World Bank says Thai poverty rate increases, farm income slides

[Jonathan Fairfield]

World Bank says Thai poverty rate increases, farm income slides

By Patpicha Tanakasempipat

 

FILE PHOTO: A worker cultivates rice plants at Sompot Tubcharoen's farm in Bangkok, Thailand August 28, 2018. REUTERS/Soe Zeya Tun

 

BANGKOK (Reuters) - Thailand needs to invest in education and create jobs in higher-income sectors, the World Bank said in a report on Thursday that showed a rising rate of poverty as the country's economy slowed.

 

Thailand is Southeast Asia's largest economy after Indonesia but has lagged its regional peers and grew at its weakest pace in five years in 2019.

 

The country of 69 million reduced overall poverty over three decades to just under 10% in 2018 from more than 65% in 1988, but the trend started to reverse from 2016, data from the World Bank report showed.

 

The rise in the number earning below the national poverty line, set at less than 90 baht ($2.85) a day in 2018, was mainly because of falling incomes for Thailand's bottom 40%, many of whom were urban workers and rural farming households, between 2015 to 2017, the country report found.

 

"Wages for people in agriculture and manufacturing did not increase as much as we needed to reduce poverty, but the other way around," Birgit Hansl, World Bank Thailand's country manager, told a news conference. Hansl blamed lower commodity prices and major droughts.

 

Nearly a third of Thailand's workforce is in the low-income agricultural sector, which produces and exports commodities such as rice, natural rubber and sugar for global markets.

 

Thai farmers often rely on financial support from loans or handouts from governments to help offset declining farm prices.

 

Previous measures included a populist rice subsidy scheme from a previously-toppled civilian government buying millions of tonnes of the grain from farmers at prices above the market between 2011 to 2014.

 

Such social welfare programmes can help to soften the impact of economic volatility and reduce poverty in the short term, the World Bank said.

 

But it warned they could prevent longer-term productivity by delaying farmers' moving to higher-paying jobs in the manufacturing or service sectors, or preventing them switching to more crops that are more profitable or less vulnerable to drought.

 

"Perhaps some policies here in the past that were related to support to farmers on growing a specific crop might have prevented faster transformation," Hansl said.

 

The organisation also said Thailand needs to improve access to education for children from lower-income families, policies on safety nets and create better jobs to address inequality.

 

(Reporting by Patpicha Tanakasempipat; editing by Barbara Lewis)

 

-- © Copyright Reuters 2020-03-05

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[4evermaat]

5 minutes ago, Jonathan Fairfield said:

...Thai farmers often rely on financial support from loans or handouts from governments to help offset declining farm prices.

And maybe also incoming deposits from foreign nationals?

 

Anyway, let me step out of the way, as the usual TVF will be all over this thread.  Headline has the insinuating "I told you so" written all over it.

[chickenslegs]

11 minutes ago, Jonathan Fairfield said:

The country of 69 million reduced overall poverty over three decades to just under 10% in 2018 from more than 65% in 1988, but the trend started to reverse from 2016, data from the World Bank report showed.

It would be interesting to know how the uber wealthy top 5% fared during the same time period.

My guess is that they did better than ever.

 

[PatOngo]

3 hours ago, Jonathan Fairfield said:

The country of 69 million reduced overall poverty over three decades to just under 10% in 2018 from more than 65% in 1988, but the trend started to reverse from 2016, data from the World Bank report showed.

Interesting, I'm curious as to what the catalyst for the 2016 turn around was? Could it be......………….Nah!............Surely not!

[tomacht8]

3 hours ago, chickenslegs said:

It would be interesting to know how the uber wealthy top 5% fared during the same time period.

My guess is that they did better than ever.

 

Not a single fat corrupt fish has been caught and punished in the past 4 years. Transparency, use and control of tax funds is no longer traceable to the public.

[jabis]

We're closing in the third portal of crazy, THB weakening to a *year* low


Only a couple of portals to go to sanity ????  

[Soikhaonoiken]

Well no surprise with this report, this Government is doing nothing for its citizens, just lining their own pockets.... 

[Creasy]

Bringing happiness to the people since the latest coup

[webfact]

Stalled growth set back Thailand's progress in poverty reduction: WB

By THE NATION

 

 

Thailand's poverty on the rise amid slowing economic growth, according to a new World Bank report today (March 5).

 

Thailand had successfully reduced poverty over the past three decades from over 65 per cent in 1988 to under 10 per cent in 2018.

 

 

However, the growth of household incomes and consumption have stalled nationwide in recent years. This resulted in a reversal in the progress of poverty reduction in Thailand with the number of people living in poverty rising, according to the World Bank report which analyses recent poverty and inequality trends based on official statistics.

 

Between 2015 and 2018, the poverty rate in Thailand increased from 7.2 per cent to 9.8 per cent, and the absolute number of people living in poverty rose from 4.85 million to more than 6.7 million.

 

The increase in poverty in 2018 was widespread - occurring in all regions and in 61 out of 77 provinces. In the Central and Northeast, the number of poor increased by over half a million in each region during the same period. The conflict-affected South became the region with the highest poverty rate for the first time in 2017.

 

The report finds that the recent increase in poverty coincides with emerging and shifting economic and environmental challenges in the economy.

 

Over the past few years, Thailand's growth rate has been lower than other large economies in the developing East Asia and Pacific region. Thailand had one of the lowest GDP growth rates in the region, at 2.7 per cent during the fourth quarter of 2019. Droughts have affected the livelihoods of farmers who are already typically the poorest.

 

"Recent poverty trends demonstrate that despite Thailand's level of economic development, households are still vulnerable to shocks and weak economic conditions," said Birgit Hansl, World Bank Thailand /Country Manager.

 

"To meet Thailand's aspiration of achieving high-income status, Thai households will need better protection from income shocks such as ill-health, job-loss and natural disasters. It will be equally important to support the creation of more productive and higher-paying jobs."

 

Since official poverty data were first published in 1988, Thailand's poverty rate has increased in five instances, the most recent in 2018 and 2016 with the previous three instances occurring in 1998, 2000, and 2008 around the time of financial crises. Thailand is the only nation in Asean to experience several increases in poverty since 2000.

 

While Thailand performs better than its Asean peers on many international indicators of well-being, such as education enrolment among primary school-aged children, access to water, sanitation, and electricity, and has a low international extreme poverty rate based on $1.90/day at 0.03 percent, inequality remains an issue.

 

The population at the bottom 40 per cent of the income distribution is not sharing as well in prosperity, and in the recent period of 2015-2017, consumption and income growth in this bottom 40 per cent were negative. The reversal in trend among this bottom 40 per cent during this period is related to declines in all forms of labour incomes, including a stagnation in wage growth and declines in farm and business incomes.

 

"A more nuanced picture of inequity and a better understanding of vulnerability will be needed to guide Thailand's next steps towards building a more prosperous society for all." said Judy Yang, World Bank economist and author of the report. "Eliminating persistent pockets of poverty will require growth strategies that take into account short-run risk mitigation and long-run investment needs."

 

The report calls for active interventions and investments to help transform Thailand. In the short-term, Thailand will need to reinforce its safety nets. Populations that are vulnerable would need to be better identified and swift action is needed in creating better jobs for households in a rapidly changing economy.

 

In the longer term, investing equitably in the next generation will be key. The next generation will be smaller due to demographic changes and lower fertility rates. Every child will need to be given a fair shot and be provided the health and education opportunities to reach their full potential. This will help households break out of the generational poverty trap, support an aging population, and boost Thailand's growth prospects.

 

Source: https://www.nationthailand.com/business/30383428

 

-- © Copyright The Nation Thailand 2020-03-06

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[bangkokfrog]

7 hours ago, Jonathan Fairfield said:

World Bank says Thai poverty rate increases, farm income slides

I think the reason for the 2016 reversal may lie in the second part of the headline. The poor were able to survive because they could always rely on farm income. Thanks to changing demographics, poor education and government ineptitude in destroying the agricultural sector, the tide has turned. This doesn't bode well for the future.

[saengd]

I'm not sure at all that the government has destroyed the agricultural sector, I think what happened is:

 

- more people left farming attracted by easier and bigger money in the tourism sector, and

- large scale farming undercut prices and eroded market share of small farmers.

Edited March 5, 2020 by saengd

[PatOngo]

4 hours ago, tomacht8 said:

Not a single fat corrupt fish has been caught and punished in the past 4 years. Transparency, use and control of tax funds is no longer traceable to the public.

Name 3 who've been caught and punished in the past 40 years!

[rkidlad]

54 minutes ago, saengd said:

I'm not sure at all that the government has destroyed the agricultural sector, I think what happened is:

 

- more people left farming attracted by easier and bigger money in the tourism sector, and

- large scale farming undercut prices and eroded market share of small farmers.

It doesn’t matter. The facts speak for themselves and this government has badly failed the people economically. Just one of many ways they’ve failed the people. 

[saengd]

4 hours ago, tomacht8 said:

 Transparency, use and control of tax funds is no longer traceable to the public.

Rubbish and nonsense!

 

Revenue publishes details of tax receipts year on year and has done since day one, they are highly visible. Government budgets are also published in several places every year, you only have to read the national newspaper to see what it's in them. Budget deficits and surpluses are also high visible, etc etc. You haven't got the first clue what you're talking about, you've come up with a line that implies hidden corruption without even understanding how the whole system operates.

[JRG23]

9 hours ago, Jonathan Fairfield said:

invest in education and create jobs

Invest in education and create jobs? What and support the development of knowledgable, confident, wealthy people? No chance!!!! There's some tried and trusted methods of controlling the masses (and Thailand is great at all of them). Give 'em cheap liquor; give 'em lottery; give 'em prostitution; don't give 'em education; keep 'em poor. 

 

[saengd]

7 minutes ago, JRG23 said:

Invest in education and create jobs? What and support the development of knowledgable, confident, wealthy people? No chance!!!! 

 

This mornings winner of the troll of the day awards!

[BobbyL]

Thailand needs to invest in education and create jobs in higher-income sectors

 

That goes against Thailand's deeply ingrained process of indoctrination. Generations of citizens left to just, 'know your place and shut up'.

 

There are many people to blame for this, but I know which establishment should take most of the blame.  

[Assurancetourix]

1 hour ago, saengd said:

Rubbish and nonsense!

 

Revenue publishes details of tax receipts year on year and has done since day one, they are highly visible. Government budgets are also published in several places every year, you only have to read the national newspaper to see what it's in them. Budget deficits and surpluses are also high visible, etc etc. You haven't got the first clue what you're talking about, you've come up with a line that implies hidden corruption without even understanding how the whole system operates.

On the other hand, the revenues from the national washing machine are not known.
It is an open secret in Thailand; the billions brewed by the underground economy are in the hands of the thai generals and large groups, the five families, which employ tens of thousands of Burmese, Cambodian and Laotian slaves paid with a slingshot.
All this with the blessing of the one who cannot be named.

[Assurancetourix]

57 minutes ago, saengd said:

This mornings winner of the troll of the day awards!

 

And yet this is also what happens in countries much more developed than Thailand; in Germany or France.
Everything is done to ensure that national education deteriorates as quickly as possible, even entrance exams to prestigious schools are replaced by "assessments".
Race to the bottom in all areas

[RichardColeman]

A few subs for a war that will never happen or help the poor and educate kids ? I think the Thai people got the message and the Junta are now seeing the results

[JustAnotherHun]

As soon as he reads the World Bank's report our General will solve the problem within a week or so - or prove it is fake news

[saengd]

45 minutes ago, Assurancetourix said:

On the other hand, the revenues from the national washing machine are not known.
It is an open secret in Thailand; the billions brewed by the underground economy are in the hands of the thai generals and large groups, the five families, which employ tens of thousands of Burmese, Cambodian and Laotian slaves paid with a slingshot.
All this with the blessing of the one who cannot be named.

I'll have what ever you're imbibing, it must be pretty powerful stuff...but so early in the day, that's not good!

Edited March 6, 2020 by saengd

[Skallywag]

Uncontrolled population growth is the root cause of poverty is many nations around the world.  AI and Robotics performing jobs is increasing, reducing the numbers of people needed in manufacturing.  

 

Education needed of course, start with birth control and family planning, then go from there.

[FarFlungFalang]

3 hours ago, saengd said:

- large scale farming undercut prices and eroded market share of small farmers.

I've noticed the farms in our area are losing that small family look and the bunds that used to hold the water for rice growing are disappearing turning into larger sugar farms.Automation is also arriving doing it's best to make the jobs the farmers went to do in the cities disappear as well.To be self sufficient may well be the only means of survival again unless the wealth is shared.

[hotchilli]

12 hours ago, Jonathan Fairfield said:

Thai poverty rate increases, farm income slides

And the elite prosper !

[mick220675]

Agricultural commodity prices have been dropping for a long time, the government provides little help but the main problem is exports are down.

 

The Thai baht has made Thai products noncompetitive and those at the bottom of the ladder suffer the most.

 

In our village debt levels are crazy high, people have had tractors and cars repossessed and some have lost the family farm. Many from our village have gone to Bangkok for work, but 30% off the Thai workforce are farmers what can they do?

 

Things are slowly returning to the pre-Thaksin days, the rich and powerful should be very pleased.

 

 

[saengd]

8 minutes ago, mick220675 said:

Agricultural commodity prices have been dropping for a long time, the government provides little help but the main problem is exports are down.

 

The Thai baht has made Thai products noncompetitive and those at the bottom of the ladder suffer the most.

 

In our village debt levels are crazy high, people have had tractors and cars repossessed and some have lost the family farm. Many from our village have gone to Bangkok for work, but 30% off the Thai workforce are farmers what can they do?

 

Things are slowly returning to the pre-Thaksin days, the rich and powerful should be very pleased.

 

 

Here's the agricultural export numbers for the past 5 years. https://www.ceicdata.com/en/thailand/exports-by-product-group/exports-agriculture-rubber

[christophe75]

17 minutes ago, mick220675 said:

Things are slowly returning to the pre-Thaksin days, the rich and powerful should be very pleased.

 

I would be even more radical.

 

What we enjoyed during the last 30 years (AKA economic development) was just a... parenthesis. In time.

 

We are going back to "long term" trend. AKA : hardship.

 

What I call the "Great Empoverishment".

 

Someone was talking about France and Germany. This phenomenon is worldwide, indeed.

 

Western countries are just starting from higher. It means the process will take a little more time.

 

As for Thailand, the long term trend was always behind, ready to come back : feudal system.

 

Nothing less, nothing more.

 

The dream of a "middle class" is gone.

 

Now, like from dawns of time, we have only 2 classes : the ruling class, and the... peasants, the slaves.

 

Soon, the little princes and princesses from Bangkok, who thought they'd have it all with their Iphone (bought on credit) and their stupid sxxxty job in airconditioned offices... we'll return to their original... class and world...

 

And it will be painful.

 

"La fête est finie".

 

The party is over.

Edited March 6, 2020 by christophe75

[Yadon Toploy]

12 hours ago, chickenslegs said:

It would be interesting to know how the uber wealthy top 5% fared during the same time period.

My guess is that they did better than ever.

 

A Coup for the Rich.

 

Giles wrote about it years ago. Banned here of course, but I picked up a copy in Singapore.

 

Obvious to many of us.

[chrisandsu]

Do Thais even work in the fields these days? For the most part I only see Cambodians and Burmese .