Introduction: Economic Development in Thailand
Thailand was a major client of the World Bank, which touted it as part of the Asian economic "miracle" in the 1980s. It was also a client of the International Monetary Fund, receiving development money designed to improve its developing economy. In the 1990s, under pressure from the IMF, Thailand was forced to open up many domestic industries to foreign capital. That situation, combined with changes in bankruptcy and property laws enabled foreign companies to invest in or buy outright local companies. If the IMF's demand seemed like an undue intrusion into the domestic economy of that country, Thailand's economy did not greatly suffer. Indeed, between 1945 and 2000, especially from the 1970s onward, the gross domestic product of Thailand was positive in every fiscal year except 1997-1998.
The dip in GDP in the late 1990s was by no means confined to Thailand. It was due to the banking crises and the "flight to quality" of capital that began in 1996 with the collapse of the Thai currency, the baht, and similar collapses of confidence in the cash positions in virtually all regions of the world outside the Anglo-American ambit: South Korea, Japan, Russia, Mexico, and Argentina. Until the financial collapse of 1997, Thailand was described as one of the economic success stories of postwar Asia, sometimes being considered Asia's fifth economic dragon, or tiger, after Hong Kong, Singapore, South Korea, and Taiwan. Even now, it is widely considered an international-trade success story.
Despite the currency crisis of the late 1990s, economic momentum in Thailand has remained on the side of capital-intensive development, in significant part because of the inflows of foreign capital over the years. For example, the 8% annual "trend growth" that obtained until 1997 declined slight thereafter, but as of 2001 was expected to remain at 3%-5% through 2003. As of 2004 Thailand's GDP stands at ...