THE value of Thailand’s digital economy is expected to surge to US$37 billion in 2025, a report says.
The report, entitled “e-Conomy Southeast Asia Spotlight 2017”, identifies this economic sphere as comprising e-commerce, online travel, online media and ride-hailing services.
All sectors of the broader economy would potentially benefit from rapid expansion of the digital economy, including the digitised traditional businesses, existing digital companies, and new entrepreneurs, says the report, which was co-developed by Google and Temasek.
Google Thailand country director Ben King said all business sectors need to be digitised and that most of them had begun on this path.
The company sees a strong trend of digitisation in the finance and telecommunication industries, in particular, in Thailand.
“All business can capture the huge opportunities of the digital economy through the digitisation in three areas - digitising in core business, focusing on data-infrastructure, and digitising the market,” King said.
He said Thailand is at an inflection point. However, it has six roadblocks that need to be overcome.
These barriers refer to users and infrastructure, payments, logistics, customer trust, funding, and talent, he said.
Thailand’s Internet users, as of third quarter of 2017, numbered 45 million, of which 20 million were active users. It needs to get many more millions to become active online users.
Last year, Google has launched two products to address this challenge, which includes Datally and Files Go. Meanwhile, the government’s national e-payment platform, PromptPay, is an example of an initiative that can help to unlock the payment roadblock in Thailand.
“Large private sector investment in the country will drive improvements in logistics and customer trust, such as through warehousing, deliveries and inventories,” King said.
Google said it was encouraged that more funds investment funds were flowing into the region including Thailand.
The report showed that from 2015 to 2017, some US$13 billion was invested in Southeast Asian Internet companies. In 2007, this was US$7.7 billion, with US$4.4 billion in 2016 and US$1.1 billion in 2015.
The majority of funds, around 75 per cent, or US$9 billion, were invested in unicorns – unlisted companies with a valuation of over US$1 billion.
In that period, there were nearly 1,400 deals in the region. Most of them, around 1,095 deals, were fund raising in Series A and Seed rounds.
“It shows that there are a lot of opportunities for Thai Internet companies,” said King.
In order to help the region’s Internet economy to reach US$200 billion in 2025, it required funds of US$40 billion to US$50 billion from 2015 to 2025.
The report focused on four areas of the Internet economy - e-commerce, online media, ride-hailing services and online travel. It excludes education, entertainment, financial services and healthcare.
The report showed that in 2025, there will be 20 million more online shoppers in Thailand, thanks to the increasing ranks of Internet users in Thailand.
Thais spend 4.2 hours per day on mobile Internet platforms, the highest in the Southeast Asia.