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Feasibility of Doing Business in Thailand

For most of the 20th Century, Thailand (Siam) was a natural economic leader in the ASEAN region. Because of the openness of the Kings who ruled Thailand, and their willingness to learn all they could of the Western ways, the nation was able to build an industrial base that includes textiles, cement, electronics, petroleum, refining, transportation equipment, tourism, food processing. Because of this openness, Thailand was the only nation in Southeast Asia to escape colonial rule. With some reservations, Thailand became an excellent place for Western businessmen to do business. In 1997, however, the economy did a dramatic turnaround, and launched what is now known as the "Asian financial crisis." The objective of this paper is to determine the feasibility today of doing business in Thailand.

Financial Aspects of Doing Business in Thailand

In 1995 Thailand's economy was singled out by the World Bank as the most consistently expansive and healthy economy world-wide in the preceding decade from 1985-1994. The Thai economy's growth rate averaged over eight percent during this decade, and was expected to move into place as the world's eighth largest economy by the year 2020. In 1997, the Thai government decided to float its currency, the baht, against the dollar.

In the early 1990s, the Thai government and its banking systems decided to "peg the baht" the United States dollar, joining the other world currencies linked to the dollar (Shari, Corben, 1997, July 7, 22). In an ironic symmetry, linking the baht to the dollar accounted for Thailand's astounding economic growth, and unlinking it, as it did in July of 1997 led to the current downturn.

Limsamarnphun (1997) pointed out that the 1997 crisis was due to the absence of a 'powerful brake' on the free-wheeling economy of the past decade, "without which a lot of foreign money was used for speculative purposes, especially for real estate and stocks. With the removal of the ...

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Feasibility of Doing Business in Thailand. (1969, December 31). In LotsofEssays.com. Retrieved 09:47, March 28, 2024, from https://www.lotsofessays.com/viewpaper/1693878.html