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Thailand's New Govt Endeavors to Achieve National Socioeconomic Revival
Six months before he was elected as the prime minister of Thailand, Thaksin Shinawatra had once baffled the audience at a local economic forum by his vision of developing the country into "Asia's France," which is featured by balanced urban-rural growth and active small-and-medium-sized business (SMEs).
More startlingly, he announced that if his Thai Rak Thai Party wins the January election, the new government would give each of the country's 70,000 village one million baht (22,000 US dollars) as a revolving fund, and grant poor farmers a three-year suspension of debts owed to the government. He also wanted each village to produce one product to be exported and so to increase revenue for the country.
These ideas seemed unthinkable in a developing country whose economy is still not out of woods from the financial crisis in 1997 and facing emerging social problems. No other Thai politicians ever came up with this kind of thoughts. Naturally, Thaksin was scorned by most of the media at that time, especially those the west, for delivering such "Arabian Nights tales."
However, now after three months in office, Thaksin and his new government have proved that they really "mean business", and are trying their best for national socioeconomic revival as the debt-moratorium program and the universal health scheme which allows people to pay only 30 baht (67 US cents) for each visit to hospitals, both once hardly to believe, have been implemented in some parts of the country.
As for other campaign promises of Thai Rak Thai Party, the details of how to set up a national assets management company to take over 26 billions US dollars of bad debts in the ailing banking system has been settled through negotiations between cabinet ministers and bankers within one week after the new government was formed, while the "People's Bank" project and the village-fund plan are ready to be enacted in June and July, respectively.
As some analysts pointed out, the Thai Rak Thai Party had taken those rosy prospects equal to a blossoming European rural landscape into the heart and soul of its successful election campaign, and once the Thai Rak Thai-led government set up in February, it formed a national agenda to carry out the plans without hesitation and has been obsessively endeavoring to make them real.
However, all these big-spending schemes, as critics said, are certainly to further raise the country's public debt level which has already risen to 55 percent of Gross Domestic Products (GDP) from 15 percent of that in 1997, and create tremendous fiscal burden for the future generations to bear.
But Thaksin and his government resolved to carry on its agenda and believed it would benefit the country in the longer run and make it better-prepared for the next global economic growth wave expected several years later.
To pacify the worries about increasing fiscal burdens, they labored for financing its campaign promises by raising taxes on luxury goods and issuing bonds.
The business community, especially those concerned with banking and agriculture, as well as the massive poor people, voiced strong support to new government's policies.
Danin Chearavanont, chairman of the Charoen Pokphand group, the country's biggest argro-industrial conglomerate, recently told Xinhua that he believed the new government's efforts to develop the rural sector and help the poor are in the right direction.
"In a country where sixty percent of population live in villages, it is most important to boost farmer's income and so the whole economy will be revived," he said.
Danin noted that he remembered an old peasant saying Thaksin was "the only man who can really care and come to save us."
There are also signs that the government's populist policies
could possibly get more international recognition. Jacques Diouf, director-general of the United Nations Food and Agriculture Organization (FAO) had praised the Thai government's rural plans during his recent visit here, saying that could be set as a model for other developing countries in their efforts to cut poverty and ease hunger.
While fulfilling the policy promises, the new government has to face the harsh reality of slowing economic growth and emerging social problems such as drugs, corruption and poverty.
Determined to fight illicit drugs, which is a serious problem in the Thai society, the government ordered weekly executions of drug dealers and producers.
What must be noted is that the new regime came into power when the economy is losing impetus as the export growth, the main engine of economic recovery, impeded by US economic growth slowdown and the value of baht is being dragged down into new lows by other regional currencies.
The economic growth forecast has recently been trimmed down to 3.5-4 percent from the original goal of 4-4.5 percent.
To cope with the economic woes, shortly after assuming office, the new government announced four urgent measures on March 2 to improve economic conditions, including accelerating exports of agriculture goods, promoting investment through tax incentives, supporting SMEs and promoting the use of local-made products.
Recently, to boost economic confidence, the government initiated a stimulus package for solving short-term economic difficulties such as declining foreign investment, export growth slowdown and problems in implementing the Thai Rak Thai campaign promises.
During the first three months in power, the government has also created a unique way to brainstorm ideas and policies by opening workshops with professionals on certain aspect of economic and social problems.
Starting from March, Thaksin has chaired a series of national seminars on drugs, capital markets, tourism and SMEs, and those meetings have came up with new policies and measures in respective areas.
To make the mass understand the government's policy and work, the premier initiated a weekly national radio address.
Compared with its predecessors, this government prefer to look inwards rather than seeking help from overseas. It is understandable that Thaksin and his cabinet peers try to find new impetus for the economy as the export losing its brunt, but he also once caused attacks from western media as "slamming the door for investors."
However, Thaksin successfully defended his government at the grandiose Fortune Global Forum in Hong Kong on May 10, by saying in his speech that "a strong stable social platform is imperative in generating investor confidence and a prerequisite for a conducive and desirable investment climate."
The debut of the premier at the highlighted international venue proved to be successful at least at home. According to a recent survey conducted in Bangkok, over half of the respondents thought the international image of the new government has been improved by his speech at the meeting.
However, the biggest uncertainty about this government now rests on the finale of Thaksin's asset case in the Constitutional Court. If the court finally ruled that he had intentionally hid his wealth while serving as a vice premier in 1997, Thaksin will have to resign and stay out of politics for five consecutive years.
But analysts said since Thai Rak Thai Party enjoys an absolute majority in either parliament or cabinet, the policy direction would not be largely affected by the premier's possible ouster.
According to himself, Thaksin considers currently the biggest challenge ahead for his government is to raise domestic demand and enhance the country's competitiveness through fostering a knowledge-based economy.
During a recent interview with Chinese media based in Thailand, the premier said he was satisfied with the government's work during first three months in power, because they are moving very quickly to carry out policies.
What he was dissatisfied with is the widespread low-efficiency and corruption in the bureaucracy, which he said it is a big obstacle for pushing the government's policy initiatives.
According to analysts, whether the government will be successful during its four-year tenure depends on the final results of the implementation of its promised socioeconomic projects and the way it handles the current emerging problems. It is not gonna be easy, but will be less difficult if the government keeping its endeavor momentum.
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