Why Thailand's Political Reform Continues to Fall Short

A Bloomberg analysis published on February 6th highlights Thailand's ongoing struggles with political reform over the past two decades. The report reveals that persistent political instability, entrenched economic power, and weak growth have hindered the country's progress, with Thailand now trailing behind regional peers. Once viewed as a promising fast-growing economy, the country now faces challenges including sluggish growth, rising debt, widening inequality, and a shrinking workforce. Senior economist Gareth Leather from Capital Economics suggests that meaningful political reform under a stable government could address Thailand's deep-rooted problems. However, frequent government changes and short-lived civilian administrations have undermined long-term planning, resulting in short-term fixes and populist spending. The analysis points out that Thailand's traditional economic engines of exports and tourism are weakening, while new industries have failed to emerge at scale. An OECD report noted that just 5% of companies account for over 85% of total corporate revenue, indicating significant economic concentration. Thailand's economic outlook remains challenging, with the Ministry of Finance projecting GDP growth of about 2% this year and the central bank seeing potential growth at just 1.5%. Political parties have pledged to lift growth to 3-5%, but economists remain skeptical about the potential without substantial structural reforms.