Transcript Thailand - University of San Diego Home Pages

Country Study:
Thailand
Overview
• Thailand was never colonized. A constitutional
monarchy was established in 1932
• Military Coups are common and play an important
role in political environment of the country
• Export-dependent, open economy, free enterprise
(exports of primary products – rice, rubber, tin, teak)
Overview (cont.)
• GDP per capita - $8,500, growth rate 4-6%
• Population – 65 million, working age population 70%
• Population growth rate 0.62%, HIV/AIDS 1.4% (more
than 600,000 people)
• Relatively homogeneous country Thai 75%, Chinese
14%, Buddhism 95%
Overview (cont.)
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Agriculture 14%, Industry 44%, and services 44%
Gini coefficient 0.42%, Inflation rate 5.5%
External debt: $65 billion
Export growth (2005-2008): 17%
Development Model
• In the First three Five Year Plans (1967-76) Thailand
emphasized economic growth
• Economic development policies emphasized in the
plans were – infrastructure development, agricultural
development (irrigation, crop diversification), land
reforms and assistance for IMPORT SUBSTITUTION
• Fourth Plan (’77-81) emphasized decentralization of
industry and growth from cities to rural areas
• It also marked the beginning of export-oriented
industrialization
Development Model (cont.)
• Industrial Estate Authority of Thailand established
several estates in rural and semi-rural areas along
with export zones
• 51 companies in these estates produced a range of
products: chemicals, automotive equipment,
processed food, and electrical equipment
• Fifth Plan (1982-86) emphasized rural poverty and
creation of jobs
• During Sixth Plan, Thailand privatized its public
sectors enterprises
• Growth rate doubled (at 10%)
- a streak of double-digit growth for more
than a decade
Development Model (cont.)
• Sustained growth (moderate yet 8%) redistribution of
income and human resource development because
the focus of the policy makers in Seventh Plan
• Inverted U-Shaped Kuznets curve
Development Model (cont.)
• The Eighth Plan coincided with financial crisis in
Asia
• 1.5 million people were plunged back in the poverty
during 1997-1999
• People below poverty line represent 16% of the
population (9.8 million)
• IMF rescue plan in effect ($17 billion)
• Capital inflows declined by 14% initially
• Currently, the policy of “sufficiency economy” is
emphasized
Current Problems and Development
• Anti-government demonstrations, riots in Airports,
ethnic conflicts in Southern states
• Thaksin supported farmers and developed a sevenpoint policy
• In 2006, military coup ousted Prime Minister Thaksin
• Political instability, riots and corruption has
tarnished the international image of Thailand
• Foreign investment and tourism are adversely
affected. Tourism contributes 6% to GDP