Economic and Social Reformation to Overcome Political Crisis

Dr Kriengsak Chareonwongsak
Senior Fellow, Harvard Kennedy School , Harvard University
kriengsak@kriengsak.com, www.kriengsak.com

          In June 2010, Capital Market Academy (CMA) hosted a seminar on the topic of, “Thailand Turning Point: Economic and Social Reformation Strategies to Overcome Political Crisis.” I was called to moderate this CMA seminar event between student representatives from CMA’s 1st – 10th Class Top Executive Programme, who were all there to express their views.

          As the topics discussed at this seminar seemed very useful to all stakeholders and Thai citizens for bringing Thailand out of the trouble we now face, in this article I want to summarize the ideas presented.

(prof.Kriengsak Chareonwongsak)

          I will construct a presentation framework according to my summarization of various different of thoughts presented by the speakers. The day-seminar’s ideas could be specifically categorized according to three aspects of my own frame work, which are economic prosperity and sustainability, diversity and cohesion in society, and freedom and stability in politics.

(prof.Kriengsak Chareonwongsak)

          Economic Prosperity and Sustainability

          To be economically prosperous, Thailand needs to raise the competitiveness of Thai industry. The public sector should pay more attention to the increased effectiveness of state-owned enterprises as well as the Thai business and manufacturing sector, specifically by the clear identification of star industries and the full investment of resources into those industries. At the same time, investor confidence should be built up in order to develop greater interest in the capital market and more investment in mega-projects to improve national infrastructures. Moreover, a national investor relationship centre should be established for the management and the care of foreign investors; gathering all important business data and actively attracting foreign investors instead of letting the private sector do this task in scattered fashion.

(prof.Kriengsak Chareonwongsak)

          On the other hand, in order to induce economic sustainability and reduce economic inequality, the government should focus on tax reforms. New forms of tax should be introduced at the proper time in order to increase government revenue, such as the capital gains tax. Moreover, government expenditure should be more concentrated on target groups instead of sowing the budget over all the people in general, for example, the 500 baht monthly pension for the elderly or the fifteen-year free education programme, which the rich and the poor are able to access equally. In addition to this, more development should be distributed to rural areas by such incentive measures as tax incentives given to companies that set their headquarters up in rural areas. Importantly, the public sector should help the poor have more easy access to financial capital and increase their productivity so that their minimum wage will be higher. Finally, more social entrepreneurs should be encouraged to engage in solving social problems. Their participation in the development process will reduce the government’s burden and spread help to the needy faster.

          Diversity and Cohesion in Society

          The public sector can promote social diversity by giving journalistic freedom that will not tolerate interference or distortion in the making of press reports. Likewise, journalists and press representatives must report their cases responsibly and without prejudice and distortion. In addition, the education system requires a massive overhaul in order to create people who have thinking skills, moral excellence, good understanding in democratic principles, open-mindedness and tolerance of difference.

(prof.Kriengsak Chareonwongsak)

          At the same time, public agencies that help to promote social cohesion must exercise authority that is fair and keeps to the rule of law. For a country to be under the rule of law, its legislative process must be accepted by all. It is essential that its law enforcement is serious, fair, and equal for all, not selective or forceful in order to obtain results. In addition, all parties should stop using violent words or socially divisive discourse, such as calling people terrorists when investigations have not yet taken place, etc. Moreover, the government should create equal opportunity for people to move higher up the social ladder and have easier access to resources. This will be very important to reduce inequality and build social harmony.

          Freedom and Stability in Politics

          Political freedom will occur when people have knowledge and better understanding of democratic principles, and civil society organizations are vibrant. The government itself must support people and civil society to participate fully in politics. This will enable civil society to better serve and strengthen civil politics.

(prof.Kriengsak Chareonwongsak)

          To build political stability, politicians and political election processes must be reformed urgently. A suggestion that might help is to increase politicians’ salaries up to an appropriate level in order to attract politicians who are knowledgeable and competent, and to decrease their motivation to be corrupt as well as seriously suppressing existing corruption. Besides all these proposals, parliament should be used in order to solve national problems and lead national development according to democratic principles, not just being a place for politicians to campaign or to discredit their opponents.

          In conclusion, in order to overcome the crisis we are now facing and to reform our economy and society, Thailand needs a complete change – a change to its people, a change to its system and a change to its context - which cannot happen without unity in action and spirit, as well as an all-out effort with all stakeholders seriously involved and put to work.