THE Thai economy expanded throughout the two years that the military-controlled government of Prime Minister Prayut Chan-o-cha has been in power but this growth has not reached the country’s fullest potential, Dr Anusorn Tamajai, Rangsit University’s vice president for research and academic service said today.
Public sector investment and tourism have visibly improved over the past two years but private sector investment and consumption only edged up slightly.
However exports continuously decreased for two years in a row due to Thai products being less competitive in the global market and decreased global trade. It is noteworthy that exports started decreasing even before this government came to power.
While Dr Anusorn is positive about the country’s overall economic stability he pointed out that there are issues about economic justice with income distribution to reduce inequality still not very good and could potentially deteriorate.
Income in the agricultural sector has dipped steadily on the back of lower prices of farm products. The government has decreased price intervention and while this has reduced fiscal burden it has also substantially cut private sector buying power.
Moreover in not increasing minimum wage for over two years it has led to lower-skilled workers facing economic difficulty.
Dr Anusorn projected that the Thai economy should grow by 3.2-3.5% this year which is an improvement over 2015 and 2014 with this being due to investment and tourism improving while consumption edged up a little.
Public sector investment has visibly jumped from a decrease of -7.3% in 2014 to 29.8% in 2015, with the biggest outlay being in 2015’s fourth quarter at 41.2%, and is expected to grow by 10% this year.
However private sector investment has only slowly recovered while consumption has not changed significantly over the past two having only moved up slightly.
Clear recovery has been seen in tourism from a -6.5% reduction in 2014 to a growth of 20% in 2015 and expected growth of 10.4% this year with total arrival of 33 million tourists.
Dr Anusorn also mentioned that the government still lacks a clear strategy to cope with disruptive technology which will affect business and industries, economic and political systems as well as the society and lifestyle.
Examples include the impact of FinTech on monetary and economic systems and the new electric car technology, particularly Tesla, on the automobile and auto parts plus energy industries and employment.
Another example is the advent of Blockchain which is a public ledger of all Bitcoin transaction that have ever been executed.
TOP: It is tourists like these who are strolling through Bangla Road at Phuket’s Patong Beach who are helping drive Thailand’s economic growth. Photo: Ben Reeves (CC-BY-2.0)
INSET: Dr Anusorn warns against the impact of disruptive technology.
By Thai Residents reporters