National Committee Targets Major Semiconductor Investment
The recent establishment of the National Semiconductor Policy Committee marks a significant step towards fostering technological advancement, according to industry leaders. While welcoming the initiative, chaired by Prime Minister Anutin Charnvirakul, industry experts emphasize that substantial investment alone will not be enough to position the nation as a robust semiconductor manufacturing hub. The committee has set an ambitious goal of attracting 2.5 trillion baht in investment to the chipmaking industry by 2050.
Bridging the Gap: Investment and Human Capital
Pimjai Leeissaranukul, chairwoman of the Federation of Thai Industries (FTI), stated, “We need both investment and technological know-how.” She highlighted that foreign investors’ commitments to developing semiconductor production facilities must be paralleled by a strong focus on human resource development. “We need to build chip designers,” Mrs. Leeissaranukul asserted.
The National Semiconductor Policy Committee has outlined plans to cultivate over 230,000 highly-skilled workers to support the burgeoning semiconductor industry. This strategic workforce development is seen as crucial for driving economic growth, creating high-quality employment opportunities, increasing national income, and enhancing the country’s long-term global competitiveness.
Domestic Industry Challenges and Outlook
Despite the potential for growth in semiconductor technology, the broader Thai industrial sector is facing headwinds. The Thai Industries Sentiment Index (TISI) for May saw a decline to 84.7 points, its lowest in 48 months, down from 85.3 in April. This downturn is largely attributed to the struggles of local non-tech industries in the domestic market.
Panitarn Pavarolavidya, secretary-general of the FTI, explained, “Consumers bought more imported electrical appliances, clothes and furniture because they are cheap.” He added, “This is not good as it puts pressure on the manufacturing sector.” The influx of affordable imported goods is creating intense competition for domestic producers.
Economic Concerns and Lending Cautions
The May TISI survey, which polled 1,347 entrepreneurs across 48 industries, revealed that the sluggish domestic economy was the primary concern among respondents. Difficulties in accessing loans followed closely behind. Data from the first quarter of this year indicates a 4% year-on-year contraction in loan grants for small and medium-sized enterprises, reflecting ongoing caution among financial institutions regarding lending practices.
Looking ahead, Mr. Pavarolavidya expressed optimism for an improvement in the TISI for June. He cited the recent peace agreement between the US and Iran, which has eased tensions in the Middle East, as a potential positive factor for the global economic outlook.
Potential in High-Tech Manufacturing
On a more positive note, some members of the FTI are already involved in semiconductor manufacturing, producing chips for internal use or for sale to other companies. Reports indicate strong demand for high-tech products manufactured by foreign companies operating within Thailand, which is contributing to the strengthening of the export sector.
