Overview

  • Last updated September 2017

    Over the last four decades, Thailand has made remarkable progress in social and economic development, moving from a low-income country to an upper-income country in less than a generation. As such, Thailand has been one of the widely cited development success stories, with sustained strong growth and impressive poverty reduction, particularly in the 1980s.

    Thailand’s economy grew at an average annual rate of 7.5% in the boom years of 1960 to 1996 and 5% following the Asian financial crisis during 1999-2005, creating millions of jobs that helped pull millions of people out of poverty. Gains along multiple dimensions of welfare have been impressive: more children are now getting more years of education, and virtually everyone is now covered by health insurance while other forms of social security have expanded. After average growth slowed to 3.5% over 2005-2015, with a dip to 2.3 % in 2014-2016, Thailand is now on the path to recovery.  Growth is projected to reach 3.5% in 2017 and expand further to 3.6% in 2018.

    Poverty declined substantially over the last 30 years from 67% in 1986 to 7.2% in 2015 during periods of high growth and rising agricultural prices. However, poverty and inequality continue to pose significant challenges, with vulnerabilities as a result of faltering economic growth, falling agricultural prices, and ongoing droughts. As of 2014, over 80% of the country's 7.1 million poor live in rural areas. Moreover, an additional 6.7 million were living within 20% above the national poverty line and remained vulnerable to falling back into poverty. Although inequality has declined over the past 30 years, significant and growing disparities in household income and consumption can be seen across and within regions of Thailand, with pockets of poverty remaining in the Northeast, North, and Deep South.

    The rate of economic recovery and reigniting growth will depend on how fast Thailand can address structural constraints to growth, while promoting inclusion. There are opportunities in the horizon, including improving the business regulatory environment, expanding trade through enhanced integration with the global economy, bolstering growth by implementing transformative public investments to crowd-in private capital, stimulate domestic consumption, and improving quality of public services across the entire country. This will support a resumption of a higher, more balanced, growth path that eliminates poverty and boosts shared prosperity for all citizens.

    Thailand has laid out its long-term economic goals in its 20-Year National Strategy (2017 – 2036) for attaining developed country status through broad reforms. The reforms address economic stability, human capital, equal economic opportunities, environmental sustainability, competitiveness, and effective government bureaucracies.  Recent reforms include the implementation of large multi-year public infrastructure projects related to dual tracking of railways, regulatory reforms aimed at improving ease of doing business, setting up the State Enterprise Policy Committee to improve state-owned enterprise governance, the transfer of supervisory oversight of specialized financial institutions to the Bank of Thailand, the approval of progressive inheritance and property taxes, and the launch of the National Savings Fund, a retirement safety net for informal workers.

    Going forward, the sustained pace and quality of reforms, as well as sound implementation, will be crucial for translating the reform effort into the desired economic outcomes. Reversing the relative erosion of competitiveness, improving effectiveness of the public sector, and improving education and skills will be particularly important to take Thailand out from middle to high income status. The World Bank supports of the reform agenda.

  • Last updated: September 2017

    The World Bank Group and Thailand partnership is centered around knowledge sharing and policy and technical advisory services, complemented by the mobilization and support for private sector development financing. Thailand became a donor to the International Development Association, the World Bank Group’s institution that helps the world’s poorest countries, in 2014.

    The World Bank Group’s engagement in Thailand focuses on economic policy dialogue, private sector/business climate and investment, human capital and skills development, microfinance in rural areas, climate change, green growth, and community driven development approaches in the conflict affected south of the country.

    The World Bank Group’s Thailand Systematic Country Diagnostic (SCD) "Getting Back on Track: Reviving Growth and Securing Prosperity for all", launched in March 2017, lays out opportunities for the country to restart its economic engine and renew growth that is inclusive, environmentally sustainable, and benefits all Thais.

    Building on the Systematic Country Diagnostic, the World Bank Group has engaged with government, civil society, private sector, academia and other stakeholders to prepare a new Country Partnership Framework, a vehicle in which the World Bank Group can be an effective partner with Thailand’s long-term development plans over the next few years.

    The World Bank Group’s private sector arm, the International Financial Corporation (IFC), supports investments in renewable energy, financial sector development, improving regulatory environment for private enterprise, Public-Private Partnerships, and in south-south development projects. Given Thailand’s strong manufacturing base and export oriented economic growth model, IFC continues to support supply chain manufacturing in Thailand through investments in Thai operations of foreign manufacturing conglomerates. IFC is also helping Thai companies to grow beyond Thailand's borders.

  • Last updated: September 2017

    The World Bank partners with Thailand in meeting challenges that affect people’s daily lives, with support provided mainly through the World Bank’s grant funding in collaboration with local organizations, think tanks and academic institutions.

    The World Bank Group’s global focus on climate action and on support in fragile and conflict situations is reflected in the Bank’s engagement on two of Thailand’s national priorities: support for peacebuilding efforts in Thailand’s south through community participation and local development initiatives; and for three climate action projects in Thailand. One climate change project  aims to promote cleaner production of air conditioners and foam products to help phase out harmful ozone-depleting global warming gases. Thailand has also joined the World Bank Group’s Partnership for Market Readiness, a global climate change alliance of more than 30 nations, to reduce greenhouse gas emissions and energy consumption. Recently, Thailand received a grant of $3.6 million from the World Bank’s Forest Carbon Partnership Facility to manage and protect its forests.

    The World Bank publishes the bi-annual Thailand Economic Monitor (TEM), which reviews recent economic developments and provides an independent analysis of the near- and medium-term economic outlook. It also publishes analytical work on a range of development issues that have supported Thailand’s evidence-based, growth-promoting policies. Recent examples are the Thailand Systematic Country Diagnostic, an assessment of the most pressing challenges and opportunities in ending poverty and boosting shared prosperity, the Wanted: Quality Education for All report, which highlights how improving education quality can increase labor force skills and productivity, and the Economic Inclusion of LGBTI Groups in Thailand report.

    The World Bank worked with the government and the Ministry of Health in delivering analytic and advisory work to identify key challenges to the sustainability of universal healthcare coverage and how to address these challenges, which include inequality, rising cost pressures, and the country’s transition to an aging society. The World Bank also supported the government to step up effective and cost-effective HIV prevention interventions targeting key affected populations in Thailand. 

    On the private sector side, IFC has raised $3 billion in financing that benefited more than 65 companies, contributing to Thailand’s economic development and poverty reduction. This includes work to expand microfinance for small and medium enterprises, boost trade, and support projects to mitigate climate change.

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PHOTO GALLERY

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In Depth

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Curry Promoting Peace

In Thailand’s conflict-affected deep south, community savings groups are helping bring people together and build mutual trust.

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Closing the Health Gaps for the Elderly in Thailand

A study shows a significant drop in the elderly using Thai health services, improving measures to facilitate travel can help access.

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Early HIV Testing and Treatment Saves Lives

HIV has hit Thailand hard – especially among men who have sex with men (MSM), increasing free testing and treatment services can help.

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Uncovering Thailand’s Small School Challenge

Despite Thailand’s success in expanding education, research suggests that more needs to be done to maximize students' potential.

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Youth Group Builds Peace through Education

Communities in conflict-affected areas of southern Thailand help build peace through education in more than 2000 schools.

Additional Resources

Country Office Contacts

Bangkok
30th Floor, Siam Tower, 989 Rama 1 Road, Pathumwan, Bangkok 10330
Tel: +66 2686 8300
bsangarun@worldbank.org
Washington DC
1818 H Street, NW, Washington DC 20433
Tel: +1 202-473-4709
eastasiapacific@worldbank.org