Growing wealth gap belies reform

[webfact]

Growing wealth gap belies reform

By NOPHAKHUN LIMSAMARNPHUN 
THE NATION

 

File photo

 

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.

 

Source: http://www.nationmultimedia.com/detail/business/30345955

 

-- © Copyright The Nation 2018-05-22

[Thaiwrath]

6 minutes ago, webfact said:

the rich appeared to be getting richer

I certainly can't see that ever changing in the foreseeable future

[Samui Bodoh]

"...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...."

 

This is the "Junta effect" If I may coin a phrase. It has been clear to any reader of news that the focus of the economic plan(s) of the Junta for the last while has not been on the proverbial 'little guy' but rather on (usually) Bangkok-based wealthy.

 

And it has been the farmer in particular and the 'little guy' in general who have not been targeted for benefits. Now, to be fair, all over the world there is great wealth disparity, but Thailand has always been bad and it seems has gotten worse. Much worse.

 

I don't have a 'magic-bullet' answer on how to effectively deal with this issue, but I do see one silver lining occurring. The political landscape in Thailand has changed from bygone days; this is evidenced by the Junta all of a sudden realizing that it needs rural votes for legitimacy and taking time (read: abusing their office) to go visit. Will this lead to any long-lasting political change for Thailand's rural people? It is easy to be cynical and say "No!", but I see a permanent change; the question for me is how effectively rural Thailand will use their political power, not if they know they have it. It is my great hope that they do use their strength at the ballot box effectively; currently the Junta (and in future others) need rural votes for legitimacy and if/when rural people/the poor learn to use that power properly, great change will come. The question in my mind now is whether they will use that power effectively in the up-coming election? And if so, how specifically? PTP? FFP? Dems? Another party or combination of parties? The 'little people' have the numbers; can they use them?

 

Finally, let me add a giant 'black eye' to the PTP for not doing more to harness and institutionalize the power of rural folk; the opportunity to cement and enhance their power was there for the taking but wasn't done effectively. Shame!

 

Interesting times...

 

[cornishcarlos]

It is precisely because they have failed the "little people" that they need to get the next election, well and truly, rigged in their favor.

With the lack of results over the past 4 years, there is no way that the majority would vote them in again, if it were a level playing field.

As for the rich getting richer, that has always amazed me, seems to happen worldwide !! Economic depression, rich get richer ?? 

[Samui Bodoh]

2 minutes ago, cornishcarlos said:

It is precisely because they have failed the "little people" that they need to get the next election, well and truly, rigged in their favor.

With the lack of results over the past 4 years, there is no way that the majority would vote them in again, if it were a level playing field.

As for the rich getting richer, that has always amazed me, seems to happen worldwide !! Economic depression, rich get richer ?? 

 

I know it is early, but I would point out that no one "voted them in" in the first place!

 

More coffee, my friend!?

 

[cornishcarlos]

1 minute ago, Samui Bodoh said:

 

I know it is early, but I would point out that no one "voted them in" in the first place!

 

More coffee, my friend!?

 

 

I've already been in the office 40 mins... I'm awake

 

They are in power, whether that was stolen from the people is irrelevant. Therefore, if they won an election, they would have been "voted in again"

I know it's early but stop looking for arguments ?

[YetAnother]

1 hour ago, webfact said:

but its benefits were only short term while its corruption was widespread.

most credible estimates place corruption here at over 30%, poor people don't benefit from any of that; a lot of the rich folks' gain is corruption

[sammieuk1]

These figures could have been plucked straight out of the Conservative party handbook and mirrors the shocking global wealth divide that will eventually end badly.

[mikebell]

The difference between rich and poor is directly proportional to the opportunities for corruption.  There are none in a rice field.

[Juan B Tong]

I hope these fat cats get into the marijuana business.

 

[BEVUP]

World wide

[RichardColeman]

surprised the top half of that pyramid is not people wearing green !

[Eric Loh]

19 minutes ago, BEVUP said:

World wide

Stay local. 

[Anak Nakal]

In Thailand 100 person share pizza.

One rich man eat 98 pieces.

One man with gun help.

[connda]

No surprise on the wealth discrepancy considering that the regime has made it a priority to decimate many of the micro-businesses that not only flourished and were a significant part of the cultural signature that made Thailand what it was: free markets with very low entry requirements , i.e., street vendors and other aspiring entrepreneurs.  While dressed in lakorn style 'period dress' of the 19th century feudal overlords of past, the regime have continued to issue pronouncements that systematically destroy the small market economy that provide the poorest segment of society the edge needed to marginally prosper. 

[Srikcir]

5 hours ago, webfact said:

Growing wealth gap belies reform

“Economic growth without investment in human development is unsustainable - and unethical.” Some points from Globalisation, Inequality and Thailand 4.0 by Angel Gurría, OECD Secretary-General

Amartya Sen Lecture, 24 August 2017 https://www.oecd.org/countries/thailand/globalisation-inequality-and-thailand-4-0.htm

• To become a more inclusive and high-income economy, Thailand needs to go beyond promoting regional integration and business-friendly regulatory reform. It needs to invest in education and life-long skills training to empower its labor force and make it more productive.
• Thailand needs to boost its productivity by providing job opportunities for all Thais, ensuring through continued investment throughout people’s life-cycle, with up-skilling and re-skilling at older ages.
• Despite a steady increase in public funding, Thailand’s innovation performance has not materially changed over the past five years
• In rural areas, it is estimated that up to 47% of 15 year olds are functionally illiterate compared with the national average of around a third.

The junta's 20-year reform plan begins with failure. That doesn't bode well for the average Thai's future.

[chrisinth]

When a government's (controlling body) vision of the future, for farming, lies in e-commerce, it leaves the farmer in the field even further behind, a slave to those that know their keyboards.

 

It is a misunderstanding that everyone is computer literate. This should not be misunderstood.

[Eric Loh]

What hope for the poor when the 20 years plan state that the the target is 5% increase for the poor every year. Didn't start off with a bang when minimum wage increase to 308 - 330 Baht daily. The wealth gap not going to improve when the statement of intent in the junta's 20's years reform plan marginalized the poor for the largeness in big projects and the rich folks.   

[DrTuner]

Well duh. When you oppress they peasants with guns, of course the lords take advantage.

[Baerboxer]

12 hours ago, Thaiwrath said:

I certainly can't see that ever changing in the foreseeable future

 

Indeed. Asia has always had it's "fat cat's" whose families get ever more wealthier and entrenched. Thailand being a good example.

 

But that phenomenon seems to be spreading throughout the world - which isn't going to help the vast majority of poor people to ever be able to improved their lot.

[Baerboxer]

5 hours ago, Eric Loh said:

What hope for the poor when the 20 years plan state that the the target is 5% increase for the poor every year. Didn't start off with a bang when minimum wage increase to 308 - 330 Baht daily. The wealth gap not going to improve when the statement of intent in the junta's 20's years reform plan marginalized the poor for the largeness in big projects and the rich folks.   

 

Indeed - but pray tell what did your vaunted PTP regime due to address this? Introduced a new minimum wage and then did bugger all to make sure it was implemented or address all the illegal low paid immigrants being exploited.

 

The wealth gap isn't going to improve unless some significant changes happen. Certainly not under a Junta or kelptocracy.

[Eric Loh]

19 minutes ago, Baerboxer said:

 

Indeed - but pray tell what did your vaunted PTP regime due to address this? Introduced a new minimum wage and then did bugger all to make sure it was implemented or address all the illegal low paid immigrants being exploited.

 

The wealth gap isn't going to improve unless some significant changes happen. Certainly not under a Junta or kelptocracy.

They didn't have 4 years and didn't have 44. Junta has 4+ years and 44 and still not keen to do much. So you are right that the wealth gap ain't going anywhere. More chance with an elected government as they answerable to the people for their vote. Junta, nah no chance. They don''t answer to anyone except their wallet.