SMEs to benefit from potential science and technology fund
Recognising that Thailand is in need of promoting the areas of science and technology development, moves are being made to set up a 10 billion baht venture capital fund which will go towards achieving these goals.
The military government, in the form of the National Council for Peace and Order (NCPO), has announced plans to improve science, technology and innovation developments within the small and medium enterprise (SME) community. Taking this lead, the National Science, Technology and Innovation Policy Office (STI) has announced it will hold talks with the Securities and Exchange Commission about establishing the 10 billion baht fund some time this year in order to encourage SMEs to become innovative and develop technology.
This fund would allow the STI to initiate activities within the sphere of technology which would then be developed by SMEs.
The STI board recently approved the raising of the level of tax deductions for research, development and innovation (RDI) from 200 percent to 300 percent in a deliberate attempt to further encourage RDI spending by all sectors of business from large to small.
Various governments have recognized the need for aggressive RDI by business if Thailand hopes to keep ahead of its regional rivals. The secretary-general of the STI has been quoted as saying that Thailand’s competitiveness has been in decline as business costs have risen and there is a need to concentrate on scientific and technological development to regain a measure of that competitiveness.
Venture capital funds were first introduced to Thailand in 2000, but they lay dormant for many years and were finally scrapped by the agencies charged with operating them. Now, the plans for a new and much larger venture capital fund will need to see genuine action.
In practical terms, the STI is aiming to increase the number of science and technology researchers from a current level of nine persons per 10,000 people to 15 by 2016 and 25 by 2021. This is still a very low target by comparison with South Korea, for example, which has 68 persons per 10,000 engaged in the science and technology research field and Taiwan, with 91 per 10,000.
As a South Korean technology officer with Samsung noted, “Easy access to advanced technologies and researchers is the most critical part of developing a technology-based economy for small businesses.”
Currently, most of Thailand’s export revenue comes from commodity-grade products. Value-added exports are still a minority. The country needs to develop this part of its export economy.
One of the key areas requiring funding and encouragement will be universities, especially those outside Bangkok, in order to produce the numbers of scientists and researchers to serve the expected demand from the business sector.