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Ambitious Government Programmes Boost Thai Lab Equipment Market

A series of government incentives aimed at jump-starting R&D activities throughout Thailand has resulted in a windfall for the country's laboratory equipment industry, according to many attendees at the recent Thailand Lab International event.

Photo: Analytik Jena: Globally concerned, but locally optimistic.
Analytik Jena: Globally concerned, but locally optimistic.
Photo: Analytik Jena: Globally concerned, but locally optimistic.
Analytik Jena: Globally concerned, but locally optimistic.

Thailand has been aggressively seeking to boost its competitive edge over recent years. To this end, it has introduced a number of new tax and financial incentives, while also approving several mega-projects designed to stimulate research and development (R&D) activities across the country. Inevitably, this has spurred local demand for laboratory instruments and equipment, something the Thailand Lab International 2016 expo was clearly keen to capitalise on.

The country is also investing heavily in technology start-ups, all of which require an array of high-tech equipment. In line with this, last year Thailand's Ministry of Science and Technology (MIST) partnered with a number of venture-capital firms to establish a 500 million baht (US$14.4 million) investment fund. This is intended to deliver financing across a range of priority sectors, including next-generation cars, smart electronics,?medical and wellness tourism, agriculture and biotechnology, food, robotics for industry, logistics and aviation, biofuels and biochemicals, and medical services.

According to exhibitors at the event, the cumulative impact of these initiatives has been huge. Assessing the effect on his own business, Wirat Inthavee, General Manager of INS Thai, the local subsidiary of INS, the French multinational scientific testing group, said: "We offer scientific services for manufacturing companies with a particular focus on benchmarking development programmes and testing for the automotive and aerospace sectors in Thailand. The financial and investment incentives available to the sectors that we serve have genuinely boosted our sales prospects. As Thailand is already the leading vehicle and automotive-parts exporter in Southeast Asia, our market has any number of opportunities for growth."

Broadly agreeing, Suraphan Chiamchit, a Senior Service Engineer for BUCHI, a Swiss supplier of laboratory equipment, said: "The Thai government has increased the tax incentives relating to technology and innovation R&D expenditure. As we specialise in laboratory technology for R&D, quality control and production across a range of industries, including pharmaceuticals, chemicals, food and beverages and environmental analysis, we're very optimistic about our current prospects."

According to Orn-Nicha Chanlaem, a Sales and Support Executive with BB Tech & Service, a Bangkok-based importer of pharmaceutical machinery, the tax cuts have proved to be a huge windfall for the sector. He said: "These government initiatives have helped across a broad range of laboratory and scientific expenses, creating a positive domino effect for all of us."

Despite the overridingly positive sentiment, though, some businesses in the sector still have reservations with regard to tepid global growth and its knock-on effect to many of the industries they serve. Typical of these less optimistic suppliers was Atipong Saiyud, Asia-Pacific Business Development Director for Analytik Jena, a German supplier of analytical systems.

Giving his take on the bigger picture, he said: "We have customers in the oil and gas industry. Following the recent fall in the price of oil, many oil and gas companies have diverted their spend from investing in new equipment into maintenance and support.

"This is despite the fact that they could increase their throughput considerably with newer, more advanced machines. As a consequence, many in the sector are still using obsolete, less effective systems and are proving slow to adopt newer technologies."

Predictably, the slowdown in China's economy is also having an impact further afield. Acknowledging this, Julien Cabon, South East Asia Business Development Manager for Interscience, the French microboiology specialists, said: "There has been a number of purchase constraints on account of the slowdown in the Chinese economy. With whatever happens in China impacting everywhere else, some projects have been delayed or cancelled due to subsequent budgetary constraints.

Photo: BUCHI: Buoyed by tax incentives.
BUCHI: Buoyed by tax incentives.
Photo: BUCHI: Buoyed by tax incentives.
BUCHI: Buoyed by tax incentives.
Photo: BB Tech & Service: “Positive domino effect.”
BB Tech & Service: “Positive domino effect.”
Photo: BB Tech & Service: “Positive domino effect.”
BB Tech & Service: “Positive domino effect.”

"Despite these difficulties, though, I remain optimistic about the future. The positive GDP growth within the ASEAN bloc is certainly going to attract more foreign investment. Already, more and more multinationals are moving into the region, especially into Indonesia and Thailand.

"As these economies develop, the quality of pharmaceutical products and food, as well as health concerns in general, will become ever more important. Companies will need access to higher-end technology while there will also be a greater emphasis on traceability. As a provider of microbiological analysis for food, pharmaceutical, veterinary and chemical sectors, this will certainly open doors for us."

Indeed, overall, the forecasts for the region as a whole are largely positive. According to a recent report from BCC Research, a US-based specialist technology consultancy, the Asian market for general labware was worth US$1.4 billion in 2015. It is forecast to be worth at least US$2.8 billion by 2020.

In order to benefit from this growth, Thailand needs to have a far more skilled labour force. Having already identified this particular shortcoming, the Thai government has launched several initiatives designed to remedy the problem – most notably the Thailand Science Park and the Talent Mobility Program, both of which have been designed to encourage knowledge transfer and to enhance competitiveness at a global level.

Emphasising INS' commitment to playing its part in such initiatives, Inthavee said: "Expertise is very important for us. We need to do more than just keep pace with technology, we need to be ahead of the curve. To this end, we participate in seminars and invest in training in order to keep our knowledge base and skills competitive."

For Thanachai Erbkittisawat, a Marketing Specuialist working with Bio-Active Co, a local Thai business, while getting people with the expertise is vital, he believes that increasing automation within the industry may prove to be a game-changer. He said: "Although cutting-edge knowledge and expertise is crucial in our sector, automation will mitigate the existing dependence on a constant supply of highly-skilled workers.

"Now, there's an increasing need for tools that not only increase automation, but also minimise problems, particularly with regard to human error. This is one of the things we're placing a real emphasis on – higher yield of error-free reads and fewer false positives, false negatives and miscalls.

"At the same time, our customers still have access to our traditional support systems, such as user-group meetings, symposiums and online forums. This collaborative approach between researchers, scientists and users not only ensures we stay relevant, but also creates a more innovative environment."

Photo: Bio-Active Co: “Increasing automation will prove a game changer.”
Bio-Active Co: “Increasing automation will prove a game changer.”
Photo: Bio-Active Co: “Increasing automation will prove a game changer.”
Bio-Active Co: “Increasing automation will prove a game changer.”

Thailand Lab International 2016 was held at the Bangkok International Trade and Exhibition Centre from 21 to 23 September.

Geoff de Freitas, Special Correspondent, Bangkok

Content provided by Picture: HKTDC Research
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