Two trillion baht is a lot of money. It can buy about 17 Suvarnabhumi airports. Even spread over a period of seven years, which is what the government is proposing, it still amounts to spending of about 280 billion baht a year. That would be enough to buy another nine Red Line electric train routes, at an estimated 30 billion baht per line.
Prime Minister Yingluck Shinawatra surprised critics of her public speaking skills when she took firm control during an event to unveil national strategy early last week. Speaking solo for a couple of hours, Ms Yingluck delineated where the country stands and where it will be heading over the next five years.
What the PM said hit home. Thailand has lost its competitiveness compared to other countries in the region because we stopped investing in infrastructure many years ago _ when the political problems flared up in 2006 actually. The IMD World Competitive Yearbook showed that Thailand has dropped from No.27 in 2011 to No.30 in 2012, several points below Malaysia and almost in a different league entirely to Singapore.
Ms Yingluck also took her cue from what is thought to be the root cause of Thai political wrangling and addressed the problem of inequalities. Even though the issue is well-known, the prime minister's numbers are still startling. Just 1.5% of youngsters at school age from the poor segment have a chance of furthering their studies at college level compared to 32% from the non-poor group. Also, more than 90% of land ownership (about 120 million rai around the country) belongs to only about 10% of the population.
In terms of income, there are about 1 million bank accounts with more than 1 million baht in them, or 1.5% of all the bank accounts in the country, but that small percentage accounts for more than 70% of all the savings in the system, according to the Bank of Thailand.
What PM Yingluck envisaged is basically a plan to boost the country's competitiveness by improving our infrastructure, especially in the transport sector. That is where the 2-trillion-baht borrowing plan to be tabled for cabinet approval reportedly next month comes into play. Most of the money will be invested in megaprojects _ building logistic links, 10 electric train routes and four high-speed train lines over a period of seven years.
As far as the "growth" part is concerned, the strategy of generating jobs and boosting income through spending on infrastructure megaprojects is a tried and tested one. Japan did it after World War II and it pulled the country out of stagnation and helped it build the most comprehensive rail system in the world. Thailand has done it too, ever since we embarked on our first national economic and social development plan during Sarit Thanarat's time as prime minister and started building dams and digging up irrigation canal networks.
My question, though, is on the "inclusive growth" and "reduction of inequalities" part which the PM mentioned but did not elaborate on during her two-hour lecture.
It's really quite straightforward. If massive investment in road or railway networks could pull people out of poverty or bridge the rich-poor gap even a little, we would not have ended up in the situation today where the prime minister has to lecture everyone about the stark inequalities among the people in our country - how the richest in the country have an income that is 11.4 times higher than that of the poorest, and so on.
The thing is, a one-sided focus on growth without enough attention to wealth or income redistribution will not get the country to where PM Yingluck envisages it should be: an economically competitive nation with a socially sustainable platform, cultural resilience and a sense of cohesiveness to push it forward into the future.
PM Yingluck talked about the inequalities in land holdings but she did not mention even once the need to pursue serious land reform and redistribution. She talked about the need to have agricultural zoning so that we can plan what to grow and where to reap the maximum profit but there was no touching on progressive land taxes or the proposed establishment of a land bank to help the landless poor which her government has not implemented. She discussed at length how new investment would create job opportunities and lift people's incomes but there was no roadmap on how she would prevent the rich from getting richer as they are better poised to take advantage of those new opportunities and projects than the poor anyway.
Two trillion baht will create a lot of opportunities and improvements. But the question remains _ for whom?
Atiya Achakulwisut is Deputy Editor, Bangkok Post.
About the author
- Writer: Atiya Achakulwisut
Position: Deputy Editor (Day)