How To Save The Thai Economy

[cavanami]

Hmmmm....can't comment too much on this....

 

How to Save the Thai Economy

 

http://www.nytimes.com/2015/09/11/opinion/how-to-save-the-thai-economy.html?_r=0

 

The return of autocracy to Thailand is putting a hole in the people’s pockets. Sixteen months after the coup that brought down the democratically elected government of Yingluck Shinawatra, incomes in rural areas, where more than 34 million Thais live, have collapsed. Exports fell by 4.9 percent during the first half of 2015, according to the Thai government.

 

Some reasons for this decline are structural. Thailand’s export-dependent, open economy has been roiled by the rise of the Chinese economy and then by its deceleration. After China became a formidable competitor in low-tech industries and electronics, the falling yuan further undermined the competitiveness of Thai exports in the Chinese market.

 

But the junta led by Gen. Prayuth Chan-ocha has also compounded these difficulties. When it should have been encouraging domestic spending, it suspended the massive agricultural subsidies put in place by the Yingluck government. It has announced that it will speed up spending on some 17 so-called mega-road and -railway projects worth $47 billion. But an infrastructure-centered stimulus will not have an impact on domestic demand for years.

 

The generals’ economic policy is hampered by concern for their core constituents, the Bangkok-based establishment: a patronage network among the bureaucracy, the judiciary, the army, business elites and the palace. That network has created staggering inequality: Just 0.1 percent of Thais hold nearly half of the country’s total wealth, according to a 2012 study by the National Economics and Social Development Board, the state economic planning agency.

 

Real G.D.P. growth slowed to 2.8 percent year-on-year in the second quarter of 2015, down from 3.0 percent in the first quarter — and that includes the effects of a surge in tourism; discounting that, G.D.P. actually shrank. (The recent bombing of the Erawan Shrine in Bangkok will dampen foreign visits for a time.) Imports in capital goods have been falling for years, despite the state’s ever more generous incentives for foreign investors.

 

Thais are pouring idle cash into luxury condominiums and high-end shopping malls. Some $1.5 billion have been earmarked for the construction near Bangkok’s historic center of IconSiam, a shopping mall with retail space the size of 75 soccer fields. Touted as a symbol of “eternal prosperity,†this grand palace of commerce is also a monument to the junta’s misguided economic vision: the promise of consumption with too few consumers who have the income to fulfill it.

 

Gen. Prayuth seems finally to have realized these mistakes, and that the economy is his government’s Achilles’ heel. He sacked his economic team last month, replacing its head, Pridiyathorn Devakula, a former central bank governor from the conservative policy establishment, with Somkid Jatusripitak, the architect of many progressive social and economic policies when he was finance minister under Thaksin Shinawatra, the populist former prime minister and brother of Ms. Yingluck. Gen. Prayuth’s government also recently set up a national savings fund long in the making, which aims to help up to 30 million Thais without pensions...

[pasathai1]

allow corruption to run rampant and see how fast things progress ( get done)

[baa99]

Eliminate barfines!

[cavanami]

allow corruption to run rampant and see how fast things progress ( get done)

 

Some years ago, the corruption was well organized...30% for highway projects, xx% for the new airport, etc.

Different time, different gov.