Thailand Economic Development

Question 1

Did the Thai Make a successful transition to EOI, and when

Answer 1

1980s

Question 2

What was the Thai economy most reliant on, which led to the AFC

Answer 2

Foreign capital

Question 3

What is the average GDP growth rate of Thailand from 1961 to 2001

Answer 3

6.8%

Question 4

Did the high frequency of coups significantly impact the Thai economy, and why?

Answer 4

No significant impact, military coups and governments had same commitment to market economy, monarchy helped minimise national conflicts

Question 5

What was the context of economic growth in the 1910s to 1930s (2)

Answer 5

Growth in rice frontier (led by Chinese) and autonomous bourgeoisie (middle class)

Question 6

What was the context of economic development from 1930s to 1950s (2)

Answer 6

• 1932 revolution
• state led development

Question 7

What characterised the state led development from the 1940s to 50s after the 1932 revolution (consider private or public and state led)

Answer 7

• uncoordinated state investments
• state enterprises
• public companies

Question 8

What was the context behind economic development in the 1950s to 1980s

Answer 8

US pressure and private investment

Question 9

Who overthrew phibun in a military coup, and in which year

Answer 9

Sarit, 1957

Question 10

What characterised the development and ISI phase of the economy under Sarit (consider infrastructure)

Answer 10

• systematic state infrastructural role
• investment promotion
• infrastructure development

Question 11

What characterised economic development from 1986 onwards (2)

Answer 11

• rising oil prices
• fall in agricultural prices

Question 12

When did Thailand transition into EOI

Answer 12

1985

Question 13

What was the ideal promoted by phibun after the 1932 revolution

Answer 13

“Thai economy for the Thai people”

Question 14

What allowed the Chinese business class to be so active in the Thai economy before WW2 (3)

Answer 14

• Absence of western domination
• formation of trade associations
• petitioned government for business rights against western privileges and imports

Question 15

What did phibun mean (which groups was he targeting) by driving out “foreign” influences in the economy - 2 groups

Answer 15

1. Westerners
2. Chinese

Question 16

Outline phibun’s approach to economic development after the 1932 revolution (state vs private, what goods were prioritised)

Answer 16

• State led industries
• focus on export of primary products

Question 17

What were the primary products for export under phibun, and what percentage of Thai exports did they account for during phibun’s time 9its a range)

Answer 17

Rice, teak, rubber, tin, 50-90%

Question 18

How many state and public companies were started by 1945

Answer 18

30

Question 19

What 3 instances outlined the involvement of state enterprises and public companies during phibun’s government

Answer 19

1. Ministry of defence set up cotton mill and paper mill
2. Ministry of economic affairs established an industrial division and invested into sugar factories
3. TRC (Thai rice company) - allowed farmers to sell rice to TRC for export

Question 20

What time period was phibun’s state led development

Answer 20

1947-57

Question 21

How was economic nationalism achieved under phibun

Answer 21

• anti-Chinese policies
• 1952 government directive to centralised gold trading, jewellery trading, banking

Question 22

Did the Chinese still hold a significant influence under sarit’s rule, and why

Answer 22

Yes, semi-governmental monopolies were still mostly joint ventures with Chinese businessmen

Question 23

What was the cornerstone of sarit’s political legitimacy

Answer 23

Economic development

Question 24

What role did the government play during sarit’s rule (direct or indirect)

Question 25

What were the 3 areas that sarit’s government would focus development on

Answer 25

1. Infrastructure 2. Administration 3. Planning machinery

Question 26

Which people did Sarit appoint to take charge of economic policy

Answer 26

Technocrats (advocates of technology)

Question 27

What were the 3 focuses of sarit’s rule

Answer 27

1. Agriculture (comparative advantage) 2. Foreign investment and aid 3. State infrastructural role

Question 28

How much did irrigation land increase from 1947 to 1969 (multiple)

Answer 28

3x

Question 29

Between 1950 to 1980, by how much did agricultural holdings increase by under Sarit (Percentage)

Answer 29

2x

Question 30

How much aid and loans did Thailand receive from the US

Answer 30

900 million

Question 31

In what main way did Thailand benefit from the US

Answer 31

US entry into Vietnam war - economic, technological, military aid

Question 32

Did domestic capital maintain dominance in Thailand during sarit’s rule even after foreign investment and aid?

Answer 32

Yes

Question 33

From 1964 to 72, what percentage of total capital formation was supplied by foreign capital

Answer 33

12%

Question 34

When was the promotion of investment act established

Answer 34

1960

Question 35

When was the first Development Plan (hint: 5 years)

Answer 35

1961 - 66

Question 36

When was the IFCT established, and what role did it serve

Answer 36

Industrial finance corporation of Thailand; 1959 - encourage and provide loans for expansion of private industrial enterprises

Question 37

When was the national economic and social development board (NESDB) established and what role did it serve

Answer 37

1959, national economic planning (recording national income statistics)

Question 38

Which national economic and social development plan marked the switch form ISI to EOI, and when was it implemented

Answer 38

4th, 1977-81

Question 39

What were the positive indicators of sarit’s policies (2)

Answer 39

- increase in foreign investments - rapid industrial growth during ISI (1960s) - seen in decreasing reliance on agriculture

Question 40

What is the meaning of Kanphattana, and what was its significance (consider which aspect Sarit tied economic development to when using this ideology

Answer 40

Development, tied economic development with national unity

Question 41

In what way was crony capitalism evident in Thailand during sarit’s rule

Answer 41

- state over-protectionism, esp in the banking industry

Question 42

Which bank, during sarit’s rule, represented 1/3 of the entire Thai banking sector, and financed 42% of all exports

Answer 42

Bangkok bank

Question 43

What were the 3 economic pressures that Thailand faced in the 1970s that led to the formation of the 4th national economic and social development plan (hint: one is from paper 1 and one is to do with the US and Vietnam war, one is to do with one of the 3 goals of economic development)

Answer 43

1. Oil prices 2. Withdrawal of US from the region 3. Widening income gap between urban and rural areas

Question 44

Which 2 aims (of the 3 aims of economic development) did the 4th national economic and social development plan seek to promote

Answer 44

Economic growth and equity

Question 45

Which 2 events/trends pressured the Thai government to seek out more loans in the 1980s

Answer 45

- decline in agricultural commodity prices - second oil crisis

Question 46

What percentage of GDP was comprised of foreign debt in 1986

Answer 46

38%

Question 47

What were 3 reforms carried out in the 1980s to encourage exports

Answer 47

- abolition of several export taxes in 1985 - special credit facilities for exporters by bank of Thailand - overseas firms encouraged to have 100% foreign ownership so long as they exported all or most of output

Question 48

How much FDI per annum did Thailand attract in 1990-96

Answer 48

2 billion per annum

Question 49

In support of the new export oriented focus in their switch to EOI, what did the Thai government do with regards to the Thai currency, and why did they do this

Answer 49

- pegged to USD at a fixed, LOW rate - stability and export competitiveness

Question 50

When did the USD start appreciating (which time frame/period) that impacted the Thai baht as well

Answer 50

1978-85

Question 51

What did the Thai government do in 1981 and 1984 as a result of the USD appreciating

Answer 51

1981: devalued the baht 1984: pegged to a basket of major currencies

Question 52

What 2 considerations should be made when considering the appreciation/depreciation of the Thai baht and its impact on economic growth

Answer 52

- exports - production costs (labour)

Question 53

What was the main focus of the 6th economic development plan

Answer 53

Scaling down of the government’s role

Question 54

When was the 6th economic and social development plan implemented

Answer 54

1987

Question 55

What was the growth rate of Thai exports in the 1980s

Answer 55

14%

Question 56

From what percent to what percent did the share of manufacturing contribute to Thai’s GDP from 1952 to 2000

Answer 56

16% to 34%

Question 57

The Gini coefficient of Thailand rose from what to what from 1965 to 2000

Answer 57

0.40 to 0.5 (approx)

Question 58

Limitations to government strategies overall (6)

Answer 58

1. Income and urban-rural inequality 2. Concentration of wealth by large banks and firms 3. Growing debt and deficits 4. Over protectionism, inefficiency, loss of international competitiveness 5. Financial liberalisation without supervisory and regulatory capacities 6. Political paralysis

Question 59

Of the over 70 leading business groups I the early 1980s, how many were non-ethnic Chinese groups

Answer 59

3

Question 60

When did Thailand export growth rate slow to 0%, and from by how many percent did it fall by

Answer 60

Mid 1990s, fell from 28% from 1986 to 95

Question 61

What was the effective rate of protection for thai manufacturing in 1985

Answer 61

52%

Question 62

Which 2 factors contiributed to Thailand’s loss of international competitiveness

Answer 62

- overprotection of domestic producers - lack of tech upgrading and human resource development

Question 63

In which 2 ways was monitoring of financial institutions made difficult

Answer 63

1. Increasing number of firms needed to be monitored 2. Policies which eased inflow of foreign funds (1990s)

Question 64

When did Thailand accept IMF’s article 8 removing all controls on foreign exchange transactions

Answer 64

1990

Question 65

What was the BIBF, When was the BIBF created

Answer 65

Bangkok international banking facility, 1993 - conduit for short term foreign lending

Question 66

How many loan licenses were granted by the BIBF to foreign and domestic commercial banks

Answer 66

42

Question 67

By how much did Thailand’s debt to foreign banks increase by from 1993 to 1997

Answer 67

2-3x

Question 68

What percentage of thai foreign debt in the late 1990s was short term

Answer 68

70%

Question 69

Outline the case study of the BBC

Answer 69

Bangkok bank of commerce: - dabbled in stock market speculation and takeover deals - collapsed in 1996 - had to be bailed out by government for 120b baht

Question 70

Until when was there a weak multiparty coalition

Question 71

At the time of the AFC, how many parties were part of the coalition government led by who

Answer 71

6 parties, led by PM chavalit

Question 72

Who was Thanong and why did he resign in October 1997

Answer 72

Finance minister during AFC, resigned due to petrol tax part of IMF austerity measures

Question 73

When did chavalit resign and why

Answer 73

November 1997, could not balance austerity measures and unpopularity

Question 74

Who succeeded chavalit

Answer 74

Chuan Leekpai

Question 75

How many insolvent companies did Chuan leekpai close down, and how many banks were taken over by the government

Answer 75

91, 4 banks

Question 76

What was the focus of the government post AFC

Answer 76

- industrial upgrading - identifying new market opportunities

Question 77

What was one positive of the AFC

Answer 77

Depreciation of the Thai baht strengthened its export competitiveness

Question 78

What was the GDP growth rate of Thailand in 1999 and 2000

Answer 78

4%, 4.3%

Question 79

Did money politics discontinue during Chuan Leekpai’s reforms, and why

Answer 79

Continued; businessmen continued collaborating with politicians for protection

Question 80

Who succeeded Chuan Leekpai, and when, and why

Answer 80

Shinawatra, 2001 elections - Chuan leekpai’s party accused of big business and foreign interest, neglected well-being of masses

Question 81

How did the role of the government evolve through phibun to Sarit and onwards

Answer 81

Phibun: semi-governmental monopolies Sarit: systemic state intervention, infrastructural role, scaled down in 1980s when foreign and private forces came in - failed its regulatory role in 1980s - 90s

Question 82

Did the private sector stay resilient, and why/why not

Answer 82

Stayed resilient throughout state intervention and foreign investment, due to independent history of country

Question 83

What role did the Chinese play (consider the type of relationship)

Answer 83

Private business - patron client relationship

Question 84

What would be an example of Chinese big business ventures with international capital and overseas Chinese

Question 85

What percentage of the population were Chinese, and how much control did they have over the economy (percentage)

Answer 85

10% , controlled 80%