Deputy Prime Minister Somkid Jatusripitak yesterday warned large Thai and other Asian firms against remaining complacent with present growth and spending no money on new technology and innovation to upgrade production and competitiveness.
Speaking at the Nikkei Asia300 Global Business Forum in Bangkok, Mr Somkid urged the Thai private sector to capitalise on the geopolitics of Thailand to keep up with rising Asian trends.
"Asia is rising with outstanding growth rates while the world economy is weak and fragile, especially with the new US policy forming so-called upside-down geopolitics," he said. "Asia is moving to become the centre of the world economy."
Mr Somkid stressed the importance of the private sector's role in handling such challenges, saying the role of the private sector is similar to that of a warrior.
"The country, abundant in its number of strong economic warriors and capable in its chosen industry, will surely be in a position to have high economic success," he said. "Japan, South Korea, Singapore, Taiwan, and Hong Kong are all examples that stood out in the past. However, for the future, China is becoming an interesting example that should be studied and closely followed."
India is another country that stands out in terms of technology and human resources, especially in terms of IT and digital, driving Indian businesses to become leaders in Asia.
In Nikkei's ranking of businesses that had outstanding performance in Asia, there were 10 Indian businesses in the top 30 of the Nikkei 300, more than any other nation in Asia, Mr Somkid said.
"In the world of the future, technology, innovation and a sharp business model are the important weapons that a future economic warrior will need to have," he said.
"Internet, the Internet of Things (IoT), big data and artificial intelligence (AI) are now crucial for responding to diverse and fast-changing consumer demands in the modern age. Business models that are quickly adaptable and reach out directly to the consumer, to respond to their unfulfilled demands, are replacing the traditional business structure. Size is no longer an important factor and size may even be a hindrance if lacking such elements."
He cited the latest issue of the Nikkei Asian Review, which reported that large companies listed on the stock exchange are still slow in moving to invest for the future, causing investors to harbour a lack of confidence in their future potential and consequently curbing the growth of stock prices.
Large companies that are fast-moving, dedicated to investing in technology to build innovation, could nonetheless retain leadership and continue to have an impressive business performance.
Mr Somkid also called on national unity, saying the countries that have unity, a capable government, a strong private sector and preparation for the future are the ones that will be successful and poised to move to the front line of development.
"On the opposite end are countries that remain asleep, stuck in the past, and with a private sector that is timid, outdated and does not dare to change," he said. "I express my regrets in advance that not only will they unable to reap the benefit from the approaching opportunity, but will also face deterioration and recession that can hardly be avoided."
Thiraphong Chansiri, chief executive of SET-listed Thai Union Group Plc, said the industry is facing five key global trends that have an effect on business: global free trade versus protectionism; currency fluctuations; the slowing global growth engine, particularly for China's economy; emerging disruptive technology; and escalating international conflicts.
To deal with these global trends, he said companies need to be better able to deal with uncertainty.
"Even we in the low-tech industry cannot ignore technology, as it can change the industry's landscape," Mr Thiraphong said. "Technology now migrates into the retail sector in many countries and is leading to price competition."
Central Group of Companies chief executive Nicolo Galante said Central has been applying technology and preparing human resources to embrace growing omni-channel marketing, which is a multichannel approach for retail sales.
The structure at the management level was changed to enable the group to move towards the 4.0 digital era.
Under the change, the online business of each business unit under Central has grown by more than 50%, most strongly at Office Mate and Central Department Store.
"The digital transformation is challenging for us," Mr Galante told the audience at yesterday's forum. "The technology wave is fast approaching Thailand and we have gone beyond it."