Thailand should prioritise practical artificial intelligence (AI) applications that boost productivity, widen access to services and create jobs, rather than focusing too heavily on attracting large data centres and developing advanced AI models, says the World Bank.
Ajay Banga, president of the World Bank Group, said Thailand was well positioned to benefit from AI, given its advanced manufacturing capabilities and role in supplying components for major data centres.
The priority now is to translate investment into broader economic gains, including higher incomes and employment, he said during the IMF-World Bank annual meetings in Bangkok.
Thailand has a realistic chance of becoming a high-income economy by 2037 if it builds on its strengths in tourism, high-tech manufacturing, agribusiness and digital services. With economic growth at about 2% a year, the challenge is to ensure that growth benefits workers and households, not just investors.
“Be wary of a K-shaped economic recovery, where growth drives only capital growth and not enough growth of people and their income,” Mr Banga said.
TWO-PRONGED STRATEGY
Thailand should pursue large-scale data-centre investment alongside practical AI applications, rather than treating the two as mutually exclusive, he said.
However, if the government had to prioritise its next round of funding, he would favour applications addressing everyday economic and social needs.
These include helping small merchants access credit and manage inventories, as well as improving healthcare, education, skills development and agricultural productivity.
AI could also widen access to medical screening. Mr Banga cited technology that analyses a person’s cough through a mobile phone to identify those at higher risk of tuberculosis and refer them for further testing.
Such applications could benefit developing economies without requiring them to match the computing power, electricity supply, skilled workforce and capital available to the US and China in developing advanced AI models.
Reliable electricity, internet connectivity and digital public infrastructure remain essential for adoption.
“You cannot outrun the basics,” Mr Banga said, stressing the need to connect people and enable them to access digital services.
MOBILISING PRIVATE CAPITAL
The World Bank also stresses the need for greater private sector investment to support AI adoption and economic transformation, as rising public debt and tighter fiscal conditions limit government spending.
The bank mobilised US$112 billion in private capital in the latest year, up from $60 billion a year earlier and $35 billion in fiscal 2022.
He attributed the increase to efforts to improve regulatory certainty, expand political and commercial risk insurance, provide local currency financing and develop investment products for institutional investors.
The bank has raised its risk insurance capacity from $6 billion when he took office to $25 billion this year. It is also working with the International Monetary Fund to develop local capital markets in 40 countries and bundle smaller infrastructure projects into larger investment opportunities.
However, attracting private capital to fragile, low-income countries remains difficult, underscoring the need to support micro, small and medium-sized enterprises, which are key sources of jobs and economic activity.
Development efforts should focus on job creation and opportunities for young people. Public financing should target areas where concessional funding is most needed, while private and philanthropic capital can support other projects and help mitigate investment risks.
For Thailand, the challenge is to ensure that investment in technology and advanced manufacturing delivers wider benefits.
Combining major technology projects with practical AI applications, stronger digital infrastructure and support for smaller businesses will be crucial to turning economic growth into jobs and higher incomes, he added.