SPECIAL REPORT: EEC apart, NCPO has done little to enhance people’s lives, say economists

[webfact]

SPECIAL REPORT: EEC apart, NCPO has done little to enhance people’s lives, say economists

By WICHIT CHAITRONG 
THE NATION

 

 

ECONOMISTS SEE some economic improvement during the term of the junta-backed government but are disappointed at the paucity of its major economic reforms.

 

The National Council for Peace and Order ended the controversial rice-pledging scheme implemented by the Yingluck Shinawatra government but is still providing subsidies to farmers albeit at a much smaller scale than previously.

 

 

Somchai Jitsuchon, economic director at the Thailand Development Research Institute, estimated that four years of support to farmers under the Prayut Chan-o-cha premiership equalled less than one year’s spending by Yingluck’s and said the new, hard-line stance had severely affected many people.

 

“Cutting large subsidies combined with lower prices globally for farm products, have significantly reduced farmers’ income,” said Somchai addressing the deteriorating conditions affecting millions of Thais who depend on the agricultural sector. 

 

The second policy to affect the poor had been the removal of large numbers of stalls from Bangkok’s pavements in order to clear street clutter and ease traffic flows.

 

“Those good intentions have resulted in huge income losses for street vendors, estimated at Bt60 billion to Bt70 billion a year,” said Somchai.

 

The government has implemented a welfare card programme for the needy, providing cash and credit worth Bt300-Bt500 per month for each of the 11.4 million welfare cardholders.

 

However, Somchai doubts the accuracy of the card database and fears that not only are many poor people not benefiting but also many others who do receive cash and loans may in fact not be eligible.

 

He said it was vital that the database be reviewed and updated.

 

One aspect of the economy that gives Somchai cause for optimism is the government-initiated Eastern Economic Corridor (EEC), which he hopes can be used to drive the next cycle of economic growth.

 

“It has a potential to be a game-changer,” he said.

 

Other than the EEC, though, Somchai said it was hard to find beneficial reforms that the government could take credit for.

 

He said the NCPO had not tried hard enough to help small and medium-sized enterprises (SMEs) to adopt and adapt to new technologies. This had the potential to enhance the management of their companies without requiring expensive training, he said.

 

The government had also failed to provide training appropriate to the new economic landscape to low-income groups while Prayut himself had not paid sufficient attention to education reforms that could have contributed to economic development and reduced inequality.

 

Somchai wants to see an increase in government spending on social protection.

 

“Currently the government allocates less than Bt4 billion to support infants up to the age of three. The budget should increase to about Bt17 billion to Bt18 billion in order to ensure that no poor kids are left behind,” he said.

 

Many economists also say that the government has failed to loosen its controls over the nation’s finances, opting instead to consolidate its power and create many regulations which impede economic decentralisation, said Somchai.

 

He hoped to see a leaner public sector and the privatisation of many state-owned enterprises – but he admitted that would be an uphill task.

 

 

Pairoj Wongviphanond, former dean of Chulalongkorn University’s economics faculty, expressed his disappointment with the government’s tax policy. 

 

It should allow local governments to collect more in property tax but the law being drafted by the government has been watered down from the first draft proposed by Finance Ministry officials,” he said. “Nor has the government succeeded in collecting heritage tax from the rich, thanks to large exemption clauses.

 

“The overall picture has seen no big change, only incremental changes.”

 

Vimut Vanitcharoenthum, economist at Chulalongkorn University, also spoke about private investment remaining sluggish and far below its pre-1997-crisis peak. 

 

“Thailand’s firms have in recent years invested a lot overseas because investment returns are higher there,” said Vimut. 

 

However, he pointed out that it was partly because Thailand was becoming an ageing society, so consumers spend less compared with those in other emerging Asean countries such as Vietnam, Indonesia and the Philippines. The government faces tough challenges, he said. 

 

Nevertheless, the Thai economy has started building momentum for higher growth – GDP in the first quarter of 2018 rose 4.8 per cent, its highest rate in the past 20 quarters, largely due to recovery in the global economy and public spending on investment projects.

 

Prinn Panitchpakdi, managing director of CLSA Securities Thailand, however, said while the headline number looked good, it wasn’t so rosy if you dug a little deeper and saw that the grassroots economy had not yet recovered and SMEs were struggling to survive. 

 

This is partly responsible for the current net outflow of capital -– foreign investors have withdrawn about Bt100 billion so far this year.

 

Political uncertainty has also increased as the government cannot guarantee there will be no further delays in the holding of the general election. 

 

Opposition politicians, non-government organisations and university students have started to intensify their campaign for a poll this year.

 

“Should the election be delayed much longer than a few months from the schedule of February next year, it could damage confidence and limit the local stockmarket index’s ability to rise above 1,900 this year,” he added.

 

Source: http://www.nationmultimedia.com/detail/business/30346051

 

-- © Copyright The Nation 2018-05-23

[Samui Bodoh]

The first economic policy of the Junta was to end support to the rice farmers who had the temerity to support the PTP. Yes, the rice-pledging scheme was a terrible policy, but one has to ask; what was the replacement? Nothing, just cutting off the funds to the farmers. These are some of the poorer people in Thailand and it is reasonable to think that the Thai government should support them (every government on the planet supports their farmers). Alas, No.

 

"...The second policy to affect the poor had been the removal of large numbers of stalls from Bangkok’s pavements in order to clear street clutter and ease traffic flows.

“Those good intentions have resulted in huge income losses for street vendors, estimated at Bt60 billion to Bt70 billion a year,” said Somchai.

The government has implemented a welfare card programme for the needy, providing cash and credit worth Bt300-Bt500 per month for each of the 11.4 million welfare cardholders..."

 

Yes, the second policy was to take away the livelihood of the urban poor in order to ensure that they are dependent on the government, thus ensuring that they do not have political power. And, do it in a half-ass manner as it doesn't particularly matter; they are poor and therefore powerless, best to keep them that way...

 

Third, the EEC. Hmm... where are the Junta from? Aren't they the Eastern Tigers? My my, what a coincidence! I wonder if anyone has checked out land-ownership records of all the industrial-designated zones, transport routes, and potential port areas? Perhaps not, that could be dangerous...

 

As an outsider, It seems to me that the economic policy of the Junta has been to remove or diminish any power held by the rural masses, and combine that with taking away potential power of the urban poor. And throw government money at the place they came from and likely own land and factories.

 

It isn't subtle...

 

But hey! They are just the poor, right? It isn't like they are 'good people'; if they werre 'good people', they'd already be rich...

 

[YetAnother]

1 hour ago, webfact said:

Cutting large subsidies combined with lower prices globally for farm products, have significantly reduced farmers’ income,” said Somchai addressing the deteriorating conditions affecting millions of Thais who depend on the agricultural sector. 

add the watch general and the contrast becomes clear

[colinneil]

The report says the NCPO has done little to enhance people lives !!

Not exactly correct, they have certainly enhanced ole fattie, Prayut bank accounts and their own no doubt.

[RichardColeman]

4 hours ago, webfact said:

However, Somchai doubts the accuracy of the card database and fears that not only are many poor people not benefiting but also many others who do receive cash and loans may in fact not be eligible.

................or are being scammed out of it by Thai government officials !

[smutcakes]

There does seem to be some pick up in the economy however this is being driven predominantly by exports and tourism. However this does not seem to be trickling down for one reason or another. Decent opinion piece in the other paper which expands a little on the reasons for it.

[Anak Nakal]

Army take poor people money.

Keep poor people poor. 

That is reason for coups.

[Eric Loh]

Reality check for those who glorify those heavily massaged growth data and declared that Thailand economy is doing well. Even the feel good GDP growth is not a true reflection of the country economy and it is not a balance growth. The junta has paid too much attention to the big businesses and very little for the average citizens. The budget also has very little to improve the live of the citizens especially the pork barrel spending on military hardware and increase in salaries for the junta government. 

 

 

[AGareth2]

5 hours ago, Samui Bodoh said:

But hey! They are just the poor, right? It isn't like they are 'good people'; if they werre 'good people', they'd already be rich...

but they will get to vote

one day

[petermik]

7 hours ago, AGareth2 said:

but they will get to vote

one day

don,t hold your breath.....

[Krataiboy]

The junta has done little to help the disadvantaged masses and the wealth gap continues to widen worryingly.

The country’s GDP is sufficiently strong to completely eliminate poverty, according to a recent Oxfam report. Yet after four years of the military at the helm, one in ever ten Thais is still living below the official poverty line.

 

Thailand now ranks as the world’s third most unequal nation, behind Russia and India.

 

As debt levels have soared to record levels among the labouring classes, the number of Thai billionaires on the gravy train has increased from five to 28 in just seven years.

 

The junta insists the huddled masses will get a better deal courtesy of the 20-year development plan with which the next democratically-elected government will be lumbered. But with hardly any butter on the bread after four years of miltiary rule, why should anyone believe their promise of jam tomorrow?

[Srikcir]

11 hours ago, webfact said:

“The overall picture has seen no big change, only incremental changes.”

Deputy Prime Minister Somkid in charge of Economic affairs offers an excuse:

• "Somkid defended his government against growing criticism over a lack of successful reform during the past four years under the junta. Reform could not take place during a period of economic hardship, he insisted.  
• How do we start reform when there is no money in our pocket?” he asked, referring to economic growth of below 4 per cent annually over the past four years since the military coup." (underline emphasis added)

http://www.nationmultimedia.com/detail/business/30345956

If Prayut was a standup comedian, he chose Somkid well as a shill.

 

 

 

[sammieuk1]

Its absolutely juntastic for generals and embezzlers . 

[chama]

Probably didn't need a study to determine this...just ask the everyday person on the street.