The Thai economy has improved since the coup of 2014, Prayut Chan-ocha, the previous junta leader and the current prime minister, said at a forum attended by foreign ambassadors and diplomats on Thursday.
“Since I became prime minister on October 24, 2014, it can be seen that the Thai economy has improved, as the economic expansion in 2014 was at 1 per cent because of conflict and instability,” he said.
“But the economy has expanded from 3.1 per cent in 2015 to 3.4 per cent in 2016 and it has continued to expand until 2020, which is when Thailand faced great challenges, such as the ongoing crisis in the global and domestic economy with regards to trade and foreign investment,” he added.
According to the World Bank’s data, Thailand’s economy grew on an average of 7.5 per cent during the golden era of 1960-1996 and 5 per cent during 1999-2005 following the Asian Financial Crisis in 1997.
After 2005, the economy expanded by 4.97 per cent in 2006 and 5.44 per cent in 2007 before the Global Financial Crisis hit in 2008 which took the expansion down to 1.73 per cent that year and to a recession of -0.69 in 2009.
Bouncing back from a low base, the economy expanded by 7.5 per cent in 2010, 0.84 per cent in 2011 because of protests, and then back up to 7.24 per cent in 2012.
Political instability then took the GDP expansion down again to 2.69 per cent in 2013 and 0.98 per cent in 2014.
However, the economy never headed back to its true potential of 5 per cent per year.
Instead, there was an expansion of 3-4 per cent between 2015 and 2018, and then a drop of 2.37 per cent in 2019.
The World Bank said in January 2020 that the reason for the drop in 2019 was due the slowdown in the global economy, and “Thailand’s long-run structural constraints, with slowing investments and low productivity growth.”
The Economic Monitor report for Thailand also said that if current trends continue with no significant pickup in investment and productivity growth, Thailand’s average annual growth rate will remain below 3 per cent.
The report came out before the coronavirus pandemic hit Thailand in February.
Income inequality
Prayut has also highlighted income inequality as one of the social issues in Thailand that “has been ongoing for decades.”
According to the World Bank’s “Taking the Pulse of Poverty and Inequality in Thailand” report that was released in March, the country has made “substantial” gains on key social and economic development since 1988.
“However, over the past few years, household incomes and consumption growth have stalled nationwide, with declines among households at the bottom of the income distribution,” the report read.
The results from the study also revealed that between 2015 and 2018, the poverty rate in Thailand grew from 7.21 per cent to 9.85 per cent. At the same time, the number of people living in poverty has also increased from 4.85 million to more than 6.7 million.
The “reversal of poverty reduction” is related to “worsening economic and environmental conditions” between 2015 and 2018.
“Over the past few years, Thailand’s growth rate has been lower than other large economies in the developing East Asia and Pacific region,” the report read. “In October 2019, Thailand had one of the lowest GDP growth rates in the region at 2.7 per cent.”
Prayut said the economy should be able to get back on track to its pre-COVID state in two to three years and the government is currently looking for ways to solve its economic problems.
The prime minister added that with regards to the social issues within this country, cooperation and understanding are important to lessen conflict and provide stability and confidence within and outside the country.
He said the current crisis differs from the ones in the past and any problem that has already happened could be fixed without creating any more conflict within society.
“Do we want to get back to where we were? I do not believe so, and now is not the time,” Prayut said while referring to the political conflict before the coup.
“But in the end, it is up to all of you because you are the ones that will decide Thailand’s future and I will do my job on the administrative side as best as I can”, he added.
For the past three weeks, anti-government and pro-democracy protestors, many of whom are students, have been out on the streets to protest against Prayut’s administration.
Their three demands are to dissolve the parliament for a new election, rewrite the constitution to make it more democratic, and for Prayut’s government to stop harassing dissidents.
