Thailand

This report is based on a November 1993 mission in response to the Government's request for additional analysis to support its efforts to improve the efficiency and... Show More + effectiveness of state enterprises and increase private-sector participation. The report presents a strategy and recommendations for expanding private-sector participation in state-owned public utilities and a step-by-step approach to divestiture of 15 large public utility enterprises. Thailand's major interest in privatizing the 15 public utiliy enterprises is a recognition that rapid rises in state enterprise investment - which tripled over 1989-93 - must continue, or even accelerate, to meet the infrastructure and service needs of one of the world's fastest growing economies. Converting these enterprises to well-run fully or partially privately owned firms will require obtaining financing in domestic or international capital markets without government loans of guarantees. The Government also wants to improve the existing performance evaluation system, and expects that improving efficiency and flexibility will be achieved by privatized firms under adequate competition or regulation. The 15 public utilities on which this report focuses, include four energy sector enterprises, six transport utilities, two water supply enterprises, and three telecommunications firms. The report discusses the following: 1) the overall role and impact of the parastatal sector in Thailand's economy; 2) the increasing private-sector participation in state enterprises; 3) recommendations to improve the efficiency of the state enterprises and to set up a new performance evaluation system; 4) steps needed to prepare for privatization, including legal considerations, corporatization, capital markets, labor, pension funds, and an Infrastructure Development Facility; and 5) the divestiture experience of other countries. Show Less -

This financial sector study was undertaken to address concerns about the efficiency of the financial intermediation process to raise and channel the needed savings into... Show More + productive investments in Thailand; and about the future role of the financial system of the Bank for Agriculture and Agricultural Cooperatives (BAAC) and the Industrial Finance Corporation of Thailand (IFCT). Emphasis is placed on the macroeconomic perspective, specifically on policies toward the financial sector in Thailand, interest rate policy, and how the Bank of Thailand (BOT) may improve its toolkit for the conduct of monetary policy. The report also focuses on the major problems and areas for improvement with commercial banks and securities and finance companies, including their competition or concentration in the financial system and their regulation and supervision (particularly with regard to failing and failed institutions). Also covered are issues relating to industrial and agricultural credit; the present state of the money, equities and fixed income securities markets; and the feasibility of financial leasing, factoring accounts receivables and trust receipt financing. Show Less -

Following a period of policy adjustment and unsteady economic performance during the first half of the 1980s, the Thai economy has achieved an impressive record of economic... Show More + expansion since 1986, characterized by surging exports, narrowing fiscal and external deficits, price stability, and an investment boom. This economic boom is taking place against the backdrop of rapid structural shifts in Thailand that have made the economy distinctly export oriented and established manufacturing as the main export sector. Rice, which had been the leading export commodity of Thailand for many years was surpassed by textile products in 1985, and in two years textile exports rose to more than twice the level of rice exports. Helped by a large influx of foreign direct investment in advanced manufacturing industries, Thai manufacturers are poised to move into higher technology areas. A coincidence of the right domestic and external conditions is vital for Thailand to experience an industrial take off. Therefore, the most important economic policy question at present is how the current expansion can be sustained and converted into such an industrial take-off. This report aims to answer this question, in addition to serving the basic function of analyzing the recent economic developments. Show Less -

This report reviews the current economic situation and medium term development prospects for Thailand during the Sixth Five-Year Plan period. In addition, it also reviews... Show More + two special topics, institutional reform and economic policy management, and employment issues and prospects. The principal macro-economic problem identified is the unsustainably large gap between savings and investment which is mainly caused by a low savings rate. The challenge for the future is to reduce the savings-investment gap while not sacrificing growth. Raising public savings, reforming the tax system, improving the incentive system facing private and public investors and continuing to make progress towards improving the efficiency of public expenditure are the key ingredients needed for adequate growth. With such improvements Thailand can afford to finance an investment program of adequate size and quality to sustain medium-term growth at a satisfactory rate. Show Less -

The Thai economy achieved impressive growth during the past two decades, with the expansion of manufacturing as a key element. There are, however, a number of problems... Show More + that confront manufacturing growth in the future. They include: the continuation of an import-substitution strategy and associated protective structure; the limited contribution of manufacturing to employment growth; a continued high dependency on primary exports despite the growth of manufactured exports; the bias against exports; and issues relating to the formulation of export incentives and their administration. The purpose of this report is to review in some depth the context in which Thailand's exports have developed, to assess the current policy and administrative framework and to propose changes that would aid exports by offsetting the anti-export bias imposed by current policies. The changes would create a framework within which non-traditional exports could grow at the increased rates that are so important if Thailand's economy is to expand at an adequate rate in the future while also achieving a sustainable external balance. Show Less -

The report reviews Thailand's economic adjustment to the international economic changes which occurred during the 1970s and early 1980s, both from a retrospective vantage... Show More + point and looking towards the remainder of the 1980s, with particular emphasis on the last three years of the Fifth Plan period and on the role of the public sector and the maangement of its resources. Part I reviews the overall economic performance and outlook; Part II provides an assessment of aggregate public resource management in terms of revenue mobilization, expenditure allocation, and foreign borrowing. Part III reviews the major sectoral policy issues and public investment programs for agriculture, industry, energy, transport and communications, and human resource development. Volume II contains annexes on shadow prices for economic analysis, background information of land availability and on public expenditure programs, a list of World Bank reports on Thailand (1981-83) and the statistical annexes. Show Less -

The purpose of this report is to assess the prospects for Thai agriculture in the 1980s. This is done by analyzing the changing effects of past agricultural growth,... Show More + the implications for the 1980s, and the required structural changes in terms of program and policy constraints to increase production in rainfed agriculture and the measures needed to alleviate the constraints and exploit the more feasible opportunities identified. The report's emphasis on production is based on the assumption that, since widespread linkages have already been established between agricultural growth and the amelioration of rural poverty, the trade-off between agricultural growth and equity will continue to be limited. Volume I of the report provides the overview. Volume II presents the general report and includes: the role and performance of the agricultural sector; program and policy priorities for agricultural intensification in the 1980s; reaching the rural poor; subsector performance in the 1980s; and, preinvestment studies and program/project support. Details of statistics, programs and policies for various crop and livestock subsectors, rainfed farmer profiles and key support services for yield improvement are given in the annexes contained in Volumes III and IV. Show Less -

The purpose of this report is to assess the prospects for Thai agriculture in the 1980s. This is done by analyzing the changing effects of past agricultural growth,... Show More + the implications for the 1980s, and the required structural changes in terms of program and policy constraints to increase production in rainfed agriculture and the measures needed to alleviate the constraints and exploit the more feasible opportunities identified. The report's emphasis on production is based on the assumption that, since widespread linkages have already been established between agricultural growth and the amelioration of rural poverty, the trade-off between agricultural growth and equity will continue to be limited. Volume I of the report provides the overview. Volume II presents the general report and includes: the role and performance of the agricultural sector; program and policy priorities for agricultural intensification in the 1980s; reaching the rural poor; subsector performance in the 1980s; and, preinvestment studies and program/project support. Details of statistics, programs and policies for various crop and livestock subsectors, rainfed farmer profiles and key support services for yield improvement are given in the annexes contained in Volumes III and IV. Show Less -

Thailand is still going through a period of political and social transition that started in October 1973, and repressed grievances continue to surface. In 1973-74 the... Show More + country experienced an export boom which caused private investment to surge upwards. However, since mid-1974, the strong stimulus from the external trade sector has faded, and in 1975 continued deterioration in the terms of trade has kept savings constant. Reliance on foreign savings correspondingly increased. In addition, unfavorable weather caused agricultural production to stagnate. With the pace of economic activity slackening, the objective of fiscal and monetary policy in FY75 was to stimulate the economy. In 1976 export prices are expected to increase moderately, but oil price increases and continued inflation in the industrial countries are likely to cause import prices to rise more rapidly than export prices. The Fourth Plan aims to improve the distribution of benefits and reduce inequalities, but the magnitude of public expenditures needed to achieve these aims will require very careful planning and allocation balanced between the economic and social sectors. Continued emphasis on export promotion and expanded foreign borrowing will be necessary. Show Less -

Thailand's new government (1973) has confirmed its support for the objectives of the Third Plan. It is maintaining the free enterprise orientation, but is far more sympathetic... Show More + to the needs of lower income groups than was its predecessor. Improvement in Thailand's export markets has resulted in balance of payments performance far better than was forecast in the Third Plan, and expected capital inflows plus favorable export prices should enable the country to finance the increased cost of imports, including petroleum. Agricultural production has recovered well from the drought of 1972, but supporting services for intensifying production will be necessary. The rapid expansion of manufactured exports has strengthened the small modern industrial sector. The rapid population growth rate will give employment creation, labor relations and wage policy issues increasing importance. The economy's need for increased public expenditure is great and will require restructuring the tax system. Policies should be designed to stimulate expansion of export earnings and rational import substitution and to increase access to diversified sources of external capital. Show Less -