Vietnamese economy to overtake Thailand’s within 5 years

[TotallyOz]

Thailand’s competitive edge, currently ranked 11th worldwide, will drop to 15th place in the next five years and be overtaken by Vietnam, according to a industrial specialist.

 

Nuanjai Kittisriboonkul, manufacturing industry leader of Deloitte Southeast Asia, said Vietnam-- which now ranks 18th-- will jump to 10th place in five years.

 

Growth prospects for the Southeast Asian region are positive, with China commanding the first place among Asia economies, followed by India, she said, indicating that the phenomenon will compel the United States, Germany and Japan to seriously review their strategies.

 

Countries in Southeast Asia including Singapore, Thailand, Malaysia, Indonesia and Vietnam will surge up in unison to occupy the top 20 ranks worldwide, she said.

 

Ms Nuanjai added that Indonesia, currently ranking 17th, will move to 11th place in the next five years. China will retain its No. 1 rank in the next five years whereas India which now ranks fourth will become No. 2, she said.

 

For the entire story:

http://www.mcot.net/site/content?id=50bd783e150ba062530002d3#.UL2LxYV8VD0

[Guest fountainhall]

I don't think the prospect of Vietnam overtaking Thailand is all that surprising. Many statistics are almost identical for each country - e.g. life expectancy and literacy rates. But Vietnam has 24 1/2 million more people and the average GDP per capita is only $3,400 compared to Thailand's $9,500. Many more manufacturing jobs will flood to Vietnam from countries like China. Thailand has somehow to move up the chain and concentrate on higher value exports and more high-tech manufacturing if it is not to drop down the ladder.

[Bob]

Hold the phone. When I first read the title, I couldn't figure out how Thailand would rank 11th in the world at anything! (Well, other than beautiful people). So, I read the article and I'm still at an absolute loss. Anybody have any idea how they define "competitive edge?" Had the article said Thailand was 11th in Asian nations (or even Southeast Asian nations), I might have believed that. But I have no idea how Thailand ranks 11th in the world in any factor relating to economics, politics, free speech, or whatever.

 

Given I view Thailand's educational system as falling behind all Southeast Asian nations (excepting Burma and perhaps Cambodia), any ranking on any economic scale doesn't seem too promising for the long-term.

[Guest]

That's certainly not a GDP based study.

 

More likely, it's some kind of study that's looking at how cheaply things can be produced in the economy, considering things like labour costs, logistics costs etc. Considering the article doesn't explain the methodology, we cannot assess if the analysis has any merit whatsoever.

[ceejay]

Thailand has somehow to move up the chain and concentrate on higher value exports and more high-tech manufacturing if it is not to drop down the ladder.

 

That's already happened, with companies like Canon (Japan, cameras etc.) and Seagate (US, hard disc drives) having huge production facilities here. Jobs in low tech industires such as textiles have been moving to Vietnam for years.

If labour costs are heavily weighted into an index like this, then countries can move up in them by doing nothing. As GDP and standards of living rise in economically successful countries, labour costs do too.

The biggest threat to Thailand's future prosperity is their education system. High tech economies don't just need a few highly educated stars at the top. They need a well educated general workforce too.

[pong]

having just visted VNam last week-only the south, and now happily back in BKK- noone explained on which figures this was based. ON general income it cannot be possible-look at given facts, whcih very much corresponding to my own impression. VN is not dirt poor as Laos-but backward compared to even Indonesia. INfrastructure is ages behind, out of the big cities its the 3d world Asia that TH has left already far behind. MOstly resembles China IMHO.

FOund it strange that in big shops (BigC has just opened up there-and its an instant hit) at least half the food on display is made in TH. In fact lots of food cost more in VN as here in TH-plus that the wages there are lots lower. Some were very surpirsed and jumped to emigrate when I told them that the legal min. here is now 300 THB/day, or 10 US$. A MONTHLY of 3000bt=100US is already a princely sum there-teachers earn less.