Bangkok, Thailand, July 2024 — The Grant Thornton International Business Report (IBR) for Q2 2024 reveals a nuanced outlook among Thailand's mid-market business leaders. With a Business Health Index score of 16.3, Thailand continues to outperform its ASEAN, Asia-Pacific, and global peers. However, underlying economic concerns tell a different story and highlight the need for strategic vigilance.
Balanced Perspective on Business Sentiment
Ian Pascoe, CEO & Managing Partner, shared his insights on the findings: "While the improved sentiment is encouraging, it's imperative to address the underlying economic vulnerabilities. The cautious optimism must be complemented with robust strategies to tackle demographic shifts, evolving skill requirements, and the critical need for technological investments."
Workforce and Skill Development: A Priority
The IBR indicates that 56% of Thai businesses aim to expand their workforce, a positive sign. However, only 47% plan to invest significantly in skill development, highlighting a gap that could impact future competitiveness in a digital economy. This disparity underscores the importance of aligning workforce expansion with comprehensive skill enhancement programs. Without substantial investment in skills, the ageing population and evolving digital economy could pose significant challenges.
Technological Investment: Essential for Sustained Growth
Despite a 60% intention to increase technology investments, Thailand lags behind regional peers, emphasising the urgent need to accelerate digital transformation efforts. Enhancing technological capabilities is crucial for maintaining a competitive edge in the global market. The relatively low level of investment in technology could hinder Thailand's ability to compete internationally, especially as other countries in the region continue to advance rapidly in this area.
Economic Outlook and Sectoral Focus
The report reflects a dual perspective: optimism driven by improved business conditions contrasts with tempered expectations due to external uncertainties, particularly in the export sector. Increased investments in tourism signal a strategic focus on sectoral recovery post-Covid-19. However, the contraction in exports and industrial production remains a significant concern, suggesting that businesses need to adapt to shifting global demand and potentially explore new markets.
Cybersecurity and ESG: Growing in Importance
The report highlights emerging areas such as cybersecurity and ESG compliance. Only a small fraction of Thai businesses view cybersecurity as a significant constraint, indicating a potential underestimation of risks. Additionally, the readiness to adapt to evolving ESG regulations suggests cautious optimism among Thai businesses. As these areas become increasingly critical to global business operations, Thai companies must enhance their awareness and preparedness to mitigate potential risks and leverage opportunities for sustainable growth.
About the IBR
The Grant Thornton International Business Report (IBR), initiated in 1992, offers a comprehensive look into the sentiments of mid-market businesses globally. It aggregates the perspectives of approximately 3,748 C-suite executives across 31 economies, providing insights through quarterly surveys and interviews conducted in various languages. The Q2 2024 data stems from interactions with CEOs, managing directors, and other senior executives across diverse industry sectors, focusing on the period from April to May 2024. In partnership with Oxford Economics, the IBR utilises a unique index to gauge mid-market health, developed through rigorous analysis, model development, and correlation testing with macroeconomic indicators.
