PM says Thailand must get out of “middle-income” trap in less than 12 years

[JohnnyJazz]

In most countries, middle income financially supports countries!

The elite, large corporations pay no tax.

The poor pay little to no tax.

When did middle income become a trap?

Without it you go back into the dark ages!

In the US, the middle class is all but gone and just look at the quality of life now.

Most of the food banks are empty, food stamp recipients are at an all time high and most income is derived from Social Security, unemployment, welfare and government salaries!

Small business including farming is history.

Read again the OP for Pete's sake ! It's not about middle class or middle income people. Forget about the "middle", it's about countries relying on cheap labour.

I don't know what is the worse, the Nation's poor translation or the posters' poor reading skill.

[tonbridgebrit]

I think the junta is simply not talking about low income Thais and middle-income Thais !

I think the general is trying to say that Thailand (as a nation) is a middle-income nation. And that there are high income (technology) countries that Thailand might not be able to compete against, and that Thailand won't be able to compete against the low-income countries (the low-income countries have cheaper labour than Thailand).

Thailand has still got far cheaper labour than America and Europe, and that's why, I think, Thailand will continue to draw in foreign companies setting up and expanding their factories. I think there's no need for Thailand to worry about those foreign companies turning up in neighbouring countries instead, because nobody in their right mind is going to open a big factory in Burma or Cambodia if they can do it in Thailand. How many foreign companies have opened up factories in Burma, Cambodia and Laos during the last two or three decades ? I think very few.

And this new ASEAN thing in 2015. We're simply not going to see any massive new changes, the system is only going to be changed slightly. ASEAN 2015 is simply not going to cause a mass exit of capital from Thailand, and a mass flood of capital going into Burma. Can anybody imagine a flood of Chinese and American companies going into Burma from next year onwards ? What about European and Japanese companies ? Off-course not.

[Kabula]

In most countries, middle income financially supports countries!

The elite, large corporations pay no tax.

The poor pay little to no tax.

When did middle income become a trap?

Without it you go back into the dark ages!

In the US, the middle class is all but gone and just look at the quality of life now.

Most of the food banks are empty, food stamp recipients are at an all time high and most income is derived from Social Security, unemployment, welfare and government salaries!

Small business including farming is history.

Read again the OP for Pete's sake ! It's not about middle class or middle income people. Forget about the "middle", it's about countries relying on cheap labour.

I don't know what is the worse, the Nation's poor translation or the posters' poor reading skill.

Countries with a strong middle income don't have to compete with other countries as if their economy is strong, cheap labor will always seek them out. Thailand will always have cheap labor.

What builds a strong middle income, is less restrictions, less tax, encouraging moms and pops to start a small business, and less control. The less fortunate run to the mom and pops, and grow with them to build a vibrant economy.

The once rich countries that think like you, will eventually be poor, (the transfer of wealth) and it's citizens will run to the country that is healthy and financially stable with growth and happy, well fed citizens. Many of them are there now with the once middle class working at fast food restaurants if they have a college education!

If you have not noticed, the rich countries are in deep financial trouble as the middle class has been crushed. Of course the main stream media forgets to mention that.

Also, with all the new rules here, the mom and pop retail sales, and food stalls are disappearing, along with aliens, and tourists! The middle class restaurants, retail stores and tourist services are scared.

Think it will get better? Think again.

To break through the financial illusion one must illustrate the importance if the middle class! Without a middle class you are a slave!

Bullies are so annoying.

[Publicus]

Hold on, hold, wait a minute.

Is Thailand trying to shift all it's low income people into being middle income people ?

Surely, in any society, you're always going to need to have people who are going to sweep the streets, collect rubbish (garbage or 'refuse' collectors), and do a whole mass of un-skilled and semi-skilled labour. You'ill always need women working in bars and other night time places.

You can't really shift everybody into middle-income, and have hardly anybody in low income.

See, all this bringing in labour from Cambodia, Laos and Burma. And also Vietnam, let the Vietnamese in as well. Thailand has been doing this for decades. What is it all about ? Is Thailand trying to bring in all that cheap foreign labour, because it wants all those foreign 'peasants' to be the new low-income people ? That way, all the Thais can become middle-income people and high-income people ?

Actually, in America, are the Americans importing loads of Mexicans, that way, all the Americans can become middle-class ?

And in Europe, all this bringing in cheap labour from Romania, Poland and Bulgaria. And indeed, bring in cheap labour from outside of Europe. Is all this being done, so the new foreigners become the new low-income people ?

I really do wonder as to what is actually going on. I think the junta, when they was talking about low and middle-income, they meant Thailand as a nation, not actual individual people. But still, bringing in Cambodians and Laos people. Is it because those foreigners are suppose to be the new low-income people ??

It is true what the general says. Thailand will lose its competitive edge before Thailand reaches real wealth enough to call itself developed.

This is basically their own fault because while Singapore and Korea was trying to swat corruption and educate their people , Thailand was doing completely the opposite.

They might have shot their own goose.

Agreed and then some due to several principal factors I consider to be significant.

First and foremost, Singapore and S Korea had strong long term leaders - Lee Kwan You and Park Chung Hee respectively - who provided effective everyday secular leadership as head of government. During the long rule of each, he had real power, complete authority, vision, and applied them. Each was a practical head of state and head of government who approached the country's problems realistically, scientifically, pragmatically.

Secondly each attached himself and thus the country to a powerful patron and mentor, specifically, the United States. Each Lee in Singapore and Park in Seoul listened and learned, taking U.S. systems of economics and finance to apply them locally. Neither got tangled up by a nebulous Singapore way or a (South) Korean way. The way to each leader was the way that was the most objectively effective way.

Each constructed a diamond shaped socio-economic society which is characterized by a large middle class and opposite poles where few are filthy rich or dirt poor. Each leader was in large part able to do this because neither country had a historical mass of rural poor to incorporate into the society. Agriculture is not a factor in Singapore, and it is of minimal consequence to S. Korea because almost 2/3rds of the land consists of solid rock mountains.

In Korea the huge middle class demanded and got political power and freedoms that led to successful public and civic groups breaking the cycle of corruption in significant and long lasting ways. At election time the newly middle class Korean parents and their civil society allies published full pages of newspaper notices containing individual photos of politicians at all levels of government with the caption "This man is corrupt" under each photo. Each election the number of full pages of photos decreased to the present circumstance that no politician wants to be among a remaining dirty dozen or so of published mug shots.

And education, education, education.

In S Korea I taught successively in two government schools with two opposite Korean co-teachers. At a middle school my Korean co-teacher was in his 50s and went through each day with his eyes closed. He did the same things each day in the same places in the same ways. At the other school, a sprawling new multi building technical high school, my Korean co-teacher was a restless guy in his late 20s who I'm certain slept with his eyes open. He urged his students to challenge the status quo in everything at all times in every way, in education especially. He was direct: He told his students he wanted a continuing alliance with them for reform and that down the road he wanted them as parents to step forward to support him to implement radical change as an education administrator.

Woe is Thailand.

[tonbridgebrit]

Hold on, hold, wait a minute.

Is Thailand trying to shift all it's low income people into being middle income people ?

Surely, in any society, you're always going to need to have people who are going to sweep the streets, collect rubbish (garbage or 'refuse' collectors), and do a whole mass of un-skilled and semi-skilled labour. You'ill always need women working in bars and other night time places.

You can't really shift everybody into middle-income, and have hardly anybody in low income.

See, all this bringing in labour from Cambodia, Laos and Burma. And also Vietnam, let the Vietnamese in as well. Thailand has been doing this for decades. What is it all about ? Is Thailand trying to bring in all that cheap foreign labour, because it wants all those foreign 'peasants' to be the new low-income people ? That way, all the Thais can become middle-income people and high-income people ?

Actually, in America, are the Americans importing loads of Mexicans, that way, all the Americans can become middle-class ?

And in Europe, all this bringing in cheap labour from Romania, Poland and Bulgaria. And indeed, bring in cheap labour from outside of Europe. Is all this being done, so the new foreigners become the new low-income people ?

I really do wonder as to what is actually going on. I think the junta, when they was talking about low and middle-income, they meant Thailand as a nation, not actual individual people. But still, bringing in Cambodians and Laos people. Is it because those foreigners are suppose to be the new low-income people ??

It is true what the general says. Thailand will lose its competitive edge before Thailand reaches real wealth enough to call itself developed.

This is basically their own fault because while Singapore and Korea was trying to swat corruption and educate their people , Thailand was doing completely the opposite.

They might have shot their own goose.

Agreed and then some due to several principal factors I consider to be significant.

First and foremost, Singapore and S Korea had strong long term leaders - Lee Kwan You and Park Chung Hee respectively - who provided effective everyday secular leadership as head of government. During the long rule of each, he had real power, complete authority, vision, and applied them. Each was a practical head of state and head of government who approached the country's problems realistically, scientifically, pragmatically.

Secondly each attached himself and thus the country to a powerful patron and mentor, specifically, the United States. Each Lee in Singapore and Park in Seoul listened and learned, taking U.S. systems of economics and finance to apply them locally. Neither got tangled up by a nebulous Singapore way or a (South) Korean way. The way to each leader was the way that was the most objectively effective way.

Each constructed a diamond shaped socio-economic society which is characterized by a large middle class and opposite poles where few are filthy rich or dirt poor. Each leader was in large part able to do this because neither country had a historical mass of rural poor to incorporate into the society. Agriculture is not a factor in Singapore, and it is of minimal consequence to S. Korea because almost 2/3rds of the land consists of solid rock mountains.

In Korea the huge middle class demanded and got political power and freedoms that led to successful public and civic groups breaking the cycle of corruption in significant and long lasting ways. At election time the newly middle class Korean parents and their civil society allies published full pages of newspaper notices containing individual photos of politicians at all levels of government with the caption "This man is corrupt" under each photo. Each election the number of full pages of photos decreased to the present circumstance that no politician wants to be among a remaining dirty dozen or so of published mug shots.

And education, education, education.

In S Korea I taught successively in two government schools with two opposite Korean co-teachers. At a middle school my Korean co-teacher was in his 50s and went through each day with his eyes closed. He did the same things each day in the same places in the same ways. At the other school, a sprawling new multi building technical high school, my Korean co-teacher was a restless guy in his late 20s who I'm certain slept with his eyes open. He urged his students to challenge the status quo in everything at all times in every way, in education especially. He was direct: He told his students he wanted a continuing alliance with them for reform and that down the road he wanted them as parents to step forward to support him to implement radical change as an education administrator.

Woe is Thailand.

Publicus, thank you for your comment.

Okay, do you feel though, that we're not actually going to see mass re-location of factories from Thailand to Thailand's neighbours ? There are a whole host of problems regarding opening factories in Burma and Cambodia, the same reasons as to why Thailand has received the lion's share of foreign investment in South East Asia during the last few decades.

About trying to catch up with Singapore and Korea. We're talking skills and technology at work. As Thailand 'educates itself', well, Singapore is not standing still, Singapore is also improving it's own skills. Singapore will simply not allow itself to be replaced, Singapore will/is going to carry on being "top of the class" ?? Nobody is going to replace Singapore (and also that technology corridor in Malaysia) as a technology sector ! Do you agree ?

And also, so Thailand is sandwiched between the high-income countries (like Singapore) and the low-income countries (Burma, Cambodia, Laos). In all honesty, what's so bad about carrying on being between those two groups ? Yes, Thai at Heart, you say 'whoopee' about how Thailand is ahead of Laos ! Well, lets add Burma and Cambodia to Laos.

So Thailand will stay ahead of those countries. Most things are relative, you're only good-looking if you look good compared to others, you're only successful because you're more successful than others ! No need for Thailand to worry about the future as far as the economy is concerned.

[Thai at Heart]

Hold on, hold, wait a minute.

Is Thailand trying to shift all it's low income people into being middle income people ?

Surely, in any society, you're always going to need to have people who are going to sweep the streets, collect rubbish (garbage or 'refuse' collectors), and do a whole mass of un-skilled and semi-skilled labour. You'ill always need women working in bars and other night time places.

You can't really shift everybody into middle-income, and have hardly anybody in low income.

See, all this bringing in labour from Cambodia, Laos and Burma. And also Vietnam, let the Vietnamese in as well. Thailand has been doing this for decades. What is it all about ? Is Thailand trying to bring in all that cheap foreign labour, because it wants all those foreign 'peasants' to be the new low-income people ? That way, all the Thais can become middle-income people and high-income people ?

Actually, in America, are the Americans importing loads of Mexicans, that way, all the Americans can become middle-class ?

And in Europe, all this bringing in cheap labour from Romania, Poland and Bulgaria. And indeed, bring in cheap labour from outside of Europe. Is all this being done, so the new foreigners become the new low-income people ?

I really do wonder as to what is actually going on. I think the junta, when they was talking about low and middle-income, they meant Thailand as a nation, not actual individual people. But still, bringing in Cambodians and Laos people. Is it because those foreigners are suppose to be the new low-income people ??

It is true what the general says. Thailand will lose its competitive edge before Thailand reaches real wealth enough to call itself developed.

This is basically their own fault because while Singapore and Korea was trying to swat corruption and educate their people , Thailand was doing completely the opposite.

They might have shot their own goose.

Agreed and then some due to several principal factors I consider to be significant.

First and foremost, Singapore and S Korea had strong long term leaders - Lee Kwan You and Park Chung Hee respectively - who provided effective everyday secular leadership as head of government. During the long rule of each, he had real power, complete authority, vision, and applied them. Each was a practical head of state and head of government who approached the country's problems realistically, scientifically, pragmatically.

Secondly each attached himself and thus the country to a powerful patron and mentor, specifically, the United States. Each Lee in Singapore and Park in Seoul listened and learned, taking U.S. systems of economics and finance to apply them locally. Neither got tangled up by a nebulous Singapore way or a (South) Korean way. The way to each leader was the way that was the most objectively effective way.

Each constructed a diamond shaped socio-economic society which is characterized by a large middle class and opposite poles where few are filthy rich or dirt poor. Each leader was in large part able to do this because neither country had a historical mass of rural poor to incorporate into the society. Agriculture is not a factor in Singapore, and it is of minimal consequence to S. Korea because almost 2/3rds of the land consists of solid rock mountains.

In Korea the huge middle class demanded and got political power and freedoms that led to successful public and civic groups breaking the cycle of corruption in significant and long lasting ways. At election time the newly middle class Korean parents and their civil society allies published full pages of newspaper notices containing individual photos of politicians at all levels of government with the caption "This man is corrupt" under each photo. Each election the number of full pages of photos decreased to the present circumstance that no politician wants to be among a remaining dirty dozen or so of published mug shots.

And education, education, education.

In S Korea I taught successively in two government schools with two opposite Korean co-teachers. At a middle school my Korean co-teacher was in his 50s and went through each day with his eyes closed. He did the same things each day in the same places in the same ways. At the other school, a sprawling new multi building technical high school, my Korean co-teacher was a restless guy in his late 20s who I'm certain slept with his eyes open. He urged his students to challenge the status quo in everything at all times in every way, in education especially. He was direct: He told his students he wanted a continuing alliance with them for reform and that down the road he wanted them as parents to step forward to support him to implement radical change as an education administrator.

Woe is Thailand.

Publicus, thank you for your comment.

Okay, do you feel though, that we're not actually going to see mass re-location of factories from Thailand to Thailand's neighbours ? There are a whole host of problems regarding opening factories in Burma and Cambodia, the same reasons as to why Thailand has received the lion's share of foreign investment in South East Asia during the last few decades.

About trying to catch up with Singapore and Korea. We're talking skills and technology at work. As Thailand 'educates itself', well, Singapore is not standing still, Singapore is also improving it's own skills. Singapore will simply not allow itself to be replaced, Singapore will/is going to carry on being "top of the class" ?? Nobody is going to replace Singapore (and also that technology corridor in Malaysia) as a technology sector ! Do you agree ?

And also, so Thailand is sandwiched between the high-income countries (like Singapore) and the low-income countries (Burma, Cambodia, Laos). In all honesty, what's so bad about carrying on being between those two groups ? Yes, Thai at Heart, you say 'whoopee' about how Thailand is ahead of Laos ! Well, lets add Burma and Cambodia to Laos.

So Thailand will stay ahead of those countries. Most things are relative, you're only good-looking if you look good compared to others, you're only successful because you're more successful than others ! No need for Thailand to worry about the future as far as the economy is concerned.

Staying ahead is not enough. Thailand needs to move and not.concern itself with beating its neighbours but to stand on its own true merits.

The car industry in Thailand took 15 years to build. It took vision from Thailand and Japan. Where is the next major step?

Nowhere yet I think. So when investors are looking at their investment plan, it isn't about what is here already moving, it is about attracting the new stuff.

Thailand no longer gets 100% of regional investments. A portion goes to its neighbours. And this will increase until Thailand comes up with its next piece of vision.

[hhinhh]

This guy seems to really have a good head on his shoulders which is more than can be said for 95% of this countries politicians. I know it will take time to build a body of work on which to judge him properly but for once I see some hope for Thailand's socio/political/economic future. Let's hope he is the real deal. Keeping my fingers crossed!

While I too am keeping my fingers crossed, I cannot but wonder what is going to happen in 18 months or so, when real elections are held. I fear it will be back to business as usual at that point. Does anyone really think that Thaksin is finished yet? The PTP (or whatever they get reincarnated as) will field the same tired old faces. Probably the Democrats too.

Perhaps he can be the head of a new party and if he continues to do his job well he could be the solution leaving of the previous foul parties behind in next election.

[tbthailand]

PM says Thailand must get out of “middle-income” trap in less than 12 years

let's try to focus on Thai-style democracy first, Herr Prime Minister.

[Eric Loh]

Good vision. Looking forward to see the new cabinet and the NLA put more details so the citizens will be able to understand and buy into the the vision. If we take the World Bank high income defination, it will mean moving up per capital from current USD5,250 to USD12,500. To do that Thailand have to increase her national income. GDP will have to increase quite dramatically.

Details should have what value of GDP aimed to reach in 12 years and what GDP growth each year to arrive to a high income status of a per capital USD12,500. For example, Malaysia 2020 vision asked for a eight fold increase of GDP from 1990 when the vision first hatched and that required 7% GDP growth each year.

It also require preceding governments to maintain the initiatives and work within a framework to reach the target in 12 years time. That may be its undoing.

[Stradavarius37]

"...talk in everlasting words and dedicate them all to me..." Come back in 12 months.

I would love it if you came back in 12 months skunky.

[me313]

Erosion of the middle class will ensure prosperity for foreign investors like those clapping hands above--it will mean more struggling Thai people will not get included in this prosperity package, because to keep Thailand "competitive" there has to be a low-wage workforce to compete with these other countries like Myanmar, which will be chosen as the cheapest or near cheapest investment center in the near future--so scary to those who want to continue to get such cheap labor and have such huge profit off their Thai workforce. The opposition to labor laws and security for middle income earners is conveniently gone, no opposition, and policies to protect investors who want a rich-poor divide will continue to attract foreign investment into Thailand. The war against the Middle Class is raging in many countries. The destruction of the middle class is part of the economic structure necessary to keep, or retain, a lot of powerlessness in the workers who have almost no voice, as those in the North who are angry but can do nothing about it. They understand what is at stake, those reading this forum are thrilled that a policy is making foreign investors more at ease in continuing to get this abundance of cheap labor instead of looking to neighboring even more desperate and destitute countries--like Myanmar, for their future huge corporate profit off what really is slave labor, creating sustainable huge billion or million dollar profits for the wealthy investors.

Edited August 31, 2014 by me313

[wilcopops]

Erosion of the middle class will ensure prosperity for foreign investors like those clapping hands above--it will mean more struggling Thai people will not get included in this prosperity package, because to keep Thailand "competitive" there has to be a low-wage workforce to compete with these other countries like Myanmar, which will be chosen as the cheapest or near cheapest investment center in the near future--so scary to those who want to continue to get such cheap labor and have such huge profit off their Thai workforce. The opposition to labor laws and security for middle income earners is conveniently gone, no opposition, and policies to protect investors who want a rich-poor divide will continue to attract foreign investment into Thailand. The war against the Middle Class is raging in many countries. The destruction of the middle class is part of the economic structure necessary to keep, or retain, a lot of powerlessness in the workers who have almost no voice, as those in the North who are angry but can do nothing about it. They understand what is at stake, those reading this forum are thrilled that a policy is making foreign investors more at ease in continuing to get this abundance of cheap labor instead of looking to neighboring even more desperate and destitute countries--like Myanmar, for their future huge corporate profit off what really is slave labor, creating sustainable huge billion or million dollar profits for the wealthy investors.

" Erosion of the middle class" This is tangential to the "middle income gap" - middle income refers to the nation not the population or class structure in particular.

[wilcopops]

there seem to be several people on this thread who don't know what "middle income gap" means.

here's the wiki definition. - note it has little to do with "middle class"

"As wages rise, manufacturers often find themselves unable to compete in export markets with lower-cost producers elsewhere. Yet, they still find themselves behind the advanced economies in higher-value products. This is the middle-income trap" - wiki.

​In fact it is the growth of a middle-class and a functioning democratic system that is most likely to get a country out of this predicament. (just writing a constitution will not work)

[Publicus]

It is true what the general says. Thailand will lose its competitive edge before Thailand reaches real wealth enough to call itself developed.

This is basically their own fault because while Singapore and Korea was trying to swat corruption and educate their people , Thailand was doing completely the opposite.

They might have shot their own goose.

Agreed and then some due to several principal factors I consider to be significant.

First and foremost, Singapore and S Korea had strong long term leaders - Lee Kwan You and Park Chung Hee respectively - who provided effective everyday secular leadership as head of government. During the long rule of each, he had real power, complete authority, vision, and applied them. Each was a practical head of state and head of government who approached the country's problems realistically, scientifically, pragmatically.

Secondly each attached himself and thus the country to a powerful patron and mentor, specifically, the United States. Each Lee in Singapore and Park in Seoul listened and learned, taking U.S. systems of economics and finance to apply them locally. Neither got tangled up by a nebulous Singapore way or a (South) Korean way. The way to each leader was the way that was the most objectively effective way.

Each constructed a diamond shaped socio-economic society which is characterized by a large middle class and opposite poles where few are filthy rich or dirt poor. Each leader was in large part able to do this because neither country had a historical mass of rural poor to incorporate into the society. Agriculture is not a factor in Singapore, and it is of minimal consequence to S. Korea because almost 2/3rds of the land consists of solid rock mountains.

In Korea the huge middle class demanded and got political power and freedoms that led to successful public and civic groups breaking the cycle of corruption in significant and long lasting ways. At election time the newly middle class Korean parents and their civil society allies published full pages of newspaper notices containing individual photos of politicians at all levels of government with the caption "This man is corrupt" under each photo. Each election the number of full pages of photos decreased to the present circumstance that no politician wants to be among a remaining dirty dozen or so of published mug shots.

And education, education, education.

In S Korea I taught successively in two government schools with two opposite Korean co-teachers. At a middle school my Korean co-teacher was in his 50s and went through each day with his eyes closed. He did the same things each day in the same places in the same ways. At the other school, a sprawling new multi building technical high school, my Korean co-teacher was a restless guy in his late 20s who I'm certain slept with his eyes open. He urged his students to challenge the status quo in everything at all times in every way, in education especially. He was direct: He told his students he wanted a continuing alliance with them for reform and that down the road he wanted them as parents to step forward to support him to implement radical change as an education administrator.

Woe is Thailand.

Publicus, thank you for your comment.

Okay, do you feel though, that we're not actually going to see mass re-location of factories from Thailand to Thailand's neighbours ? There are a whole host of problems regarding opening factories in Burma and Cambodia, the same reasons as to why Thailand has received the lion's share of foreign investment in South East Asia during the last few decades.

About trying to catch up with Singapore and Korea. We're talking skills and technology at work. As Thailand 'educates itself', well, Singapore is not standing still, Singapore is also improving it's own skills. Singapore will simply not allow itself to be replaced, Singapore will/is going to carry on being "top of the class" ?? Nobody is going to replace Singapore (and also that technology corridor in Malaysia) as a technology sector ! Do you agree ?

And also, so Thailand is sandwiched between the high-income countries (like Singapore) and the low-income countries (Burma, Cambodia, Laos). In all honesty, what's so bad about carrying on being between those two groups ? Yes, Thai at Heart, you say 'whoopee' about how Thailand is ahead of Laos ! Well, lets add Burma and Cambodia to Laos.

So Thailand will stay ahead of those countries. Most things are relative, you're only good-looking if you look good compared to others, you're only successful because you're more successful than others ! No need for Thailand to worry about the future as far as the economy is concerned.

Staying ahead is not enough. Thailand needs to move and not.concern itself with beating its neighbours but to stand on its own true merits.

The car industry in Thailand took 15 years to build. It took vision from Thailand and Japan. Where is the next major step?

Nowhere yet I think. So when investors are looking at their investment plan, it isn't about what is here already moving, it is about attracting the new stuff.

Thailand no longer gets 100% of regional investments. A portion goes to its neighbours. And this will increase until Thailand comes up with its next piece of vision.

It's hard to find the resources in Thailand to get it to rank with Singapore, S Korea or even Malaysia.

Look at the US$ value GDP per capita for the four countries based on PPP for 2013:

1) Singapore $78,744

2) S Korea $33,140

3) Malaysia $23,298

4) Thailand $14,390

Thailand's sad conceit of assigning itself superior status to Cambodia, Laos, Burma/Myanmar would be like Montenegro crowing it's superior to Nepal, Burkina Faso, Ethiopia and their lot. It's absurd to the point that it is laughable.

In fact Thailand's GDP per se is a couple of dozen million bucks behind the GDP of the US state of Massachusetts (Boston) despite the fact Thailand has ten times the population of Massachusetts. And Massachusetts routs Thailand completely in GDP per capita.

Thailand's natural resources alone don't get the former LOS into the upper income league. Neither does Thai technology. Education and thus human resources don't get it there either - it's not even a close call on that account. Central issues such as corruption continue to pull the country back causing the rule of law over the rule of men to remain impossible.

These are just some vital factors in the equation. All of the foregoing and much more keep Thailand bumping up against a ceiling that is both of its own making in respect of its institutions but also due to Nature's treatment of the place. Tourism is a strong plus but neither can it take the country over the hump itself or as a part of the total hash that is Thailand.

I can't think of a single next breakthrough development that itself could propel or lead Thailand out of the middle income trap and into the top tier of prosperous and well governed countries others seek to emulate.

Good discussion though cause it brings forward the core issues and factors that help clarify the reality that is Thailand.

[Brian Corrigan]

This guy seems to really have a good head on his shoulders which is more than can be said for 95% of this countries politicians. I know it will take time to build a body of work on which to judge him properly but for once I see some hope for Thailand's socio/political/economic future. Let's hope he is the real deal. Keeping my fingers crossed!

While I too am keeping my fingers crossed, I cannot but wonder what is going to happen in 18 months or so, when real elections are held. I fear it will be back to business as usual at that point. Does anyone really think that Thaksin is finished yet? The PTP (or whatever they get reincarnated as) will field the same tired old faces. Probably the Democrats too.

Don't worry,by next October the General will have his own political party to contest any possible election. Who could resist voting for him??

[Robespiere]

This guy seems to really have a good head on his shoulders which is more than can be said for 95% of this countries politicians. I know it will take time to build a body of work on which to judge him properly but for once I see some hope for Thailand's socio/political/economic future. Let's hope he is the real deal. Keeping my fingers crossed!

While I too am keeping my fingers crossed, I cannot but wonder what is going to happen in 18 months or so, when real elections are held. I fear it will be back to business as usual at that point. Does anyone really think that Thaksin is finished yet? The PTP (or whatever they get reincarnated as) will field the same tired old faces. Probably the Democrats too.

Don't worry,by next October the General will have his own political party to contest any possible election. Who could resist voting for him??

The 51% - 60% of the electorate who vote Red

[473geo]

Ha ha ha... A play out of Taksin's book. "No poverty in Thailand within X years."

If Thailand's average income is going anywhere it is going to be closer to Bangladesh than to Singapore.

We live on a planet with finite resources, plain and simple.

And poverty is the chariot of corruption

[Publicus]

I finally found out what explains the support of the sexpat (calling a spade a spade) for Thailand old guard : they both rely on cheap labour, desperate people, to support their life style. The message of Gen. Prayuth is clear, this era is over.Thailand to survive as a country needs to get out of this trap.

Prayuth address is not about middle class people but about "middle income country", a country that relies on cheap labour to survive. Thailand need better productivity and a more educated workforce. Now is 12 years a realistic time frame ? When you see how China has changed in the past 12 years the answer may be yes. Just look at Shenzhen a city that didn't exist twenty years ago and is now one of the most vibrant city of China, look at his inhabitants who twenty years ago were peasant and now are sophisticated city dwellers. After a couple of false start lest hope Thailand is now on the right track to become a modern nation.

Citing Shenzhen is encouraging to Thailand yet SZ in the PRChina is much closer to being the city-state that Singapore is than it is to being the nation state that Thailand is.

SZ benefits from factors Thailand does not have, cannot have, not in a million years.

SZ for instance is the original Special Economic Development Zone established by Deng Xiao Peng so it was given an even greater local autonomy than most Chinese cities have had, even given the historical fact Chinese cities have the tradition and expectation of considerable autonomy from the central government. It's the old Chinese saying that "The mountains are high and the emperor is far away."

Such federalism in China, 2000 years of it and necessarily continued by the CCP, allows a flexibility Thailand and its unitary system of governance / rule has never had, never will have. Absent such a flexibility, Thailand could not host a successful project such as SZ. (And the new SZ middle class is busily dismantling one party rule there and corruption to boot so the Boyz of Bangkok would have to be cautious of what they might inadvertently invite in such a project.)

More specifically, Bangkok cannot morph into a SZ and there is no city or place to build on or to create a SZ anywhere in Thailand. SZ is adjacent to Hong Kong and a short ferry foray to Macao. SZ is a marathon distance run from Guangzhou, which is the old Canton, and is a stone's throw from another new and thriving coastal city Zhouhai which abuts Macao,

So the necessarily autonomous SZ is in China's absolutely best neighborhood, to include its most developed province Guangdong (GD. Where to place a SZ in Thailand? Certainly not Raynong. Forget Pattaya. Turn Phuket into an industrial zone? Etc.

Offering SZ to Thailand as inspiration is good and noble but to be meaningful the inspiration also requires perspiration, as in hard work and realism. The politics of SZ suits China but in Thailand would be a square peg in a round hole.

[bushwacker]

The government certainly must know more than me, but from what i have witnessed, it seems the majority of Thais are low income, living in middle or high income styles based on loans. The other grouping is high income. It seems to me if a simple asset/liabilities test were performed by citizen then the country has already escaped from the middle income trap. But unfortunately they are once again in the lower income swamp.

But what do I know.

[SGD]

How many Thais are middle income? where I am there are still many,many Thais working in rice fields and on building sites for 200 baht a day.

Folk up country have less now than 5 years ago since incomes have barely risen but costs have escalated massively. Bt100/200 being offered and accepted in many places.

[Thanet]

Lots of grand promises, and he's starting to sound a bit like a politician. A question that has been asked for several years now. The question is how?

I'd say that Thailand's only option to escape a middle income trap is to go upwards, as to try to lower wages and go back down to competitive production via cheap labour would not be practical for various reasons.

To go upwards. to a fully developed economy would mean:

1) Making Thailand a friendlier place to do business, opening the doors to investment, relaxing immigration requirements to attract skilled foreign workers, cutting red tape, etcetera. No evidence of that yet

2) Educating Thais to be creative lateral thinkers, who question and challenge the norm and in doing so invent. No evidence of that yet, quite the opposite in fact

3) Understanding that calling for a step back in time to an agrarian utopia based on mere self-sufficiency, and the development of a modern technology based economy are opposing mindsets and may not successfully coexist. No evidence of that yet

Talk's cheap, as the old saying goes, Actions speak louder than words, even.

And why the arbitrary 12 years? What's the plan to go from here to there?

Edited August 31, 2014 by Thanet

[Thai at Heart]

It is true what the general says. Thailand will lose its competitive edge before Thailand reaches real wealth enough to call itself developed.

This is basically their own fault because while Singapore and Korea was trying to swat corruption and educate their people , Thailand was doing completely the opposite.

They might have shot their own goose.

Agreed and then some due to several principal factors I consider to be significant.

First and foremost, Singapore and S Korea had strong long term leaders - Lee Kwan You and Park Chung Hee respectively - who provided effective everyday secular leadership as head of government. During the long rule of each, he had real power, complete authority, vision, and applied them. Each was a practical head of state and head of government who approached the country's problems realistically, scientifically, pragmatically.

Secondly each attached himself and thus the country to a powerful patron and mentor, specifically, the United States. Each Lee in Singapore and Park in Seoul listened and learned, taking U.S. systems of economics and finance to apply them locally. Neither got tangled up by a nebulous Singapore way or a (South) Korean way. The way to each leader was the way that was the most objectively effective way.

Each constructed a diamond shaped socio-economic society which is characterized by a large middle class and opposite poles where few are filthy rich or dirt poor. Each leader was in large part able to do this because neither country had a historical mass of rural poor to incorporate into the society. Agriculture is not a factor in Singapore, and it is of minimal consequence to S. Korea because almost 2/3rds of the land consists of solid rock mountains.

In Korea the huge middle class demanded and got political power and freedoms that led to successful public and civic groups breaking the cycle of corruption in significant and long lasting ways. At election time the newly middle class Korean parents and their civil society allies published full pages of newspaper notices containing individual photos of politicians at all levels of government with the caption "This man is corrupt" under each photo. Each election the number of full pages of photos decreased to the present circumstance that no politician wants to be among a remaining dirty dozen or so of published mug shots.

And education, education, education.

In S Korea I taught successively in two government schools with two opposite Korean co-teachers. At a middle school my Korean co-teacher was in his 50s and went through each day with his eyes closed. He did the same things each day in the same places in the same ways. At the other school, a sprawling new multi building technical high school, my Korean co-teacher was a restless guy in his late 20s who I'm certain slept with his eyes open. He urged his students to challenge the status quo in everything at all times in every way, in education especially. He was direct: He told his students he wanted a continuing alliance with them for reform and that down the road he wanted them as parents to step forward to support him to implement radical change as an education administrator.

Woe is Thailand.

Publicus, thank you for your comment.

Okay, do you feel though, that we're not actually going to see mass re-location of factories from Thailand to Thailand's neighbours ? There are a whole host of problems regarding opening factories in Burma and Cambodia, the same reasons as to why Thailand has received the lion's share of foreign investment in South East Asia during the last few decades.

About trying to catch up with Singapore and Korea. We're talking skills and technology at work. As Thailand 'educates itself', well, Singapore is not standing still, Singapore is also improving it's own skills. Singapore will simply not allow itself to be replaced, Singapore will/is going to carry on being "top of the class" ?? Nobody is going to replace Singapore (and also that technology corridor in Malaysia) as a technology sector ! Do you agree ?

And also, so Thailand is sandwiched between the high-income countries (like Singapore) and the low-income countries (Burma, Cambodia, Laos). In all honesty, what's so bad about carrying on being between those two groups ? Yes, Thai at Heart, you say 'whoopee' about how Thailand is ahead of Laos ! Well, lets add Burma and Cambodia to Laos.

So Thailand will stay ahead of those countries. Most things are relative, you're only good-looking if you look good compared to others, you're only successful because you're more successful than others ! No need for Thailand to worry about the future as far as the economy is concerned.

Staying ahead is not enough. Thailand needs to move and not.concern itself with beating its neighbours but to stand on its own true merits.

The car industry in Thailand took 15 years to build. It took vision from Thailand and Japan. Where is the next major step?

Nowhere yet I think. So when investors are looking at their investment plan, it isn't about what is here already moving, it is about attracting the new stuff.

Thailand no longer gets 100% of regional investments. A portion goes to its neighbours. And this will increase until Thailand comes up with its next piece of vision.

It's hard to find the resources in Thailand to get it to rank with Singapore, S Korea or even Malaysia.

Look at the US$ value GDP per capita for the four countries based on PPP for 2013:

1) Singapore $78,744

2) S Korea $33,140

3) Malaysia $23,298

4) Thailand $14,390

Thailand's sad conceit of assigning itself superior status to Cambodia, Laos, Burma/Myanmar would be like Montenegro crowing it's superior to Nepal, Burkina Faso, Ethiopia and their lot. It's absurd to the point that it is laughable.

In fact Thailand's GDP per se is a couple of dozen million bucks behind the GDP of the US state of Massachusetts (Boston) despite the fact Thailand has ten times the population of Massachusetts. And Massachusetts routs Thailand completely in GDP per capita.

Thailand's natural resources alone don't get the former LOS into the upper income league. Neither does Thai technology. Education and thus human resources don't get it there either - it's not even a close call on that account. Central issues such as corruption continue to pull the country back causing the rule of law over the rule of men to remain impossible.

These are just some vital factors in the equation. All of the foregoing and much more keep Thailand bumping up against a ceiling that is both of its own making in respect of its institutions but also due to Nature's treatment of the place. Tourism is a strong plus but neither can it take the country over the hump itself or as a part of the total hash that is Thailand.

I can't think of a single next breakthrough development that itself could propel or lead Thailand out of the middle income trap and into the top tier of prosperous and well governed countries others seek to emulate.

Good discussion though cause it brings forward the core issues and factors that help clarify the reality that is Thailand.

I agree 100%.

Of course its not lost on anyone that Korea and Singapore have ruthlessly competitive education systems. Beggar thy neighbour is such a complete waste of time.

I can't help feeling that the Thai Chinese industrialists want it to stay exactly the way it is.

[northernjohn]

This guy seems to really have a good head on his shoulders which is more than can be said for 95% of this countries politicians. I know it will take time to build a body of work on which to judge him properly but for once I see some hope for Thailand's socio/political/economic future. Let's hope he is the real deal. Keeping my fingers crossed!

While I too am keeping my fingers crossed, I cannot but wonder what is going to happen in 18 months or so, when real elections are held. I fear it will be back to business as usual at that point. Does anyone really think that Thaksin is finished yet? The PTP (or whatever they get reincarnated as) will field the same tired old faces. Probably the Democrats too.

Don't worry,by next October the General will have his own political party to contest any possible election. Who could resist voting for him??

The 51% - 60% of the electorate who vote Red

Actually the % who voted red shirt is unknown. Them along with the PTP amounted to 48% of which no one knows how many were voting for Yingluck and how many for Thaksin.

I hesitate to say what the general will have by next October. With the backing he has now it could be massive or as is bound to happen when it comes to changing contentious issues especially the one's that allow corruption the resistance will mount towards him.

Thaksin has a large payroll including westerners who post on Thai Visa. Now is he willing to keep throwing that money away or not. that will also have a large impact on what happens. Also I believe that many of the red shirts enjoy peace and will no longer choose to follow the leaders who are bent on restoring Thaksin to Thailand as the leader.

Much can happen and come October next year there will still be work to be done.

It is my belief that some of what will have been accomplished will make it a lot harder to practice corruption. All though we know it can never be eradicated completely we know it can be lessoned quite a bit.

Edited August 31, 2014 by northernjohn

[wandasloan]

First decent PM we've had in a long long long time,

You could be right. Or not. But not on this, which only makes him look like a plagiarist. This particular speech about the middle-income trap is a straight steal from Yingluck.

And poverty is the chariot of corruption

Speaking of stealing.... corruption, yes!

What you just wrote deserves to be beaten down and contradicted and exposed every time it is written. If it were true, Thaksin would be the most honest Thai in history and his time as prime minister the most honest in the annals of the country.

Fact is rich people are far more likely to be corrupt in almost all ways including money. You'd think that electing a guy with eleventeen jillion baht would ensure the end of corruption. By your claim, that's what happened, and the Thaksin-Yingluck years with their were enabled, rich cronies were models of honesty. Right? That's what happened by keeping poor people out of government, right?

Please.

.

Edited August 31, 2014 by wandasloan

[Eric Loh]

First decent PM we've had in a long long long time,

You could be right. Or not. But not on this, which only makes him look like a plagiarist. This particular speech about the middle-income trap is a straight steal from Yingluck.

And poverty is the chariot of corruption

Speaking of stealing.... corruption, yes!

What you just wrote deserves to be beaten down and contradicted and exposed every time it is written. If it were true, Thaksin would be the most honest Thai in history and his time as prime minister the most honest in the annals of the country.

Fact is rich people are far more likely to be corrupt in almost all ways including money. You'd think that electing a guy with eleventeen jillion baht would ensure the end of corruption. By your claim, that's what happened, and the Thaksin-Yingluck years with their were enabled, rich cronies were models of honesty. Right? That's what happened by keeping poor people out of government, right?

Please.

.

Straight steal? Yes indeed. Came together with her announcement of an ambitious mega project 'to lift Thailand out of this middle income trap' (23 Jan 2013). Details included the national income by promoting Agro-industry, tourism, service sector and zoning on land use. NESDB concurred and expect Thailand to break out of the middle income trap in 10-12 years. So the good general is just repeating what was said.

[473geo]

First decent PM we've had in a long long long time,

You could be right. Or not. But not on this, which only makes him look like a plagiarist. This particular speech about the middle-income trap is a straight steal from Yingluck.

And poverty is the chariot of corruption

Speaking of stealing.... corruption, yes!

What you just wrote deserves to be beaten down and contradicted and exposed every time it is written. If it were true, Thaksin would be the most honest Thai in history and his time as prime minister the most honest in the annals of the country.

Fact is rich people are far more likley to be corrupt in almost all ways including money. You'd think that electing a guy with eleventeen jillion baht would ensure the end of corruption. By your claim, that's what happened, and the Thaksin-Yingluck years with their were enabled, rich cronies were models of honesty. Right? That's what happened by keeping poor people out of government, right?

Please.

.

Poverty = desperation = opportunity to manipulate including financial incentive - by the rich..............I don't expect you to understand....no worries

[Thanet]

First decent PM we've had in a long long long time,

You could be right. Or not. But not on this, which only makes him look like a plagiarist. This particular speech about the middle-income trap is a straight steal from Yingluck.

And poverty is the chariot of corruption

Speaking of stealing.... corruption, yes!

What you just wrote deserves to be beaten down and contradicted and exposed every time it is written. If it were true, Thaksin would be the most honest Thai in history and his time as prime minister the most honest in the annals of the country.

Fact is rich people are far more likely to be corrupt in almost all ways including money. You'd think that electing a guy with eleventeen jillion baht would ensure the end of corruption. By your claim, that's what happened, and the Thaksin-Yingluck years with their were enabled, rich cronies were models of honesty. Right? That's what happened by keeping poor people out of government, right?

Please.

.

Straight steal? Yes indeed. Came together with her announcement of an ambitious mega project 'to lift Thailand out of this middle income trap' (23 Jan 2013). Details included the national income by promoting Agro-industry, tourism, service sector and zoning on land use. NESDB concurred and expect Thailand to break out of the middle income trap in 10-12 years. So the good general is just repeating what was said.

You know what they say about imitation being the sincerest form of flattery

[Thai at Heart]

First decent PM we've had in a long long long time,

You could be right. Or not. But not on this, which only makes him look like a plagiarist. This particular speech about the middle-income trap is a straight steal from Yingluck.

And poverty is the chariot of corruption

Speaking of stealing.... corruption, yes!

What you just wrote deserves to be beaten down and contradicted and exposed every time it is written. If it were true, Thaksin would be the most honest Thai in history and his time as prime minister the most honest in the annals of the country.

Fact is rich people are far more likely to be corrupt in almost all ways including money. You'd think that electing a guy with eleventeen jillion baht would ensure the end of corruption. By your claim, that's what happened, and the Thaksin-Yingluck years with their were enabled, rich cronies were models of honesty. Right? That's what happened by keeping poor people out of government, right?

Please.

.

Straight steal? Yes indeed. Came together with her announcement of an ambitious mega project 'to lift Thailand out of this middle income trap' (23 Jan 2013). Details included the national income by promoting Agro-industry, tourism, service sector and zoning on land use. NESDB concurred and expect Thailand to break out of the middle income trap in 10-12 years. So the good general is just repeating what was said.

You know what they say about imitation being the sincerest form of flattery

Well he is doing a fine job of imitation with plans for the rubber industry.

I hope he comes up with some real reforms. The inheritance and land tax is a start and there is no way any political party would have dared to do that. So that is something way beyond the traditional.

But that is just the first of literally hundreds of issues that need to be tackled. 1 down ......

[DrTuner]

The factor that makes other countries more competitive ? High quality immigrants. Complete opposite of the nationalistic policies coming up.

[Thai at Heart]

The factor that makes other countries more competitive ? High quality immigrants. Complete opposite of the nationalistic policies coming up.

Hardly an issue in the success of south Korea are they. Nor Japan. Singapore yes, but then Singapore posed itself as a haven for foreign investment.

Thailand had got itself into a neither fish nor fowl position.