The outbreak of Covid-19 has accelerated Thailand digital transformation process. It is taking place much faster than expected, driven to a degree by the safety measures companies have put in place to fight the pandemic, according to an online survey by U.S. consulting firm Deloitt.
“The majority or 56 percent of surveyed companies have already transitioned to a digital adoption stage, compared to 12 percent before the pandemic, from a digital evaluation stage,” said Narain Chutijirawong, Executive Director of Clients and Industries at Deloitte in Thailand.
Thailand Startup Ecosystem
It is not surprising to see the emergence of new startups in Thailand. The pandemic also opens the opportunity for startups to adjust their services and expand their business to move towards digitization for instance E-commerce and Online Service such as Food Delivery which has seen a tremendous amount of growth. Online Education Platform and Digital Content have also seen a huge rise in users growth as well. Regardless of the line of business for any startup, a software engineer is undoubtedly the most important position in the startup.
They are the ones who literally create programmes from scratch, in which these programmes are the ones that will eventually make or break the startup. Given that these people are high in-demand, there is no doubt that companies are willing to pay exorbitant salaries to hire them. With the low cost of living in Thailand as well as the significantly lower taxes, any business owner is likely to be able to hire a guy with the same level of competency in terms of tech skills at a lower cost as opposed to Europe or even United States.
Booming Population That Is Digital Savvy
With Thailand 4.0, Government agencies have worked with the private sector to create digital infrastructure that’s unmatched in the region. With a 13,000 square kilometre high tech zone outside Bangkok known as the Eastern Economic Corridor, Thailand can now boast Southeast Asia’s most extensive 5G telecommunications network and its most advanced data centre, submarine cable networks and digitalized factories.
Thais have become among the most connected citizens on earth. In 2020, 84 percent of the population shopped online compared with the global average of 77 percent, according to the 2021 Global Digital Report compiled by research firms We Are Social and Hootesuite. Overall, Thailand’s digital economy will triple in value to $53 billion within four years, the e-Conomy SEA 2020 report compiled by Google, Singapore Sovereign Wealth Fund Temasek and U.S. Consulting firm Bain & Co. estimates.
With a total of 32 self-governing cities and 67 million people spread across about 513,000 square kilometres, it is no wonder that Thailand’s is the world’s 21st most populous country. And with over 25 million active Facebook users in Bangkok itself, Bangkok can be coined as the capital city of Facebook. Additionally, over half of the Thais are active Line users. With the high digital consumer rates in Thailand, it is no doubt much easier to penetrate into the Thai mobile and digital market.
One of the lowest corporate tax in Southeast Asia
The corporate income tax in Thailand is set at 20%, which is second lowest in the region, after Singapore’s income tax of 17%. Moreover, if the startup is supported by the Thailand Board of Investment, the startup entity will receive tax exemption for five years. Additionally, with the numerous incentives and investment funds received from major corporations in Thailand, the startup ecosystem in Thailand is likely to accelerate in the coming years.
Thailand is tourist-ready and accessible
Given that tourism contributes to the bulk of the country’s GDP every year, it is not secret that Thailand is home to some of the best food in the world. Moreover, with pristine beaches located a few hours’ drive away from central Bangkok, it makes the perfect weekend break for employees or even a company retreat. Additionally, the Thais are known to be extremely friendly – hence its name, the Land of Smiles.
While the startup scene in Thailand is certainly as established as that of Silicon Valley, the market is definitely not showing any signs of slowing down. In fact, with plenty of support from the local Government as well as large companies, the startup scene in Thailand is expected to accelerate even more within the next few years. Businesses that develop a strong HR function show that they value employees and their business. Small businesses with strong HR practices and processes are better positioned to develop and retain employees, and both are important for business growth.
Managing payroll while keeping compliant with Thailand statutory regulations can be challenging. But you don’t have to go it alone. You can reach out to us to HR and payroll solutions providers so that you can focus on growing your business.
