THE TWELFTH NATIONAL ECONOMIC AND SOCIAL DEVELOPMENT PLAN (2017-2021) Office of the National Economic and Social Development Board Office of the Prime Minister Bangkok, Thailand Foreword The Twelfth National Economic and Social Development Plan (2017-2021) was formulated during a period when the world was experiencing rapid change and becoming even more integrated, whilst Thailand itself was undergoing reforms. Since the Ninth Plan, the principles of the “Sufficiency Economy Philosophy” have been and continue to be a vital element of development strategy as they underpin the promotion of moderation, reasonableness, and resilience. These principles have significantly contributed to balanced and sustainable development in Thailand. In formulating the Twelfth Plan, the Office of the National Economic and Social Development Board (NESDB) adhered to the 20-year National Strategy framework (2017- 2036), the country’s Sustainable Development Goals (SDGs), the Thailand 4.0 Policy, as well as other reform agendas. In order to set out development directions and strategies to achieve the objectives of “Security, Prosperity, and Sustainability”, the NESDB regards participation by a broad cross-section of society to be a crucial principle in the drafting of this Plan. The National Strategy is to be translated into action through the five-year National Economic and Social Development Plans, commencing with the Twelfth Plan. Each strategy within the Twelfth Plan lays out development agendas as well as flagship projects which need to be accomplished in order to prepare human capital, society and the economy for future challenges. Clear implementation mechanisms as well as monitoring and evaluation procedures are also identified to bring about genuine development that is effective, beneficial, and sustainable for all. Office of the National Economic and Social Development Board Office of the Prime Minister Contents Page Part 1 Overview of the Twelfth Plan 1 Part 2 Assessment of the Development Situation External Situation and Trends 29 Internal Situation and Trends 37 Part 3 Objectives and Development Targets of the Twelfth Plan 77 (2017-2021) Part 4 Development Strategies Strategy 1 : Strategy for Strengthening and Realizing the Potential 80 of Human Capital Strategy 2 : Strategy for Creating a Just Society and Reducing 94 Inequality Strategy 3 : Strategy for Strengthening the Economy, and 102 Underpinning Sustainable Competitiveness Strategy 4 : Strategy for Environmentally-Friendly Growth for 132 Sustainable Development Strategy 5 : Strategy for Reinforcing National Security for the 149 Country’s Progress towards Prosperity and Sustainability Strategy 6 : Strategy for Public Administration, Corruption Prevention, 160 and Good Governance in Thai Society Strategy 7 : Strategy for Advancing Infrastructure and Logistics 177 Strategy 8 : Strategy for the Development of Science, Technology, 198 Research, and Innovation Strategy 9 : Strategy for Regional, Urban, and Economic Zone 206 Development Strategy 10 : Strategy for International Cooperation for Development 230 Part 5 Implementation, Monitoring and Evaluation of the 245 Twelfth Plan Part 11 Overview of the Twelfth Plan Part 1 Overview of the Twelfth Plan 1. Overview of the Twelfth Plan During the period of the Twelfth National Economic and Social Development Plan (2017- 2021), Thailand will undertake a range of reforms aimed at solving various long-term accumulated fundamental problems. These reforms will take place within a global situation of rapid change and closer connectivity. Competition within the global economy will be more intense, while the global society will be drawn closer together in an increasingly borderless world. In addition, the rapid pace of technological change will significantly affect either people’s daily lives or their economic activities. Meanwhile, Thailand will face an array of fundamental strategic development factor limitations which will provide an obvious obstacle to the country’s future development. The period of the Twelfth Plan will be an extremely challenging time for Thailand to undertake substantial reforms by accelerating the development of science, technology, research and development, and innovation as key factors in empowering the development of all aspects needed to increase the country’s competitiveness with an exceedingly competitive global economy. Furthermore, in addition to persistent levels of income inequality, Thai citizens still lack the knowledge, skills, qualities and attitudes needed to realize the country’s development potential. The demographic structure has turned to be an aging society, resulting in labor shortages. The size of the Thai population of working age started to decline in 2015, and the population structure will reach a definitional ‘aged society’ by the end of the Twelfth Plan. Meanwhile, natural resources and the environment have rapidly deteriorated in both quantity and quality, resulting in higher economic costs and devastating negative impacts on people’s quality of life. In addition, public administration has been inefficient, lacking in transparency, and highly corrupted. All of these factors will be constraints to national development and will leave some parts of society behind. With such a variety of challenges which are major obstacles to the country’s development in the long run, it is commonly recognized that, in order to elevate Thailand to be a developed country with security, prosperity and sustainability, Thailand must accelerate the improvement of fundamental strategic development factors in all respects, such as: increasing investment in research and development; developing science, technology, and innovation; this has to be accomplished together with accelerating the enhancement of labor skills, both of new entrants to the labor market and existing workers, in order to be compatible 2 with the targeted improvements in the production and service sectors, and with technological changes. Furthermore, human society should be developed in such a way as to achieve well- being in all age groups and to have the capacity to cope adequately with daily life changes through the leverage provided by quality education, learning and skills enhancement, and through quality public health services in all areas, and by promoting the role of social institutions to imbue good, disciplined people with strong values and social responsibility. Moreover, henceforth the spatial development and enhanced economic potential of cities must be emphasized. This will be accomplished through improved environmental standards, rationalization of land use, organized city planning, and strengthened urban security which is consistent with Livable Cities benchmarks. The spatial development of cities and the realization of their economic potential has the purpose of spreading economic and social opportunities and creating new economic and income-generating bases, thereby decreasing social inequality in Thailand and increasing competitiveness by promoting livable cities as the new economic bases in both the interior up-country areas and the major border areas. In addition, the next five years is a crucial time for Thailand to push forward international trade and investment growth as well as domestic investment and economy enhancement as the main engines of development. Thailand needs to make agreements on international trade and investment, and cooperate with allied nations to expand development through bilateral and multilateral arrangements, together with strengthening regional and sub- regional linkages and pursuing a proactive investment strategy boost for the regions. International cooperation frameworks at all levels will provide opportunities for Thailand to maximize the advantages derived from its geographical location to develop itself into a major regional economic and trading hub. Therefore, the Twelfth Plan focuses on enhancing international regulatory and institutional linkages at the implementation level and at each border check-point, side-by-side with developing domestic physical infrastructure networks to link with those of neighboring countries. Meanwhile, Thailand must be prepared to function as a gateway to West and East Asia. The Twelfth Plan emphasizes using physical infrastructure linkages as a basis for the development of areas, economies and communities along transborder economic corridors, upgrading their competitiveness and distributing wealth to the communities, provinces, and cities along these economic corridors as well as other domestic linkage areas. Additionally, Thailand must execute a proactive strategy for creating an entrepreneurial society and intensively supporting Thai entrepreneurs to invest abroad in order to gain capital revenues and potential business opportunities. The aim is also to promote value chain linkages within the region, especially with Cambodia, Lao PDR, Myanmar, Vietnam (CLMV) and ASEAN. The major forms of international cooperation for Thailand’s development from now on will be economic cooperation on trade and investment, social development cooperation, 3 environmental cooperation, and security cooperation in various frameworks including at sub- regional, regional, and global level. Not only must existing bilateral and multilateral agreements be efficiently utilized, but also new agreements will be constructed based on the concept of free trade and competitiveness improvement, in particular promoting the use of the cooperation frameworks of ASEAN and with development partners