“A country’s development depends upon not only its economic development but it must be progressing in its social development, and environmental conservation,” says Dr Pichet Durongkaveroj, Thailand’s Minister of Science and Technology. Thailand lags well behind Asian leaders such as Japan, Korea and Singapore when it comes to R&D spending. The current Thai government is out to change this.
“At the end of last year we have endorsed a program where private sector can enjoy 300% tax deduction on research expenditure,” says Dr Pichet. This will be open to international companies operating in Thailand as well as multinational companies. For the first time we will also include the notion of tax exemption for innovation work. In the past it was only for research strictly related to science and technology. “At the moment R&D spending in Thailand sits at around 0.47% and we are not satisfied with that figure. We have a set clear target of 1% of the Thai GDP to be spent on R&D, and for the private sector to increase their contribution. We will offer incentives and facilitate SMEs, large corporations and international investors to create this innovation culture.”
Those in charge of moving the country towards the 1% figure, however, can find cheer in the performance of many of the country’s SMEs who are embracing the green economy, seeing opportunities in innovation and building research ties.
Sudsawart Chiruppapa, Managing Director of Ag-Gro (Thailand), an agrochemical company, believes investments in R&D must also be supported with education across the sector. Mrs Sudsawart explains, “It is true that now we must create higher value products otherwise we simply will not survive. Competition is increasing. “Our own R&D team works with both government officers and local smallholder farmers.
The approach is to analyse the customers’ problems and innovate from there to solve them. After this, we need to then educate. The level of education of Thai farmers could be improved, so our research team and promotion teams support them in the efficient and correct use of our products.
“We have expanded into Myanmar where the level of agricultural education is lower than in Thailand. I have a desire to improve the crops of our neighbouring countries. ”Improved research and education is not just important for economic efficiency, there is a positive environmental impact as well.”
The environmental impact of agriculture also shapes the strategy of Choak Bulakul, Group MD and CEO of Farm Chokchai Group. “We are aware that agriculture is not the most eco-friendly business. It contributes to global warming and it does affect the climate”, says Mr Choak. “Farm Chokchai strives to be as environmentally friendly as possible. We set up the carbon footprint organisation as part of our environmental responsibility drive, which was a pioneering step in Thailand. We offset the carbon we produce, which is calculated precisely, and strive to be carbon neutral.”
Thailand’s business community is now also reaching out to its academic leaders in order to drive the innovation agenda forwards.
Keeen Limited, an innovative industrial ecology management company, have built a research partnership with Mahidol University. Founder and industry pioneer Dr Watson Ariyaphuttarat believes in the concept of “greenovation,” a combination of innovation and green technology. Dr Watson explains, “At Keeen we created an oil eating microbe and developed it into a product to market to industrial companies. The entire product biodegrades along with the oil it is eating. Our products are used to clean industrial waste and for ecological management.”
This is an example of greenovation. It is profitable as it cuts costs for industry, but it is also employing sustainable practices and having a positive environmental impact.
“From inspiration to innovation is one step. Innovation to greenovation is another step. Greenovation to commercialization and then finally satisfaction.”
The agricultural sector also looks to academic partnership to remain globally competitive as Managing Director of Grand Asia Food Industry Mr Phairoj Wangtham-rongwit explains, “We work with Kasetsart University to ensure the best quality raw materials. For example, we grow baby corn on the campus while working with the academics and students. Thailand needs to compete by creating high quality products. The 1% target of revenue spent on GDP we already implement as a company. Being at the forefront of innovative products is the future for the country.”
Mrs. Chomduen Satavuthi, Managing Director of Thai Nondestructive Testing (TNDT) sees collaboration as crucial in elevating standards saying, “The key to our future is education. We should have an ASEAN standard that everyone across the region is brought in line with. When I established TNDT it was the first company of its type, so we have set a standard in the industry and pushed the private sector to rise to this.”
In a country with an already booming private healthcare and medical tourism sector, innovation is driving growth in all areas of treatment and manufacturing. M.E. Meditek Executive Director Joe Tilaka sees investment in research now leading to long term benefits all across ASEAN: “The advantage of having our own research facilities is that we bring solutions with innovation and value addition. We go to hospitals and look at exactly what our end users need in terms of equipment and practices that can save lives. We don’t need to reverse engineer products any more we only need to customise. Customised medical solutions for the member countries of ASEAN will become a niche market of healthcare for the whole world.”
Sustainable development is also a concern within manufacturing as Thai Optical Group Managing Director Torn Pracharktam explains, “We were concerned about the amount of waste and the lack of sustainability in our industry. This is why we have invested heavily into our DoGreen glass technology, which is high performance bio-product glass to be used in optical lenses. Our intention is to continue our research on this technology to reduce the cost of production. Eventually these products will be available to the global market, exported from Thailand.”
Building Entrepreneurial Spirit
Thailand’s SMEs are making rapid advances in research, innovation and sustainable development. Mr Suradech Taweesaengsakulthai, President and CEO of Cho Thavee Dollasien, an integrated logistics company, sees one more component is required for Thai business to be on the path to success: “I believe there needs to be a mindset change in order to encourage more entrepreneurial spirit and ambition. We are aware that in Thailand you cannot tell people what to do or give orders. There is still the ego to be considered!
“We develop products and share these developments not just with clients but the whole business community. In some ways the business leaders in Khon Kaen seek to act as role models, and we can see it does have a positive effect on the whole province, which now is quite far ahead of most provinces.”