The weakness of every military government in Thailand’s past is their inability to mange the economy effectively, which is a core reason why Prime Minister Prayut Chan-ocha dragged Somkit Jatusripitak into the economic sphere. The reason for the trust in this man is because he was behind the success of Thailand’s economic stability during Thaksin’s tenure, but is he all that good?

For the past 3 years since Mr. Somkid took this vital role under Prime Minister Prayut’s government in 2016, we have seen improvements in the country’s GDP. In 2016 we saw GDP grow by 2.8% and this year it currently stands at 3.9%.

Mr. Somkid’s key project for the economic stimulus was the “Pracharath Projects” which aimed to pull in the private sector, especially the biggest players, to help move the economy forward with over 10 committees working closely to fulfill this initiative.

Other than the Pracharath Projects, we have also seen the creation of the “Thailand 4.0 Initiative” which eyes to make Thailand more technologically competitive on the global stage and feeding its advancement into the Eastern Economic Corridor (EEC).

The EEC and the 4.0 Initiative laid a foundation for economic development outside of Bangkok, which planted seeds for helping the poor, tackling low agricultural prices and developing the welfare card.  

It all looks really good from face-value, but if we carefully unpack his works the GDP growth and the projects he launched gives little reflection to the realistic impacts they had on the Thai economy.

From thorough analysis, Mr. Somkid’s input in the economic sphere had little to no impact on the growth of Thailand’s GDP. In reality, it was the revival of the global economy which saw Thailand’s exports perform better. Thai exports account for around 70% of the GDP, and the 19-month long growth in this sector was the true contributor to the GDP growth.

It became even more clear when just one month in September 2018, Thailand saw its exports hit the red digits. Economic growth in Q3 dropped from 4.6% to a whopping 3.3%. Also, it is the big companies and foreign investors who have the greatest weight on our export statistics.

It is unlikely for SMEs exporting abroad to be the key contributors to these outstanding figures, which means the economic growth only reflects the tip of the pyramid’s well-being.

The “Thailand 4.0 Initiative” also has hidden implications, creating an opportunity for the big players in the private sector to benefit from technological integration and shadowing the smaller competitors. After all, it is those with financial readiness to hop on this train.

Big industries are the most successful breadwinners through the promotion of online shopping platforms as they no longer have to rely on middlemen to distribute their products. This has caused an entire sector of jobs to rapidly disappear, with no concrete plans to support job losses. Many industries are also adopting technologies to replace mechanical jobs too.

The EEC on the other hand has yet to see any concrete development. Other than giving a 99-year land ownership and invoking section 44 to incentivize foreign companies to invest tax-free, not much has been said about actual investors. China’s billionaire tycoon Jack Ma visited Thailand to embellish the scene but Chinese investors have yet to commit along with other countries. Japan is also eyeing Vietnam instead.

Thailand’s agricultural sector is also still suffering, with palm and rubber prices still abysmal.

To summarize Mr. Somkid’s contribution to the economy, it is simply loose. Prime Minister Prayut needs someone better and decisive. We are living in a period where wealth is expanding internally, and poverty is expanding externally. We are not sure if this is the right man for the job.