Indicators look good on paper but discrepancy between rich and poor has continued to widen under the junta
SINCE THE May 2014 coup d’etat, the Prayut government has been running the Thai economy with a tight grip facilitated by special powers under Article 44 of the charter.
For the past four years, the results have been generally mixed with the majority of Thai people’s economic wellbeing remaining stagnant or worse.
Over these years, multiple polls have often suggested that the government’s economic management was not delivering results, especially among medium- to low-income groups.
On the other hand, the rich appeared to be getting richer as the country’s economic growth since 2014 has averaged nearly 4 percentage points per annum, but the wealth is not being evenly distributed.
Big business, export-oriented industries, tourism and related businesses were among the major beneficiaries of economic expansion during this period.
Farmers, in contrast, have been hurt by the relatively low market prices of agricultural and other commodities in the past several years, leaving most unimpressed by the government’s economic performance.
Other low-income wage earners have seen minimal tangible benefits, as the country’s official minimum wage has increased just slightly from Bt300 per day to Bt305-322 over those years.
Yet the latest 2018 Forbes list of Thai billionaires paints a sharp contrast as the country’s richest businesspeople enjoy a disproportionate wealth boom, driven by a stock market upturn and a stronger Thai baht.
Many of these billionaires have been closely allied with the government’s Pracha Rath projects, which use partnerships between the public and private sectors as a state mechanism to tackle economic inequality and related issues.
The Forbes list of the 50 richest Thai billionaires shows their combined wealth rose nearly one-third over the past year to a total of more than US$162 billion (Bt5.2 trillion).
Dhanin Chearavanont and other key members of his family have remained the country’s richest people on the Forbes list, with a combined wealth of US$30 billion due to high share prices for their major holdings in 7-Eleven, agro-industrial and other businesses.
Dhanin’s CP Group is among several Thai conglomerates involved in the Pracha Rath projects, which aim to help community-based enterprises in various provinces to grow their businesses as a means to narrow the economic gap and tackle rural poverty.
Other Thai billionaires such as Charern Siriwatanapakdi of Thai Beverage Group, the Chirathivat family of Central Group, and the Chokewatana family of Saha Group have also been closely associated with the Pracha Rath schemes.
While Pracha Rath and other projects of the Prayut government are arguably sustainable in terms of alleviating rural poverty, they have been less popular among farmers and other low-income people when compared to the previous government’s campaigns.
The previous government’s massive rice-pledging scheme cost an estimated Bt500 billion in taxpayers’ money but its benefits were only short term while its corruption was widespread.
To deliver better longer-term results, policymakers need to come up with more creative programmes to tackle poverty, which are also not politically addictive and whose cost-benefit ratio is more reasonable.
According to the latest Nida Poll conducted in February this year, Prime Minister Prayut Chan-o-cha unsurprisingly got high scores for his decisiveness in restoring law and order over the past years.
However, his government’s economic management remained a bone of contention as most respondents said the economy had not been good for them largely due to the uneven distribution of wealth over recent years.
The same opinion was shared by respondents to another survey conducted by Bangkok Poll earlier this year – they also urged the government to further improve its economic management.
Despite unfavourable world market prices for farm and other commodities that are out of government control, as well as other negative factors, the government still owes the public a better performance on the economic front.