Thailand has recently suffered a minor setback; however, the country has proven its resilience against tough economic situations in the past. Several verticals are still displaying signs for strong growth.
The Thai economy has taken a slight tumble over the past few weeks after experiencing contractions in the first half of 2013. Although this speed hump may have sparked worries in some foreign investors, there are still many who believe in the country's potential. In time, gradual improvements in the U.S. and eurozone, along with increase of intra-Asian trade, should lead to a modest increase in global trade flows. The Thai government has also been meeting frequently in order to address the unrest experienced throughout the nation, examining the necessary measures to keep the economy afloat and minimize further contraction for the remainder of the year.
City Surveillance
Due to the political situation in Thailand, several public projects have been put on hold and are expected to be postponed until the end of this year. Although the recent setback will likely result in further delay for these public projects, the government will be able to begin or resume them once the economy stabilizes. With an increased awareness of security, the Thai government is planning multiple large-scale projects across the country from Safe City to transportation. In fact, government projects account for the biggest growth of the security industry in Thailand.
Thailand will be installing more video surveillance cameras and access doors due to upcoming government projects, such as airport and rail expansion. In Bangkok alone, 20,000 more cameras will be installed by the end of 2013, bringing the total number to 40,000 cameras in the nation's capital.
Airports
Currently, the government is carrying out several airport projects to handle the influx of tourists visiting each year. The Thai Department of Tourism reported that international tourist arrivals jumped 21 percent during the first five months of this year. A survey from the University of Thai Chamber of Commerce's Center for International Studies reported that Thailand was the second most visited ASEAN country in 2012, with 22.3 million visitors, and is expected to reach 34.5 million in 2020. Tourism now accounts for 9.8 percent of Thailand's GDP of $34 billion and it is expected to grow to 11.3 percent of the GDP in seven years.
Suvarnabhumi International is preparing to add a new terminal and planning to construct a third runway, acting as a reserve runway for when one of the two main runways are closed for renovation or other possible causes. Don Mueang International is renovating its Terminal 2 to alleviate visitor traffic from Suvarnabhumi and is expected to reopen in 2014. Phuket International is also being expanded to handle its increased amount of tourists wanting to visit the famous beautiful beaches of Thailand.
Rapid Transit
The government also plans to extend and construct new lines for their rapid transit system. The blue line is due to be expanded while constructions of the pink, orange, and yellow line are being planned and pending approval. The purple line was originally due to open in 2014, running from Khlong Bang Phai to Tao Pun, but is now scheduled to open late in 2015. The Mass Rapid Transit Authority of Thailand (MRTA) has very recently approved in principle the building of a new mass transit route, the brown line, running between Kae Rai and Lam Salee. Scheduled to be completed in 2021, it is estimated to cost around $1.3 billion. According to a press release from the MRTA, once the nine routes are operational, the whole system will be able to accommodate 50 million commuters daily. The MRTA Governor also mentioned the state enterprise has already begun its project to develop shopping and business centers as well as real estate on its land in a move to ease the government's funding for the MRT system. The project will also increase the MRTA's revenue.
Along with the various transportation projects planned by the government, the high-speed, long-haul rail is expected to finish completion by 2015. These projects might expect further delay depending on the country's economic situation and how the government plans to finance the projects. The tracks will run from Bangkok to Chiang Mai and Nong Khai, providing a comfortable, inexpensive way for long-distance commuters.
Retail
The retail sector is expected to be the second highest growth sector for Thailand's security industry. This can be attributed to the many new malls being built or scheduled to be built in the upcoming years. Based on an article from the Bangkok Post, The Mall Group is developing another shopping complex scheduled to open in October 2014. Meanwhile, Central Pattana intends to build a new shopping mall in Rayong and capture rising spending power in the industrial eastern province. The Rayong project begins next month and will conclude by the end of 2014. Retailers are hoping to still be able to grow while facing fierce competition in the industry, as Thailand remains a shopping heaven for all incoming tourists.
“Retail sector is seeing a steady increase because retailers are using their security systems as a management tool as well. Some companies such as Checkpoint, will also present an annual loss report for retailers to better assess their store performances,” stated Arnon Kulawongvanich, GM of Chubb Direct. Video surveillance is no longer used for keeping watch over the stores, but also to analyze the stores as well. Customer preferences, crowd flow, store hotspots, etc. are all information that can be provided to retailers for them to adjust accordingly in hopes of achieving higher sales, as well as customer satisfaction. System integrators should also improve their own professional expertise to increase their competitiveness.
Residential and Hospitality
Despite recent events, the construction of residential and hospitality units increased significantly in the first half of the year, making this sector the third biggest market for the security industry. According to Colliers International Thailand Research, the Bangkok condominium market enjoyed a growth of 11 percent year-on-year in the number of newly launched units in the first half of 2013, despite the market slowdown in the second quarter, with 16,071 units in the first quarter and 12, 566 in the second quarter. Forty-five percent of the condos launched in the second quarter had been built around sky trains and subways. The second half of the year is expecting the completion of 66,800 units. The number of projects under construction scheduled to be completed by year's end will break the records of all previous years. The growth of these residential buildings is tightly correlated with government projects, as new constructions of high-speed rails and transit systems lead to the development of such buildings along the rails and transportation systems.
The hospitality sector enjoyed a 12.1 percent year-on-year growth in hotel rooms in the first half of 2013 with the completion of six new hotels in downtown Bangkok, according to CBRE Research. The report stated around 2,250 more rooms will be completed at various levels of accommodations by the end of this year. The Sukhumvit area remains the most popular area of hotel development, where 65 percent of total hotels are located. With so many new units due to be completed, many video surveillance manufacturers and distributors are expecting an increase in video surveillance sales and deployments.
Still Promising
Though some government projects may be put on hold for the upcoming months, there is no doubt that Thailand has a lot to offer. Once the economy stabilizes, government projects will proceed according to plan. Backlogged projects will be put into action once again. Video surveillance has already become standard across all sectors, and Thailand is adopting network surveillance at a rapid speed. Though public investments may not be as strong, private investments are expected to strengthen for the last half of the year.