AMERICAN CHAMBER OF COMMERCE IN THAILAND DIGITAL ECONOMY POSITION PAPER

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1 AMCHAM Background AMCHAM Thailand was formed in 1956 with a membership of 8 American companies and 60 American nationals. Today, AMCHAM has over 650 members, comprising 2,000 executives and professionals. Thailand has long been a favored destination for U.S. investment and trade, and AMCHAM has been proud to support these efforts for over 60 years. AMCHAM members have invested 50 billion US dollars in Thailand, providing more than 200,000 local jobs. Through the AMCHAM Thailand Foundation, the Chamber donates over 10 million baht a year to improve the quality of education and English proficiency in Thailand. AMCHAM Philosophy and Mission AMCHAM believes in the principle of open market, the rule of law, the integration of Thailand s economy within ASEAN and the Asia - Pacific, and investing in building a modern and diversified economy through upgrading in education, infrastructures and the digital economy. AMCHAM has been part of Thailand s economic development for many decades. We believe in Thailand s potential for growth and would like to support and contribute to Thailand 4.0 policy. To achieve this objective, it is imperative that new and innovative policies are introduced and certain laws need to be amended to make it easier to do business in Thailand. We believe in a level playing field. The Trusted Internet : A multi-stakeholder model for cybersecurity A trusted internet is a basic requirement for businesses and consumers alike to have the confidence needed to fully realize the digital economy s potential. Well-designed laws regarding privacy and data protection, as well as good codes of conduct established by the private sector will help ensure that trust in the system is maintained. Confidence in network and operational security is also a necessary component. Collaboration among government, business and industry sectors, and the public at large will be necessary to achieve these goals. AMCHAM would like to be regularly updated on Thailand s digital economy laws, including the Computer Crimes Act, Personal Data Protection Act, including cross-border data transfer, the adoption of APEC Cross-Border Privacy Rules, and the impact of Europe s General Data Protection Regulation. 1

2 Human Resource Development To realize the immediate goals of Thailand 4.0, as well as the longer-term target to produce 500,000 digital entrepreneurs within 20 years, the local workforce of ICT professionals will require significant enhancement, starting now. In addition to longer-term solutions such as improving Thailand s primary, secondary, and tertiary education system, and the development of an Englishspeaking ICT workforce, there must also be more immediate steps taken, including encouraging foreign ICT experts to come to work in Thailand, transfer their skills here, and collaborate with local startups on innovative development. Many structural problems currently prevent this, including outdated regulations from the Department of Employment and from the Immigration Bureau which effectively block local companies from hiring foreign ICT experts. We note the recent announcement of the Strategic Talent Center (STC) initiative but the details remain unclear, and in any case it will not be open to non- BOI companies until October Thailand should also adopt the use of an IT competency framework, which will facilitate regional cooperation on the free movement of skills. Any local, Thailand-specific certification requirements for ICT skills should be avoided. E-Government E-Government is more than just replacing papers with electronic copies of the same. It is about redesign of workflow and data management to allow for new and enhanced services as well as greater efficiency for existing ones. Thailand s progress on this has been slow. Regulations should be implemented across all government agencies which recognize and accept paperless processes for transactions in both the public and private sector. Eastern Economic Corridor (EEC) There is a need for policy continuity, consistency and predictability. On government incentives, there is a need for clarity and simplicity. There should not be different interpretations by various government agencies concerning tax and other related incentives. 2

3 The benefits offered under the EEC, including the EECi and the Digital Park, should be extended to also include opportunities for virtual participation by ICT-related investment, without requiring a physical establishment in the Park. By definition, remote, cloud-based architecture for innovative products and services will be a key component of making Thailand 4.0 a reality. The new incentives should recognize this. The huge difference in benefits for new and existing investors needs to be addressed. Existing investors should not be at a disadvantage for their earlier investments in Thailand. Mobile broadband technology The Thai government has recognized the need to leverage digital technology to grow the economy, to implement the Thailand 4.0 policy initiative, and use technology to create income through networks and new innovation thereby avoiding the middle-income trap in the nation s progress towards a sustainable value based economy. Thailand has identified the EEC as an area within which to implement Thailand 4.0 and upgrade existing industries and add new industries. Mobile broadband technology use has grown faster than any other industry and will be central to the realization of Thailand 4.0. New mobile applications and services are spreading rapidly, drawing consumers deeper into the mobile economy. 5G is coming, and will bring a variety new mobile capabilities. Some have already begun, such as the internet of things which has the potential to revolutionize consumers interactions with nearly every industry. For mobile technology to fully contribute to Thailand s digital economy the right conditions and policies must be conducive to adoption, investment, development and innovation. Fostering Innovation through Strong IP Frameworks The mobile industry is a good example of how patents and an open licensing policy has led to rapid market growth, the rise of many companies, and innovation on multiple fronts. Underlying the mobile ecosystem of networks, devices, applications, services, components, devices, and infrastructure there are core communications technologies. The core technologies are developed through decades of research and development by a variety of companies. 3

4 Today s mobile technologies are the cumulative result of thousands of technological innovations and inventions by individuals and companies so it follows that a key enabler to digital development and the growth of the mobile industry are strong IP frameworks, which require both strong IP protection (especially patent protection) to incentivize innovation and licensing to ensure broad access to the enabling technologies. The licensing model ensures that patented technologies are universally available while providing a mechanism to compensate innovators (through licensing revenue), thereby encouraging additional investment in next-generation technologies. It is beneficial, to the growth of the digital economy, that the Thai government is undertaking a review of its patent system and amending the Thai Patent Act New measures to reduce the patent backlog, improve registration efficiency and streamline and expedite patent application, such as the recruiting and training of additional patent examiners will contribute to technology innovation in Thailand. Improving enforcement measures will further assist innovation based economic growth. Enabling the economic contribution of mobile technologies Mobile technologies and networks are direct contributors to the economy through the activities of mobile network operators. The use of those technologies and networks are indirect contributors to the economy as they enable downstream businesses and services. As mobile technologies evolve new businesses and services are created. The evolution of 3G to 4G services is spurring the growth of more data intensive business activities, and the internet of things. To allow 4G services to reach their potential, and to allow the introduction of 5G services, suitable radio frequency spectrum must be released to the market and licensed in a timely, and transparent fashion. Related questions What are the time frame and current status of draft laws related to the Digital Economy? The Draft Amendment to the Electronic Transactions Act. The Draft Electronic Transactions Development Agency (Public Organization) Act. The Draft Cybersecurity Act. The Draft Personal Data Protection Act. 4

5 While the Draft Cybersecurity Act is being finalized, which agency is responsible for developing and implementing the National Cybersecurity Policy and framework? How could AMCHAM share inputs and insights? General Recommendations On human capital development, many AMCHAM member companies have their own initiatives and partnership with local technical colleges/universities. AMCHAM is interested to be part of the government initiative for education-industry collaboration. On the 12 Committees of Public-Private Collaboration, AMCHAM would like to engage with some of these Committees which we believe we could contribute, such as Innovation & Productivity; Development of New Industrial Clusters; Attraction of Investment and Basic Infrastructural Development; Legal & Governmental Mechanism Reform, and SMEs/Start-up. August 29, 2017 ******************** 5

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