Chairing a meeting with the executive directors of Thai trade centres overseas and the private sector yesterday, Somkid said the Ministry of Commerce has estimated an 8 per cent growth in next year’s exports with US$276 billion in total value, He asked all parties to deepen cooperation in push for Thai export expansion amid the US-China tensions and the global economic uncertainties.

As trade opportunities for Thailand exist in both China and the United States, Somkid asked Thai trade centres to plan ahead with studies and list products with export potential to 11 provinces in China.

In the meantime, the Board of Trade of Thailand has also been asked for a clustering of 10 Thai private corporates for the purpose of acquiring retail businesses or outlets for distribution of Thai products in the United States.

In Asean, Thailand needs to leverage the cooperation of CLMVT (Cambodia, Laos, Myanmar, Vietnam and Thailand) for a link up with China and Japan, while the country need to become a member of Trans-Pacific Partnership (TPP).

Somkid has also told all Thai trade centres to ask for additional workforce and funding if needed, while encouraging them to use e-commerce to penetrate overseas markets.

Currency volatility, appreciation of the Thai baht and higher global crude prices will likely occur next year, he warned.

Commerce Minister Sontirat said this year’s export is expected to expand as targeted at 8 per cent and next year’s estimated growth figure will also be 8 per cent.

The trade war coud have a positive impact on Thailand if the country can devise a strategy to boost the exports of products affected by the trade war.

Thailand plans to attract two product groups, electronics and textile which could not be exported from China to the US, to relocate their manufacturing bases to Thailand, he said.

Released yesterday, the Outlook forecasts up to 7,700 new business jet deliveries worth $251 billion (Bt8.15 trillion) from 2019 to 2028, up 1 to 2 percentage points from the 2017 10-year forecast.

“A better used-aircraft market environment coupled with the entry into service of many new business jet platforms will lead to higher deliveries in 2019 after a virtually flat year in 2018,” said Bill Kircos, vice president, global marketing, Honeywell Aerospace.

“We are excited about the used market and about |new and innovative aircraft models that will not only drive solid growth in 2019 and 2020, but also have a significant impact on new business jet purchases in the midterm and long term.”

 2017 was an exceptional year. Despite growing political tensions, it was an almost perfect year for investors. The economic recovery following the financial crisis culminated in a synchronous upturn around the globe and financial markets performed strongly, particularly equity markets. As a result, financial assets of households rose significantly by 7.7 per cent. Global gross financial assets increased to EUR 168 trillion.

Thailand: Financial assets growth slowed down

In 2017, financial assets of Thailand’s households increased by 6.2 per cent, slowing down from 9.8 per cent in the previous year. The main “culprit” was securities which clocked growth of “only” 9.8 per cent, after a bumper year 2016 with an increase of more than 20 per cent. Other asset classes performed more or less in line with the year before: bank deposits increased by 4% and insurance and pensions assets by 3.8 per cent. Bank deposits remained the dominating asset class in Thailand’s private households’ portfolio, amounting to 45% of their total financial assets followed by securities, stocks and bonds with a share of 39.3 per cent.

The indebtedness of Thailand’s private households remains a pressing topic. Despite a slight easing in 2017, private liabilities amounted still to a whopping 79.1 per cent of GDP, coming down from a peak 81.2 per cent in 2015. But this development did not reflect debt restraint, on the contrary: the increase in liabilities picked up last year again, reaching 4.6 per cent after 3.8 per cent in 2016; it was solely due to the fact that (nominal) economic growth outpaced loan growth. Although the increase was markedly below the double-digit rates witnessed between 2010 and 2013, especially households in the lower income deciles remain vulnerable. Rising interest and unemployment rates could easily lead to a growing number of households running into difficulties to pay back their loans.

Net financial assets increased by around 8 per cent, reaching EUR 4,330 per capita. Thus Thailand came in 44th in the list of the richest countries (financial assets per capita, see table for the top 20) worldwide like in the previous year. At the top of the list, Switzerland re-captured the top spot that it lost the year before to the US. In general, European countries did in 2017 better than in previous years; this, however, reflects first and foremost a stronger euro.

Industrialised nations catch up: the US overtakes China

The years following the crisis were mainly characterised by relatively weak asset growth in industrialised compared to emerging countries. This also changed in 2017. The acceleration in growth was due solely to development in industrialised nations: while growth in these countries increased by more than one percentage point to 6.5 per cent, in emerging countries it slackened by three percentage points to 12.9 per cent. The growth differential between these two groups of countries was thus at its lowest level since 2005, at 6.5 percentage points. The average figure for the past decade was twice as high, at 13 percentage points.

This contrasting development when it comes to growth in financial assets was largely due to the respective heavyweights, China (where growth slowed from 18.3 per cent to 14 per cent) and the US (where growth accelerated from 5.8 per cent to 8.5 per cent). In Asia (ex Japan) growth eased from 14.7 per cent in 2016 to 12.2 per cent in 2017. The US has thus overtaken China again in terms of absolute growth. In 2017, the US accounted for around 44 per cent of global growth in gross financial assets of households, while China accounted for only about 25 per cent. This ratio has averaged 26 per cent vs. 35 per cent over the last three years – but with China coming out on top.

More participation thanks to globalisation

The last two decades of rapid globalisation have given rise to a new global wealth middle class, which included almost 1.1 billion people at the end of 2017.

Fewer than half a billion people belonged to this group at the turn of the millennium, with just under half of them coming from Western Europe, North America or Japan. Today, these countries account for only a quarter of the global wealth middle class. In contrast, China’s share has soared from just under 30 per cent to over 50 per cent in this period. The figures accompanying this success story are impressive: around 500 million Chinese people have moved up to join the ranks of the global wealth middle class since 2000, and over 100 million more can now even consider themselves part of the global wealth upper class. Thus today 62 per cent of the global middle wealth class and 42 per cent of the high wealth class are citizens of an Asian country.

Contributed by MICHAEL HEISE, chief economist of Allianz

The NBTC’s executive director of its spectrum management bureau, Saneh Saiwong, said yesterday that among the spectra the NBTC will deploy to test the 5G technology are those in the range of 3.5GHz and 24GHz.

They are the spectra for which there is compatible equipment. The trials will focus on whether their use will interfere with the signals for other spectra as well as help to determine the potential applications of 5G services in Thailand.

The NBTC has set up a working panel on 5G development. The regulator has yet to finalise which spectrum bands it will assign for the future offerings of 5G services, as this calculation is subject to many factors.

The services under the incoming 5G network are envisaged as capable of being put to many to many uses, especially in the industrial sector.

NBTC secretary general Takorn Tantasith said yesterday that while 5G would definitely get off the ground in Thailand in the next few years, the government should also be prepared to step in with measures to help those employees who could lose jobs owing to the resulting technological disruption.

Takorn cited the potential impact on those in the manufacturing and financial and banking sectors. The government should seek ways to help retrain such workers for other jobs during the takeoff stage of 5G in Thailand.

He said that it is the government, and not the private telecommunications operators, that would take the lead role in making 5G happen in Thailand.

NBTC deputy secretary general Korkij Danchaivichit said the price of the 5G spectra to go up for auction should not be unrealistically high, adding that the NBTC aims to conduct a multiple-band auction for the 5G spectra, or the auction of the combined lower- and high-spectrum bands in the same packages.

 The country improved its score from 66.3 in 2017 to 67.5 out of 100 in the report that is put out by the World Economic Forum (WEF), according to the Faculty of Commerce and Accountancy at Chulalongkorn University. The faculty is an official partner of WEF.

The report, released yesterday, covered 140 countries and territories. The result has been taken to show that Thailand is steadily moving towards to the objectives of the 4.0 economy.

The WEF changed the criteria and methods of calculating the GCI rankings in order to reflect the so-called fourth industrial revolution.

Under the study, the 10 most competitive economies were listed as the United States, Singapore, Germany, Switzerland, Japan, the Netherlands, Hong Kong, the United Kingdom, Sweden, and Denmark. Associate Professor Dr Pasu Decharin, dean of the Faculty of Commerce and Accountancy, said the faculty had been responsible for collecting in-depth information from a questionnaire answered by top executives in large and small organisations across all industrial sectors. According to the criteria of WEF, the global competitiveness of a country or territory was calculated from 98 indices categorised into 12 pillars to reflect its overall competitiveness.

Regarding the new criteria and methods of calculating GCI, which were designed to reflect the fourth industrial evolution, Thailand moved up two places from 40th position last year.

For comparisons with the previous year, WEF also employed the new criteria and methods of GCI 4.0 to analyse the data of 2017. Under this framework, Thailand was awarded the score of 66.3 in 2017. The results confirmed that, with the new criteria and methods of calculating GCI 4.0, the country is increasingly advancing towards the goals of the Thailand 4.0 era.

Of note is that, when Thailand is compared with other countries, its main pillar was the financial system.

This was ranked 14th worldwide with a score 84.19 out of 100. The important indicators in this pillar consisted of capital availability, credit services, a variety of financial products and financial risk diversification system, including domestic credit to private sector, financing of small and medium-sized enterprises, financial support to start-ups and the soundness of the country’s banks.

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Moreover, the market size pillar of Thailand achieved an impressive ranking of 18th with a score of 74.88, due to the market accessibility of domestic and foreign companies in Thailand. This reflected the combined results of domestic consumption, investment and exports.

Regarding Thailand’s further development and improvement to accomplish the goals of the fourth industrial revolution, its product market pillar was ranked 92nd with a score of 53.4. The study cited the domestic competition, market dominance, business openness and complex regulations.

Free competition and uncomplicated regulations have led to the higher degree of innovation in this respect. Further, Thailand’s education and skills pillar was ranked 66th with 62.99.

In comparison with the countries in Asean+3 (excluding Myanmar), Thailand was ranked sixth out of the 12 countries, after Singapore, Japan, South Korea, Malaysia, and China. The rank obtained was the same as the previous year regardless of the changes in methods and criteria. This reflects the potential of Thailand in terms of its sustainable competitive status in Asean+3.

The survey on the global competitiveness among countries under the GCI 4.0 is taken by policymakers as a significant measurement. In addition to assigning rankings of the global competitiveness among nations, the GCI highlights advantages and addressed issues in order to promote sustainable development in the future. In Thailand, the Faculty of Commerce and Accountancy at Chulalongkorn University is in partnership with GCI to develop and distribute such information.

Some academic researchers have found a positive correlation between the degree of competitiveness and gross national income per capita in each country. In 2018, all countries and territories in the top 20 of GCI 4.0 have high gross national income per capita. For those countries and territories in the top 40 of GCI 4.0, only Malaysia (ranked 25th), China (28th), and Thailand (38th) do not have high gross national income per capita.

The 12 pillars used in the rankings are institutions, infrastructure, ICT adoption, macroeconomic stability, health, education and skills, product market, labour market, financial system, market size, business dynamism and innovation capacity, Pasu said.