Mr. Woraphak Thanyawong, former Chairman of the Advisory Board for Minister of Finance, urges the new government to make preparations and form measures to advance the nation’s semiconductor industry, even though the relative agencies, especially the Board of Investment (BOI), have already introduced several of those measures, which have not been presented to the cabinet yet.
The global semiconductor industry is expanding significantly and is forecasted to reach the value of one trillion USD by 2030, primarily due to the growth of artificial intelligence (AI), electrification, and real time connection among computer and electric vehicle markets. While these markets act as primary stimuli, there is also geopolitical tension between the U.S. and China that incited several companies to utilize the “China + 1” strategy, seeking new manufacturing bases in the South East Asia region.
Currently, Thailand plays prominent roles in the supply chain’s midstream and downstream, such as assembling, testing, and packing the chip, as well as manufacturing electronic components. However, the roles in upstream are still lacking, like designing integrated circuits (IC) and wafer productions. Nonetheless, Thailand has several advantages that can generate opportunities for the industry to grow rapidly, such as its neutral stand in the geopolitical tension, cost-competitive and skilled workforce.
Mr. Woraphak advised the new government to use integrated growth path strategy, expanding midstream and downstream’s advantages, such as the development of top tier packaging technology, before slowly focusing on the upstream in the long term, like designing IC and manufacturing wafers. This strategy will generate ecosystem sustainability and lower the risk from over-investment.
He added that Thailand must use comprehensive supporting factors, including investment incentive, human resource development through collaboration with leading universities, R&D encouragement, as well as developing basic infrastructure and regulation that support investment. Case studies from Taiwan, Singapore, and Malaysia show that the industry needs government support and domestic innovation incubation to advance.
