Thailand, a country located in the center of the Indochina peninsula currently boasts an unemployment rate of .7%. Thailand’s economy has slowly developed over time only to turn into one of the greater success stories. In the beginning stages of the countries growth, pre-1950, those heavily indebted might have sold themselves as slaves. As the country continued to grow they gained a boost once the Cold War took place. Soon after Thailand saw a huge change in its economy as international economics played a huge role.
From 1955 -1959, Thailand was able to secure an unprecedented degree of economic aid from the USA by focusing on the economy instead of military politics. During the time this took place, Thailand was under the Phibulsongkram Government that made important changes to its fiscal and monetary policies. These changes were the cancelation of the multiple exchange rate system and the introduction of the fixed & unified exchange rate system. As Thailand’s economy was developing, they also faced setbacks. American investment decreased during this time as well as their current account. Oil prices as well increased, as did inflation.
Thailand’s economy refused to diminish as they had an average growth rate in their GDP of 9.5 percent from the years of ’87-’97. In that same decade however Thailand saw a huge current account deficit. 1996 Thailand’s government closed 18 trust companies and 3 commercial banks, totaling 56 closed financial institutions by 1997. Prime Ministrer and General Chavalit Yongchaiyudh resigned on November 6th 1997, followed by the Chuan Leekpai Government, which lasted from November 1997 to February 2001. Chuan Leekpai’s government attempted to conduct a great deal of economic reform which was based upon the IMF-guided philosophy of neoliberal capitalism. His government pursued very strict fiscal and financial policies, e.g. keeping a high interest rate while cutting government spending. Year
GDP at constant prices (THB Billions)...
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