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publication March 5, 2020

Taking the Pulse of Poverty and Inequality in Thailand

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Key Findings

Based on official estimates, poverty has increased in Thailand twice in recent years: 2016 and 2018.  

  • Over the past three decades, and since official poverty data were first published in 1988, Thailand has made substantial gains on key social and economic development. Official poverty rates reduced from 65.2% in 1988 to 9.85% in 2018.
  • However, over the past few years, household incomes and consumption growth have stalled nationwide, with declines among households at the bottom of the income distribution.
  • Between 2015 and 2018, the poverty rate in Thailand grew from 7.21% to 9.85% and the absolute number of people living in poverty increased from 4.85 million to more than 6.7 million.
  • In the Central and Northeast, the population of poor increased by over half a million in each region from 2015 to 2018.
  • Thailand’s official poverty rate increased in 2016 and again in 2018. These were the fourth and fifth instances official poverty rates increased since 1988, the previous three instances (1998, 2000, and 2008) occurring around the time of financial crises.
  • In 2017, for the first time, the South became the region with the highest poverty rate.
  • In 2018, Mae Hong Son, Pattani, Kalasin, Narathiwat and Tak were the five provinces with the highest poverty rates. Most of these provinces are located near the border or are in the conflict-affected South.
  • The increase in poverty in 2018 was widespread occurring in all regions and 61 out of 77 provinces.
  • The reversal of poverty reduction is related to worsening economic and environmental conditions:
    • Over the past few years, Thailand’s growth rate has been lower than other large economies in the developing East Asia and Pacific region. In October 2019, Thailand had one of the lowest GDP growth rates in the region, at 2.7%.
    • Growth has been moderating across the region as trade and economic growth have also weakened globally, affecting exports.
    • Droughts have affected the livelihoods of farmers who are already typically the poorest.
    • Tourism has experienced declines.
  • Recent changes in household income inform on the sources of the change in poverty
    • Real farm and business incomes declined in rural and urban households, respectively. Wage income also declined in urban households.
    • Nationally, this signals a reversal in trends from the past. In the period 2007–2013, wages, farm incomes, and remittances contributed to poverty reduction, but in the period 2015–2017 they became sources of rising poverty.
    • Perceptions data from 2016 and onward also indicate that households were feeling their living conditions worsen.

The report calls for active interventions and investments to help households break out of generational poverty, support aging cohorts, and boost Thailand’s growth prospects.

  • A more nuanced picture of equity and a better understanding of vulnerability are needed to conduct a candid discussion of Thailand’s way forward to build a prosperous society.
  • Populations that are vulnerable must be better identified, and there needs to be swifter action, risk management, and alternative productive activities when the economy changes.
  • Looking forward, narrowing the inequality experienced by children today is important to allow all children to reach their full potential, be productive in society, and help the economy grow.
    • For example, over half of children aged 6-14 in Bangkok have joint access to all opportunities (e.g. education, assets, infrastructure), compared with only 10% of children in the Northeast region.
    • While basic opportunities are near universal, such as enrolment in primary school, more advanced opportunities are lacking, such as access to the Internet.
    • The next generation will be smaller due to aging and lower fertility rates, and every child will need to be given a fair shot, and be provided the health and education opportunities to reach his/her full potential.
  • The standards at which household well-being are measured also need to rise, as the cost-of-living, aspirations, and basic necessities increase in upper middle-income countries.