Thailand: Creating New Growth Engines through Science, Technology and Innovation

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1 Thailand: Creating New Growth Engines through Science, Technology and Innovation Kitipong Promwong Secretary General National Science Technology and Innovation Policy Office (STI)

2 Seeking a New Economic Development Model for Thailand: Thailand 4.0 Source: Suwit Maesinsee,

3 Creating New Engines of Growth Source: Suwit Maesinsee,

4 Phase 1 ST&I Policy in Industrialization Process in Thailand Phase 2 Phase 3 Phase 4 Resource-Based National Research Council of Thailand Labour-Intensive TRF NSTDA S&T Scholarship Prog Golden Jubilee PhD Prog Thailand Sci Park < 0.2% Capital-Intensive R&D Tax Deduction 300% Regional Sci Parks Talent Mobility BIO: Merit-Based Innovation-Driven 2021 Competitiveness Fund Inno Catalogue * ประมาณการ * % Gross Expenditure on R&D/GDP 4

5 Main Challenges Middle Income Trap Inequality Trap Imbalance Trap 5

6 Per Capita Income (US$) 30,000 25,000 Breaking Out of Middle Income Trap Korea 28,166 20,000 15,000 10,000 5,000 - Yr 1970 Malaysia $343 Korea $289 Philippines $209 Thailand $200 China $114 High Income Nation $ 13,000 Middle Income Nation Source: UN Statistics Division and the World Bank. Compiled by STI Malaysia 10,933 China 7,617 Thailand 5,997 Philippines 2,871 $ 2,000 6

7 R&D Investment and Economic Growth Korea Thailand ท มา: IMD, The World Competitiveness Yearbook 2016 และ 7

8 Target for Gross R&D Investment (2018) Source: STI,

9 Rapid Growth of Business-Sector R&D Investment Source: Industrial R&D and Innovation Survey (STI, 2016) 9

10 Sectoral Distribution of BERD 2014 (Million Baht) Distribution of BERD in the Manufacturing Subsectors Source: Industrial R&D and Innovation Survey (STI, 2016) 10

11 5+5 Target Industries: Shift 5 existing sectors towards more knowledge-based and HVA and create 5 new waves of the future First S-curves: Automobile for the future Intelligent electronics High quality tourism Agro and biotechnology Food for the future New S-curves: Industrial Robots Transportation and aviation Bio-based energy and chemicals Digital industry Medical and health industry Source: Ministry of Industry,

12 Shifting Production Sector to Innovation-Driven High Value-Added R&D and Innovation Marketing and Services Knowledge Intensive Innovation Customer Services Prototype Design Development Value Creation Branding Distribution Marketing Low Value-Added Source: Adapted from Stan Shih Smiling Curve (2005) Manufacture Assembly Current Position of Thailand Labour/Resource Intensive 12

13 From Resource-Based toward Knowledge-Based Value Added (Million Baht) 2,500,000 2,000, % Gross Expenditure on R&D to GDP Food, Agriculture & Biotechnology 1,500,000 1,000, ,000 - Source: STI Smart Devices, Robotics & Mechatronics Creative, Culture & High Value Services Health, Wellness & Biomed Digital, IoT, Artificial Intelligence & Embedded Technology 13

14 Current Key Policy Measures for ST&I-Based Industrialization Basic Research Research Design, Development and Engineering Innovation and Business Development Applied Proof of Research Concept Prototyping Pilot Production New Acceleration Business Fully grown Proposal Implementing New STI Law, IP Utilisation and Research Commercialization Promotion Act 300% Tax Exempt of R&D and Innovation Cost Thailand Grand Challenges R&D Fund BOI privileges for R&D and Innovation Investment Innovation Coupon Tax Exemption for Private Equity Fund and Crowd Funding Startup Coupon Startup Funds Legislation/ Regulation Tax Incentives Finance Competitiveness Fund Innovation Catalogue Innovation Market itap - Technical experts to support SMEs Food Innopolis One stop service center for metrology, standardization, testing, accreditation and certification Alliance of Innovation Managers: AIMs Thailand Work-Based Learning Talent Mobility SME Tech Assistant ST&I Infrastructure Innovation Professional ST&I Manpower 14

15 15 EZI: Economic Zones of Innovation Major Industrial Clusters Electronics Food Automotive Petrochemicals Rubber/Palm/Sea Food EEC: Eastern Economic Corridor Regional Science Parks

16 Expected to be finished in 2018 Food Innovation Thai Market Technopolis MTEC BIOTEC NSTDA NANOTEC NECTEC Thailand Science Park AIT TU BU Future Park Rangsit Light Rail 20 km TISTR NIMT TINT RMUTT NSM Rangsit Station RSU RMUTT-Kaset Kukot Station Simummuang Market Kasetsart University Food Research Cluster Don Muang International Airport TISTR FDA Dept. of Medical Sci. KU ARDA 16

17 At Thailand Science Park Modular Design Laboratory Ready-to-move-in 17

18 STI Infrastructure RDI Support Super Cluster Privileges BOI & MOST One Stop Services 18

19 Food Innovation Hub Present Future Target Group 100 Tenants: Research Contract Organisations MNCs LEs SMEs Startups 19

20 Startup Ecosystem Development 20

21 National Startup Promotion Program LAW IMPROVEMENT Reregulation and Deregulation: Earning Stock Option, Vesting, Convertible Debt, Preference Share Source: STI 21

22 Current Policy and Government Support for Development of Startups 22

23 Development of STEM Workforce Source: 1) Commission on Higher Education, 2) Office of the Education Council, 3) Vocational Education Commission 4) The Office of the Basic Education Commission Shortfall in supply of high-level researchers in the near future A need for proactive policy to address the rapid demand of industry 23

24 Rapid Increase in Demand of R&D Personnel in Business Sector Source: Industrial R&D and Innovation Survey (STI, 2016) 24

25 Talent Mobility Talent mobility between public and private sectors and cross-border mobility Restructure of government student scholarship programs Industrial practice school Cross-Border Talent Mobility Current Status of R&D personnel in Thailand Total Ph.D. Master Bachelor Public Sector 36,749 (72%) 9,967 23,449 3,333 Private Sector 14,256 (28%) 734 3,758 9,764 25

26 Entrepreneurial University Industry Demand and Partnership R&D Translation Development Application Commercialization Publication Education Many Universities Few Universities Very Few Universities Source: Adapted from Professor NG WUN JERN, Nanyang Technological University,

27 Re-profiling University Sector 1. Deep industrial understanding and engagement (culture, competence, flexibility internal process) 2. Hands on test it out on site: to know how the technology works, to know how to cost the technology (ability beyond research, especially engineering) 3. Commercialization capability e.g. technology licensing, spin-off, m&a, etc. 4. Industrial connection many industrial partners 5. Government connection not only for funding but also policy support and social contribution 27

28 Re-Profiling Government Research Institutes 1. Custom and market engagement including suppliers 2. Ability to act as intermediary 3. Management capability, team, elimination of silo effect 4. Practice of business report 5. Being focused market feasibility, proof of concept, proof of value 28

29 Internationalization and Partnership HEALTH SCIENCES, STEM EDUCATION BIOTECH, ICT, MATERIALS SCI, NANOTECH, SPACE, RENEWABLE ENERGY, LIFE SCIENCES, HEALTH & ENVIRONMENT BiOFUEL AGRI TECH HEALTH & MEDICINE STEM EDUCATION INDUSTRIAL DESIGN, RAILWAY SPACE TECH AGRI TECH, WATER RESOURCE MANAGEMENT BIOENERGY BIOPHARMA FOOD & AGRICULTURE, HEALTH SCIENCES, VOCATIONAL EDUCATION ICT, DIGITAL MEDIA RUBBER, BIOFUEL, HALAL SCIENCE AGRICULTURE. RAILWAY, SPACE RUBBER, BIOFUEL, HALAL SCIENCE SPACE, STEM EDUCATION ICT, DIGITAL MEDIA BIO TECH, ICT, MATERIAL SCI, NANO TECH, RENEWABLE ENERGY, LIFE SCIENCES, HEALTH & ENVIRONMENT MANUFACTURING FOOD & AGRI TEC, HEALTH SCIENCES, BIOENERGY FOOD & AGRI TECH HEALTH SCIENCES, BIOENERGY

30 Thank You

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