Looking ahead, Narit warned that both China and South Korea appear to be turning their investment focus towards Vietnam, which has branded itself as a rising winner in the digital era. China is also expected to emerge as a global leader in artificial intelligence alongside the United States. Without reforms on par with Vietnam, Thailand risks falling behind and losing competitiveness.

Three weaknesses Thailand must address to attract FDI

According to the ASEAN FDI Attractiveness Index, Thailand must improve in three key areas to strengthen its appeal to foreign investors:

Labour and wages – Wages must be aligned with productivity. As Thailand’s average income is higher than Vietnam’s, labour costs are naturally higher. This means Thai workers must deliver higher productivity to justify the wage gap.

Talent and innovation – Thailand needs to enhance research, development and innovation capacity. This includes attracting global talent in future-oriented industries such as artificial intelligence, semiconductors, medical technology, and future food. It also requires stronger support for R&D activities and technological advancement.

Regulations and governance – Outdated or unnecessary regulations should be eliminated to reduce barriers to investment. Policies must promote fair competition, limit the discretionary power of officials, and tackle corruption, which undermines Thailand’s business image. These issues require serious reform to restore investor confidence.

Vietnam’s mega projects raise pressure on Thailand to keep pace

Kriangkrai Thiennukul, chairman of the Federation of Thai Industries (FTI), warned that Vietnam’s aggressive infrastructure push could leave Thailand trailing in regional development if no decisive action is taken. He noted that every ASEAN economy is now competing fiercely to attract investment.

Vietnam has unveiled an infrastructure investment plan worth 10% of its GDP, about 1.5 trillion baht, aimed at driving economic growth to 8% in 2025 and elevating the country to high-income status by 2045. Kriangkrai said this should serve as a wake-up call for Thailand.

Although Vietnam’s plan may not immediately affect Thailand, as mega projects typically take three to five years to implement, the clarity of its long-term vision has already drawn international attention. This could prompt investors who have yet to commit to hold off until they see how Vietnam’s projects progress.

At the same time, regional competitors are also stepping up. Singapore, in partnership with Malaysia, has launched the Johor–Singapore Special Economic Zone (JS-SEZ) to leverage the strengths of both countries, improve business efficiency and attract foreign capital.

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