the constantly-changing 21st century. This model is called“ Thailand 4.0” and its key concepts include changing from the manufacture of“ Mass Products” to“ Innovative Products” through technology, creativity, and new methods, and changing from a“ production-based” to“ service-based” economy using the digital system as part of the transformation.,
Insight
Asia
Special Interview
Thailand 4.0 and opportunities for the Thai Food Industry
T he Thai government has announced a new model for industrial development in order to enhance the potential of Thai businesses and enable them to compete in the constantly-changing 21st century. This model is called“ Thailand 4.0” and its key concepts include changing from the manufacture of“ Mass Products” to“ Innovative Products” through technology, creativity, and new methods, and changing from a“ production-based” to“ service-based” economy using the digital system as part of the transformation. This plan covers five key industries, including Food and Agriculture and Biotechnology, and aims to integrate related businesses in the food production supply chain, from upstream agricultural activities, processing, packaging, storage and marketing, to logistics and distribution. As the plan is expected to greatly transform the current successful Thai food industry, some entrepreneurs are curious as to why such a huge transformation is needed. Thai food products are already internationally recognized and, therefore, to what level will Thai entrepreneurs benefit from these changes? And how will this model plan be implemented? Regarding these questions, Asia Food Beverage Thailand had an opportunity to talk with Dr. Tipvon Parinyasiri, Director of FDA’ s Bureau of Food, who is directly responsible for building the development model, and who joined the seminar as a speaker in the first AFB Roadshow this year held under the theme of“ The Road to Standard Food Safety”. She spoke on the topic of“ Driver License for Food Safety” on March 2, 2017, at Novotel Bangkok Suvarnabhumi Airport. Besides addressing the above issues, this seminar also aimed at providing opportunities for participants to raise questions and allowed them to explore the marketing opportunities Thailand will gain from this new development model.
What is the current situation regarding opportunities for the Thai food industry? If we wish to compete in the world market, what opportunities and challenges do Thai industrialists have to prepare for?
In 2015, the value of the Thai food and beverage market stood at around Baht 2.97 trillion, ranking 19th in the world( KASIKORN Research Center, 2015). However, the entire production system management might not be in line with the growth rate and development. Most farmers have had to rely on the government sector’ s advice to produce what the markets need, without looking for prospective buyers and assessing cost benefits. Also, they do not have information about what raw materials manufacturers need, leading to shortages of raw materials for production and forcing manufacturers to import raw materials via middlemen or close down their businesses. Moreover, this manufacturing situation has led to monopolies by a few multi-national buyers, bringing about what we call a“ Supply Chain Funnel.” Consequently, the prices of goods were lowered by middlemen who complicated physical
Dr Tipvon Parinyasiri,
Director of the Bureau of Food Thai Food and Drug Administration( FDA Thailand)
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the constantly-changing 21st century. This model is called“ Thailand 4.0” and its key concepts include changing from the manufacture of“ Mass Products” to“ Innovative Products” through technology, creativity, and new methods, and changing from a“ production-based” to“ service-based” economy using the digital system as part of the transformation.,
distribution around the world, contributing to various problems such as food contamination. Therefore, consumers have begun to be aware of food safety and changed the way they consume food. They no longer buy products which are manufactured for a particular purpose but turn to products with available background information and display innovation( Exhibit 1). For manufacturers, such factors add value to the products and their brands. Meanwhile, current digital technology has transformed distribution channels which were once monopolized by middlemen, but have now been replaced by e-commerce. For example, a number of SMEs have become successful in the online market by using online media to provide information and promote their self-developed products until they become popular. This is in line with the model plan the government is implementing.
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