Examine Bank Gross national income: 1.107 trillion PPP dollars

Examine the impact of the globalisation process on the economic performance of the chosen country –

Thailand’s Economic Data (2017)

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Currency: Thai baht

GDP per capita: 5,907.91 USD (2016) World Bank

Gross domestic product: 406.8 billion USD (2016) World Bank

GNI per capita: 16,070 PPP dollars (2016) World Bank

GDP growth rate: 3.2% annual change (2016) World Bank

Gross national income: 1.107 trillion PPP dollars (2016) World Bank

Internet users: 23.7% of the population (2011) World Bank.

Thailand is a country that has experienced both the positive and negative impacts of globalisation in the past 20 years.  Foreign Direct Investment into Thailand increased in the latter half of the 1980 which has impacted the Thai economy as it grew significantly. Although the financial and currency crisis in 1997 resulted in many changes to trends. Short term was one aspect that deserted Thailand in a very limited period. Another aspect was the price of real-estate and stocks plummeted, and many bank and financial companies went bankrupt.

Thailand has been significantly involved in international trade since the Sukothai Kingdom, the first kingdom of Thailand (1249-1438), usually associating trades with china. The Ayudhtaya Kingdom period (1935-1767), Thailand’s process of trading expanded to other countries including Indonesia, Japan, India, Persia and European countries such as Portugal, Spain, Holland, England and France.   During the ancient period of the Ratanakosin Kingdom (1978- Present) Thailand began to trade with the united states.  In this period of time the Thai People lived at subsistence level in a self-sufficient economy where they paid tributes to the government with their surplus products. The Government monopolized any exports of the surplus and imports. The key exports were usually agricultural and forestry products such as pepper, sugar, rice, wood, wax, horn, etc and the major imports included silk, ceramics, cloth, guns, handicrafts, etc. Although a significant advancement of Thailand occurred in the reign of King Rama V. This led to King Rama introduced and implemented social infrastructure investment, government reform, elevated level, political relations and trade agreements to counter imperialism and sustain Thailand’s independence and sovereignty.

Thailand’s relation with international trade also clearly establishes another aspect of their globalisation processes.  Prior to 1855 the Thailand Government largely monopolized their international trade. The Thailand Government also warranted very high entry fee on ship with goods and without goods basing it on the ships size.  This outcome led to the Bowring Treaty that Thailand signed with Britain in 1855 as well as many other signed treaties with other countries such as United states had resulted in liberalizing Thailand’s trade. Amongst additional things, the Treaties elevated trade monopolies and ship entry fees and fixed import duties at no more than 3%.

 

 

Thailand’s Trade liberalisations created a growth of rice production and export, particularly in the central plain area. The effect of this led to a steady transition from a subsistence-economy to a commercial economy.  The product of rice became the greatest exported item in Thailand as the production of rice increased due to an enlargement of the cultivation area under indiscrete investments.  Though, Thailand’s main export is rice, the products of teak and tin are also common exports. The result of foreign investment in teak logging Thailand as became a vital source of teak. However, the commercialization was slow and only active in the central region thus the installation of the railway assisted in the opening of commercial opportunities for North Eastern and Northern region. Due to the risks of food shortages and income instability most Thai Farmers remained self -sufficient and sold only the surplus.  This then involved the Chinese Merchants who had the role of middlemen taking the surplus from Thai farmers to commerce.

The process of globalisation continued after World War II as Thailand’s international trade expanded further in response to foreign demand. Agriculture played a leading role as the production was more differentiated and geared for exports.  This led to products such as rubber, maize, jute, tobacco and sugar cane expanding in their respective areas.   The increased cultivation of land and forest encroachment without yield improvement was the medium for the growth of agriculture. The effect of this process of globalisation resulted in the cash economy expanding and replacing the self-sufficient economy.  This led to further economic activity as commercial banks were introduced by Chinese Merchants and military officers. The consequences of income growth and better health care, population expanding at a high rate, at 3.2% per year compared to 2% per year before the World War. Thus, this shows this factor of globalisation led to an increase, demonstrating a positive impact on the Thailand economy.

 In 1962, Thailand launched their first Five-Years of National Economic and Social development plan.  Infrastructure development, import and agricultural diversification were the primary focus of the first two Five-Years Plans as it substituted in industrialisation to gain a stable and high economic growth. After this the Third plan from 1972-1976, the main primary focus altered to export oriented industrialisation, following the Fifth Plan from 1882-1986 which raised further focus on liberalisation, deregulation and decentralisation.  Although the process of this plan was significantly obstructed by the oil crisis and global recession.  The effect of this led to liberalisations to be undertaken through the seventh plan era from 1992- 1996.  Post this was the Eighth plan that prioritised their focus in the quality of human resource and peoples engaging in development design and process.

 

 

 

 

 

 Assess the impact on the environment from economic development in that country.

Thailand has had substantial and enviable record of economic growth since 1986. Although as growth managed to gain at a rapid pace, questions arise about the impact on the environment as the country developed. These impacts on the environment includes environmental costs, whether the inclusion of those costs would reduce, and reverse, the improvements in welfare resulted in higher income.  This assessment of the environment primary focuses is around 3 significant areas including energy production and use, transport and manufacturing.  The three main findings out of these aspects include:

–          1) the recent rapid economic growth has resulted in many environmental issues.

 

–          2) attaining environmental developments will not be costless.

 

–          3) while it will be essential for Thai policy makers to evaluate trade-offs, it should be possible to not give up to much economic growth whilst improving the urban environment.

Due to Thailand’s significant economic growth it has resulted in environmental issues. Thailand is heavily involved with issues and problems such as with air and water pollution, deforestation, water scarcity, declining wildlife population and water issues.  Thailand’s costs of air and water pollution was recorded in 2004 by an indicator that it scaled up to around 1.6-2.6 % of GDP per year. The effect of Thailand economic growth cause considerable damage to its people and environment they implemented a Seventh Economic and Social Development Plan, which demonstrates the protection of the environment. The aim of this plan was to achieve sustainable growth and stability, especially in the industry.  Air pollution is a specific example that has been identified as a negative to Thailand’s environment due to the rapid economic growth it experiences as it has experienced a rise in pollution from 31,000 to 49,000 within 20 years. This is due the industrial growth creating prominent levels of pollution. Vehicles and factories are two main contributors to the air pollution in Thailand, although is a required necessity to help Thailand develop.  The result of the pollution created by the transportation of products and factory emissions has also forced the Thailand Pollution Control Department and other organisations to develop standards to reduce air pollution.  The aim of this was to focus on shifting to lower emissions from vehicle engines and improving public transportation.  Another prominent enquiry made by the Thai Government was to force the factories and powerplants to reduce emissions.  Therefore, the rapid economic growth in Thailand was negatively effected as it resulted in large increases of air pollution due the vehicle and factories emissions, although strategy’s have been introduced to reduce these emissions.

 

 

 

To control energy related emissions, this report urges the that the policy reforms be phased so that control measures are focussed initially at emissions of suspended particulate matter and Sulphur dioxide and that combustion of fuels taxes and emissions standards be implemented.  Studies have been undertaken for the reduction of transport emissions as they have identified two general processes. The first process recognised is an attempt to reduce emissions from vehicles as well as to control congestion.  The second implementation is called a phased implement control strategy. In conclusion control organic and chemical discharge and solid hazardous waste from manufacturing are informed by the report to make policy reforms.

 

Other Environmental Issues and Policies:

–          Loss of natural grassland and forests due to expansions in agriculture and industry.

–          Air pollution

–          Loss of wetlands and lakes

–          Carbon dioxide emission

–          Poor disposal of household and industrial waste

–          Pollution controlling needs to be established.

–          Climate change

 

 

 

 

4. Evaluate the strategies that this economy is using to promote economic growth and development.

Strategies that have been implemented by Thailand to promote economic growth and development are consider and important aspect to Thailand’s economy as it has only lead to positive consequences. Diversification of the economy is an important aspect as it plays leading role in the development and economic growth of Thailand.  The main concept of diversification was Thailand began its manufacturing in basic agricultural process and then progressed to more sophisticated industries and types of manufacturing through the uses of its natural resources and low costing labour.  Foreign Direct Investment was heavily involved with diversification of the economy as it assisted in a range of products including electronics, chemical, foods and property.  Low manufacturing costs in Thailand is a crucial factor that attracts FDI’s. Manufacturing in Foreign investments make up 50% of the countries industrial production and the total workforce involved in projects makes up 20% of Thailand’s population. Thus, the effect of this strategy leads to a high economic growth rate and state advancements.

Developing strategies for alternate power sources is another process that Thailand implemented to promote economic growth and development.  Thailand’s period from 1970 1979 was a crisis as the country faced a significant amount of hardships.   The Gulf of Thailand played key role as the discovery of the country’s natural gas field led to less dependence on Thailand importing oil. The effect of this forced Thailand to implement strategies in seeking alternative energy sources, for example hydropower, natural gas, coal and wind power.  The effect of this resulted in lower costs in power as these natural sources were able for use in the manufacturing and agricultural industry. The result of this then led Thailand to considering nuclear power as it provides further lower costs of power generation. Therefore, these alternate sources of power led to a shift as Thailand’s cost of production was reduced and productions levels increased.

Another example, is Thailand targeting industries and policy formulation to once again increase economic development and growth.  Due to Thailand concerns in relation to Thailand in the global economy they desired to be put in the competitive world.  The process identified in is plan is to improve industries that can add value to the domestic economy. This will lead Thailand to creating new and more jobs, preserving the environment and managing natural resources in a more efficient manner.  Thailand Government is seeking small scale market segments in scale to attract many competitors. The targeted industries in Thailand that can work efficiently include agriculture, fashion, healthcare, electronic, etc.  In these following industries the Thai Government has implemented role of monitoring, providing troubleshooting’s in selected industries and designing. A specific example in Thailand demonstrating this strategy is in the agricultural programs in the name of the kitchen of the world.  The Thai government acted in this by identifying industrial segments in which that the country can operate with the available resources at low cost whilst a high productivity and efficiency rate as well as a getting continuous assured monitoring from the Thai Government. Therefore, this increase in resources and labour employment, leading to sustainable growth and development.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Bibliography

Sanath Dasanayaka, Personal Development Author and Leadership Expert Follow. (2014, April 24). Economic Development in Thailand in detailed point of view. Retrieved January 22, 2018, from https://www.slideshare.net/sanathdasanayaka73/economic-development-in-thailand-in-detailed-point-of-view

Iizuka, A. K. (n.d.). Introduction: What did globalization bring to Thailand? Retrieved January 12, 2018, from http://wordpress.clarku.edu/id125/2016/03/19/introduction-what-did-globalization-bring-to-thailand/

Thailand – Economic development. (n.d.). Retrieved January 22, 2018, from http://www.nationsencyclopedia.com/Asia-and-Oceania/Thailand-ECONOMIC-DEVELOPMENT.html

W. (2002). Globalization and Social Development in Thailand. Retrieved January 21, 2018, from http://kumlai.free.fr/RESEARCH/THESE/TEXTE/INEQUALITY/Thailande/Globalization%20and%20social%20development%20in%20Thailand.pdf

Economy of Thailand. (2018, January 12). Retrieved January 18, 2018, from https://en.wikipedia.org/wiki/Economy_of_Thailand

 

https://www.economist.com/blogs/graphicdetail/2015/09/graphics

 

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