Understanding Technological Competitiveness and Supply Chain Deepening in Plastic Auto Components in Thailand: Possible Lessons for South Africa

Abstract

The sectoral study conducted during the first year of the Industrial Development Think Tank identified Thailand as a major international automotive hub to utilise as an effective comparator (see Black, et al., 2018). In particular, Thailand was reported as an example to look at with regard to auto policies, supply chain and cluster development, and for relatively high technological competitiveness. The present paper explores all these dimensions along with understanding the extent of the roles of multinational capital and state bargaining as well as the presence of a strong regional market. This is done in an attempt to derive policy lessons that can aid in the strengthening of South Africa’s local auto supply chain. Along these lines, the current debates on the fourth industrial revolution (4IR), and on its application to an ideal smart factory, brings to the fore a need to understand a broad range of technologies as well as their implications for the gains to productivity in different industries. Thus, 4IR has is seen as having the potential to create entirely new markets, and with them new jobs, that did not exist before. Furthermore, it is seen as potentially facilitating the fast-tracked deepening of supply chains, which can allow for greater levels of integration into international markets.

Keywords: automotive components, global value chains, clusters, technological change, South Africa, Thailand

JEL Classification: L62, O14, O25