Thailand Rises to No. 15 in Overall of Global Connectivity in DHL Global Connectedness Report
Bangkok–18 Jun–Aziam Burson-Marsteller
The second DHL Global Connectedness Index (GCI) revealed that Thailand has risen markedly from 2005 to 2011, coming in at 15th position in the 2012 DHL Global Connectedness Index in overall connectivity (up from 20th last year). Thailand also spots the 17th place in term of breadth but 33rd in depth.
Thailand is one of the six Asian countries to be ranked in the top 25 for overall connectedness –
a measure of both their depth and breadth of connectivity – with Singapore ranked 2, Hong Kong (12), Korea (14), Thailand (15), Malaysia (16) and Taiwan (21).
Jerry Hsu, CEO, Asia Pacific, DHL Express, said: “The DHL Global Connectedness Index rightly debunks the damaging myth of total globalization as ‘globaloney'. The index reveals a world operating in a range of 10-20% globalization with 50-60% of international flows happening intra-regionally. This means there’s still huge potential for greater connectivity between countries especially since levels remain lower than the financial crisis. The potential gains could reach trillions of dollars and during this period of slower growth, greater international connectedness should be embraced as a vital engine for economic recovery and prosperity.”
Countries in East Asia & Pacific have in large part pursued export oriented economic development strategies. Thailand is one prime example that sees its strategies being complemented by private sector-led development that adopt a regional integrated multi-country production points. Thailand’s strong showing in the Trade pillar, which ranks 5th worldwide, is consistent with its export strategy that has been the key driver of the nation’s economic development. Still, Thailand’s trade remains predominantly Asia centric, with its top export destinations being China (12%); Japan (11%); Hong Kong (7%); Malaysia (5%); Singapore (5%); Indonesia (4%) and Vietnam (3%).
A further key enhancement to the 2012 edition of the GCI is an analysis of industry-level connectedness. The report concludes that the world’s shifting economic center of gravity is reshaping industry connectedness. The migration of production and consumption to emerging markets has specific implications for the three industries: pharmaceuticals, passenger cars and mobile phones.
China, being Thailand’s top destination country, was projected to deliver the largest absolute growth through 2016. IMS Institute has classified it alone as the Tier I “pharmerging” market. From 2011 to 2016, China’s pharmaceutical spending was projected to grow from $67 billion to $161 billion. The remaining BRIC countries (Brazil, Russia, and India) were classified as Tier 2 and were projected to grow from $60 to $103 billion. Although pharmaceuticals trade in Thailand currently leans heavily on imports, the nation’s pharmaceuticals export industry has risen robustly by 66% and imports by 65% since 2006 and is currently valued at approximately at US$4 billion dollars (129 billion THB) .
Thailand’s emergence as an auto parts manufacturer and exporter has also added to its strong trade growth. The Thai Autoparts Manufacturers Association (Tapma) forecasted that exports will total US$15 billion in 2013, up from US$ 11-12 billion in 2012. Exports account for 48% of Thailand’s auto parts industry, giving the country its current status as the top auto parts exporter in ASEAN. Thailand’s rapid industrialization and strong economic growth are a large part driven by export-led development policies, negotiating preferential bilateral trade agreements and enacting broad policies of trade liberalization, particularly in the manufacturing sector.
“As the market leader in the Thai international express industry for the past four decades, DHL has a clear perspective on how the free trade of products and services contributes to economic prosperity. We have the knowledge and capabilities to help companies gain immediate traction in the international market. We remain focused on addressing customers’ needs by staying ahead of changing market conditions,” commented Chananyarak Phetcharat, Managing Director, DHL Express Thailand and Indochina.
The 2012 DHL Global Connectedness Index measures and analyzes the global connectedness of 140 countries, covering 99% of the world’s GDP and 95% of its population. It measures the depth and breadth of countries’ trade, capital, information, and people flows. The report draws on over one million data points from 2005 to 2011 creating a comprehensive analysis of the state of globalization today.