Business and Market Overview on Thailand

ECONOMY. Thailand has a pro-business marketservices to the general public are overall adequate.
economy driven by strong foreign investmentsInternet broadband services are mostly
and export oriented manufacturing especially inconcentrated in Bangkok. Cities and towns are
electronics, foods and automobiles. Thailand'swell connected by roads but lacks super highways
exports account for 60% of the country's GDP.connecting Thailand's cities and major towns. Cities
Thailand experienced strong economic growththe major towns are served by airports and well
prior to the Asian economic crisis of 1997 withconnected by buses and rail
GDP growth averaging 9.4% annually. However,system.INTERNATIONAL TRADE. Thailand's major
the crisis adversely affected businesses intrading partners include Japan, US, China, Hong
Thailand and saw the value of the Thai BahtKong, Singapore, Malaysia and Taiwan. Main
decline by more than 50% against the US dollar.exports from Thailand include electronics, vehicle
Since the crisis, the economy has grown on aand vehicle parts, textiles, garments, footwear,
growth path.Thailand's GDP was US$163.5 billionseafood, processed foods, rice, rubber, jewellery,
with a GDP per capita of US$2,537 in 2004.electrical appliances including computers. Main
Thailand's GDP grew by an average of 4.6%imports include machineries and equipments, raw
annually from 2000 to 2004 driven mainly bymaterials and finished products, consumer goods
exports of high technology products mainlyand fuels.CONSUMER USAGE OF TECHNOLOGY.
electronics. Inflation remained below 2.0% fromThere were nearly 17.3 million installed fixed-line
2000 to 2003 but increased to 2.8% by 2004.telephones in 2004 giving a penetration of 40%
However, unemployment showed a declining trendof all Thai homes installed with telephones. The
from 3.6% in 2000 to 1.8% by 2004.Nearly 60%penetration of mobile phones increased from just
of Thailand's workforce is involved in the7% of the population in 2001 to 42% or 27 million
agriculture industry but contributed to only 9.8%mobile phones by 2004. The penetration of
of the country's GDP in 2004. The servicescomputers is still low but increased from 5.1% of
industry contributed towards 46.1% of Thailand'sthe households in 2001 to nearly 12% by 2004.
GDP and manufacturing 44.1% during the period.The number of internet users reached an
Major industries include tourism, electronics,estimated 8 million in 2004 but most of the
textiles and garments, processed foods,internet users are concentrated in Bangkok and
beverages, agriculture produce, jewellery,the major cities and towns. The penetration of
furniture, plastics, vehicles and vehicle parts andtelevision in homes in 93% indicating many
mining of tungsten and tin. Major agriculturelow-income homes have televisions.RETAIL
products include rice, tapioca, rubber, corn,MARKET. The retail industry in Thailand totalled an
sugarcane, coconuts, soybean andestimated US$24.5 billion in 2004. There are nearly
milk.DEMOGRAPHY. Ethnic Thais account for 75%300,000 traditional "mom and pop" stores in
of Thailand's 65 million population and another 11%Thailand accounting for 65% of the total retail
are Chinese or Sino-Thais who have assimilatedsales. However, there are 4,500 modern retail
into the Thai culture or are from mixed marriages.establishments (hypermarkets, supermarkets,
Minorities include Malays who lived mainly indepartment stores and convenience stores)
southern Thailand and account for 4% of theaccounting for 35% of the total retail sales. Most
population. Others include the Mon, Lao, Khmers,of the modern retail establishments are located in
Puan and Karen minorities and immigrants fromBangkok. Shopping in modern retail establishments
India. Nearly 95% of the country's population areis increasingly popular and more establishments
Buddhists while Malays in Thailand areexpected in the near future.FOOD CULTURE. Rice
predominantly Muslims. Thai is the nationalis the staple food but while those in central and
language while languages used by the minoritiessouthern Thailand prefer white fragrant rice those
include Malay, Isan and Khmer. Schools teachin northern Thailand prefer the glutinous variety.
English but proficiency is low and generally, theThai dishes are generally hot and spicy but foods
educated elite are more proficient with thefrom the northern region are generally milder.
language.The majority of the Thai population stillThais are less adapting to western foods even if
live in the rural communities though the proportionthey could afford it compared to consumers in
of the urban population is increasing. Thailand'sSingapore and Malaysia. However, bakery and
urban population increased from 22% of the totalcoffer shop chains are gaining popularity among
population in 2000 to 31% by 2004. Thailand'syoung professionals who have adapted to
capital and major city Bangkok accounts forwestern culture.Khal Mastan is a Senior Consultant
nearly 8% of the country's total population. Otherwith Pegasus Business and Market Advisory (
major cities include Nonthaburi, Pak Kret, Hat Yai,based in Malaysia. He involves himself in business
Nakhon Ratchasima, Chiang Mai and Udonand marketing research and provides consulting
Thani.Thailand successfully reduced the povertyservices on markets in Southeast Asia namely
level from 27% in 1990 to 10% by 2004. TheMalaysia, Thailand, Singapore, Indonesia, Philippines
proportion of the population categorised belongingand Brunei. He has more than 20 years
in the low-income household is estimated at 60%experience in the region and work experience in
while middle and high-income households accountvarious industries. He holds a bachelors degree in
for 30%. The average household income inBiochemistry and an MBA. He can be contacted at
Bangkok is twice than the nationalor +6 (03) 7726 5373 in Malaysia.
average.INFRASTRUCTURE. Telecommunication