. That said, the skills expected of a finance professional will change dramatically. Leaders might consider identifying their finance business partner and cloning them.

3. Finance cycles: The finance transaction processing will go real-time. No need to wait for a period end and then generate a business performance report. The limitations of computing power will disappear in the digital world. Figures and reports required for business decisions will be available on demand, with traditional cycles becoming less relevant. Leading companies will shift to a new mantra – there is no period close. Monthly or quarterly forecasts would no longer exist, as processes are all happening in real time.

4. Self-service: It will become the norm, the preference of finance customers in a digital world. Finance customers will no longer need handholding, but instead prefer to get their questions answered by a digital voice or mobile application. Finance staff’s activities will be replaced by visually rich information that is intuitively accessible and easy to use. With the growing expectations for responsiveness and quality, finance professionals need to now observe what makes a self-service tool they use in their own lives effective – and transfer that model to finance services.

5. Operating model: New service-delivery models will emerge as robots join a more diverse finance workforce. Finance professionals will be an integrated mix of employees, freelancers, gig workers and crowds. The company will assess the benefits of automation against onshore and offshore operations. Automation provides a new lever to manage costs, which gives the finance organisation an opportunity to re-evaluate the way they are organised and operate.

6. Enterprise Resource Planning (ERP): The ERP package will come in the form of a building in of digital technologies such blockchain and cognitive tools. Cloud-based ERP will be a new norm that shortens the ERP lifecycle and also ensures that the application is constantly updated. Finance needs to team up with IT professionals to create a roadmap toward cloud computing.

7 Data: The proliferation of Application Program Interface will drive data standardisation. But the quality of data is the key to making it possible. Many companies still struggle to align and standardise data, which results in them failing to capture the full value of digital transformation. Therefore, there is a need to now identify and prioritise area in which data quality needs to be improved. Start from the area that can make the greatest impact and you will have more energy to do the rest

8 Workforce and workplace: Finance professional will do new things in new ways. Finance talent modes are evolving quickly, with a premium placed on data scientists, business analysts and storytellers. This represents a dramatic shift for the skills required to become a talented finance professional in the future. To prepare, choose new hires with different skill sets, including strong customer-orientation, flexibility and good collaboration skills, as well as the technical capabilities required to perform specific jobs.

Future finance professionals will be more technology savvy. The key performance indicators for evaluating performance of finance professionals need to shift too. The workplace will evolve to embrace more self-service and tools that keep people well connected will be critical. However, the future will still require physical proximity for teams, especially at the project start-up and planning stages.

None of us knows for certain what the future will hold, so the best way to predict the future is to create it.

MARISA AUNHAVICHAI, is a partner in consulting services and the CFO services leader, Deloitte Thailand.

The forecast range for this year’s GDP growth stands between 3.5 to 4.5 per cent, with a mean of 4 per cent, said the government advisory body.

The economy grew by 3.7 per cent in the fourth quarter of 2018, increasing from 3.2 per cent in the third quarter. Overall, 2018 GDP growth stood at 4.1 per cent.

The positive factors pushing this year’s economic growth include private and public investments, the road to the upcoming election and private consumption, the body’s secretary-general, Thosaporn Sirisumphand, said yesterday during a press conference.

Meanwhile, the risk factors for the economy include the ongoing US-China trade war and Thailand’s post-election political situation, he said.

Private investment is forecast to grow by 4.7 per cent in 2019, up from last year’s 3.9 per cent-growth year on year.

“The increase in Thailand’s private investment comes largely from investments in the manufacturing sector, which has seen accelerating growth in the past four quarters,” explained Wichayayuth Boonchit, the NESDC deputy secretary-general.

Investment in machinery and equipment grew by 5.6 per cent in the fourth quarter, increasing from 3.4 per cent in the third quarter.

Public investment is also expected to increase significantly, growing by 6.2 per cent in 2019 compared to last year’s 3.3 per cent growth.

However, public investment saw a contraction of 0.1 per cent in the fourth quarter of last year.

“This is due to the decrease in government investment. Meanwhile, investment from state enterprises increased by up to 8 per cent,” Thosaporn claimed.

“For this reason, the fall in public investment in the fourth quarter will not affect the developing infrastructure projects,” he assured.

The road to the upcoming general election will also have a positive impact on the economy in the first two quarters. In total, between Bt20 million and Bt30 million will be spent on election campaigns by political parties, according to Wichayayuth. This will contribute between 0.1 to 0.2 per cent to the GDP growth.

“Private consumption is forecast to continue to grow steadily in 2019,” Wichayayuth continued. “This is because of recovering tourism figures as well as a fall in the unemployment rate.” “We expect 40 million tourists to visit Thailand in 2019, increasing from 38 million in 2018, which will, in turn, boost private spending,” Thosaporn added.

The level of unemployment has also contracted. In the fourth quarter of last year, the unemployment rate decreased from 1 per cent in the third quarter to 0.9 per cent.

When it comes to the risk factors, the trade war presents the highest level of uncertainty for the Thai economy. Wichayayuth said that if the dispute escalates further, it may damage Thai exports and the NESDC may have to adjust their economic forecasts for this year.

“The US is not only concerned about reducing its trade deficit with China. It is also making demands for China to restructure its economy and is concerned about China’s technological advancement,” he explained. “Thus, the trade conflict between the US and China may not be settled easily.”

Thai export growth has seen a decline throughout the latter half of 2018, growing by only 2.3 per cent in the fourth quarter despite a 7.7 per cent growth over the entire year. Exports are predicted to grow at the modest rate of 4.1 per cent in 2019.

“The political situation in Thailand also presents a risk factor to the economy,” said Wichayayuth, referring to the possibility of a post-election political instability.

He said the key concern for the economy was whether the new government would be able to agree on the 2020 national budget. If the budget is not finalised by October 1 this year, government spending and investment in the fourth quarter of 2019 may decrease, he said, adding that this would drag down the country’s economic growth in that quarter.

“The post-election political uncertainty may also lead to the delay of public infrastructure projects that are already in the pipeline,” he cautioned.