A Comparative Analysis of the Economies of Thailand and the Philippines

Posted on Posted in 2015-2016
By Khalil Elijah A. Celestial

Economic development is more than just being about the money.

The Philippines at present is considered as a ‘tiger economy’ because of its high economic growth rate compared to its neighboring Asian countries. However, despite this good news, the country remains to be one of the most impoverished countries and even considered to be one of the most corrupt in Asia according to a recent article by The New York Times. Why is that?

The Philippines is one of the few countries that avoided a recession in 2009, maintaining economic stability. The Philippine government’s priority under President Benigno Aquino III’s administration is achieving economic stability and sustaining high economic growth. An example of this effort is through the Philippine Development Plan established by the National Economic Development Authority for the year 2011 – 2016. The PDP adopts a framework of inclusive growth which is sustained economic growth, generates mass employment and reduces poverty. This also aims to pursue rapid economic development, improving the lives of Filipino families.

There is high economic growth because of the large amount of remittances that the overseas Filipino workers send to their families here in the Philippines. This explains the high income that Filipinos generate as a nation, even though they are outside the country. This income generated is recorded as growth under the Gross National Product. The Gross National Product measures the income of Filipinos regardless of where they are in the world. This income somewhat improves the lives of the families that OFWs left behind here; however, this does not necessarily improve the lives of many other Filipinos. Prices keep increasin, the population keeps growing, and more families are falling under the poverty line. The government has to focus more on creating employment for Filipinos by providing job opportunities through local and foreign investors. Also, there is the problem of underemployment. Focus also has to be made on the improvement of the quality of education in the country such that there are enough job positions to be filled up.

The government also claims that there are efforts to improve the agricultural sector in the country as part of the PDP. However, the Department of Agriculture continues to be one of the government agencies that receive the lowest cut from the national budget every year. This shows that the Philippines has given more priority to the industry and services sectors instead of agriculture where the Philippines can be more productive on given its vast land areas especially in the provinces. Therefore, the Philippines should also work on how the agricultural sector can be improved in terms of production, and that there is also sufficient amount of employment opportunities for Filipinos. This can be done through better funding for the Department of Agriculture and its related agencies and institutions such as the International Rice Research Institute allowing the Philippines to be successful again in terms of agriculture.

As mentioned, there is also the issue of the ongoing corruption in the government. The government claims that one of the Aquino administration’s objectives is to fight corruption in the government. However, despite this claim, there are different issues that arose and continue to be problems such as the Pork Barrel Scam, the possibilities that the funds donated by many foreign countries were pocketed by government officials after Typhoon Yolanda, and more recently, the existence of a ‘laglag-bala’ syndicate in NAIA. The next administration must be able to reduce the incidences and if possible, eradicate it in order for the plans for the economic development of the country to be carried out.
At present, the Philippines is not yet assured a good future. The government may boast about the country’s economy being a ‘tiger economy’ because of its high economic growth, but the economic development has to be given more priority through employment and the improvement of the agricultural sector for the country to be considered to be one of the best in the world in the future.

This brings up the Philippines’ twin tiger economy, Thailand. Moving on to Thailand, the country has recently been through a coup d’ tat in 2014 by the Royal Thai Army. At present, Thailand is governed under military rule by General Prayut Chan-o-cha, who was the leader of the coup. The coup happened, according to the general, because “of the violence in Bangkok and many parts of the country that resulted in loss of innocent lives and property, which was likely to escalate.” After the military seized control of the government, martial law was declared and the constitution was suspended except on the part of the monarchy. The coup overthrew its prime minister, Yingluck Shinawatra because of alleged corruption and abuse of power. After the coup and until present, the country is experiencing problems regarding its economy with the government being problematic regarding the issue.

In a report by thediplomat.com, the country’s rural income and exports have declined since the general’s rise to power. It is also mentioned in the article that the country lost an amount between US$8.5 billion and US$12.8 billion in missed in GDP growth. Because of the coup, the economy has been declining and the Thai people continue suffer from their worsening conditions.
It is accused against the former prime minister that she was corrupt and abused her power as mentioned earlier. Because of that the country’s Supreme Court summoned her to answer regarding the issue of corruption in her rice-buying scheme. In the program, the government would buy the farmers’ produce for a higher price compared to its market value. However, the government found themselves in a situation where there are tons of unsellable produce. Because of this, the junta asked the former prime minister to pay for the losses from her own pockets. The program is said to be beneficial for the farmers and the farmers themselves favoured the program.

The situation in Thailand can be said to be somewhat similar to the one in the Philippines only minus the coups that happen. It has been a regular incidence in Thailand that there are coups meant to overthrow governments. There have been 12 coups including the one in 2014 since 1932 when absolute monarchy was removed. This shows the political instability in Thailand. In a report by the BBC, it is revealed that the prime minister was hated by the urban and middle-class elite accusing her of corruption while the poorer voters in Thailand supported her. One reason for this is the rice-buying scheme for the farmers in the rural areas. This seems to show the conflict of interest among the Thais. Why intend to overthrow their leader when she seems to be able to address the needs of the poor? However, there may actually be a problem in terms of corruption in the government which may also seem to affect the economic development of Thailand. It may show the difference in the education of the poor and the middle-class elite of their society. Poverty is also known to be an issue in Thailand, which is another possible factor in the difference of educational attainment of people. Usually, the tendency of the more educated, which in this case may be the middle-class, is that they have more knowledge regarding the situation of Thailand and they can also understand it better compared to the poor who prioritize their daily living more, such as the provision of food for themselves. They may favour the government because their needs are being addressed, which is shown through the rice-buying scheme, while the other members of society may also be neglected which may be why they accuse the government of corruption.

There is also the issue of the politics of fear because until now, Thailand is still under military rule and strict laws are implemented upon the people. This has also been a factor in the decreasing productivity of the country. In the same report by thediplomat.com, it is mentioned that the government is known to look for a scapegoat, which the people can blame despite their worsening conditions. The Thai people are also becoming more frustrated by the fact that the restoration of democratic rule has been postponed for many times already.

The Thai government has to focus on listening and realizing the needs of the people regardless of status, educational attainment, etc., and changing the system for the betterment of the people and the country should not be ruled by the gun because it can lead to abuse of power which was the same reason the last prime minister was ousted for. However, the people must also realize that economic development does not come at an instant. It takes time, effort, resources in order to achieve that development they aspire for.

In both cases, a country’s economic sufficiency relies heavily on its political climate and stability. It is not enough to say that businesses are thriving and money is being made. Rather, for development to occur, there must be an effort from the political sector to improve their services to the people as well.


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