Last updated October 2019
Over the last four decades, Thailand has made remarkable progress in social and economic development, moving from a low-income to an upper-income country in less than a generation. As such, Thailand’s has been a widely cited development success story, with sustained strong growth and impressive poverty reduction.
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.
Poverty declined substantially over the last 30 years from 67% in 1986 to 7.8% in 2017 (as measured by the upper-middle income class poverty line of $5.5/day). Compared to the earlier decade, the period from 2015 to 2017 experienced slower growth. The fall in agricultural prices and negative impacts on farmers contributed to worsening household welfare. The period was also marked by declining levels of employment in agriculture and manufacturing sectors and low wage growth. Nationally, there were 478,000 more poor people in 2017 than in 2015 based on official estimates. Large regional disparities remain, and in the Northeast region, the number of poor people recently increased.
Inequality – as measured by the Gini coefficient – increased between 2015 and 2017. During this period, average household consumption per capita grew, but the household consumption of the bottom 40% of the population shrank.
According to the World Bank Human Capital Index, which measures the productivity level for the next generation of workers relative to their full potential if all education and health outcomes were maximized, uneven education quality is a big challenge for Thailand. A Thai child born today can expect to obtain 12.4 years of schooling before the age of 18. However, once adjusted for quality of learning, that only amounts to 8.6 years of schooling, indicating a gap of 3.8 years.
Thailand’s adult survival rates between ages 15-60 is lower than over half of the countries where such data is available. Over the past 15 years, Thailand’s prevalence of diabetes and hypertension have tripled and quadrupled, respectively, and combined with high rates of road injuries, has negatively affected adult survival rate. Only 85% of 15-year-olds are expected to live past age 60.