Up until the pandemic, the economy was a reliable workhorse that delivered growth.
Yet for the average citizen, this still wasn't a guarantee of a better life as wages were stagnant and often just enough to escape poverty. During the height of the Covid-19 pandemic from 2020–2022, vulnerable groups were hit hard by unemployment and the lack of safety nets.
One survey recently showed how rising unemployment during the pandemic caused a 30% spike in the number of homeless people in Bangkok. Many others became dependent on food donations as their savings vanished. What made this shock to the system especially worse is the rampant wealth inequality that has reared its ugly head over the country's modern history.
In Thailand, a significant portion of wealth is concentrated in the hands of the minority. In 2018, a survey by Swiss bank Credit Suisse found Thailand to be the most unequal country in the world.
Some of the statistics were truly baffling, such as how the richest 1% owned almost 67% of the country's wealth. Furthermore, there is spatial inequality or unequal distribution of development and opportunities.
Provinces located in the "centre" or Bangkok and its surroundings, are wealthy and enjoy the bulk of foreign direct investment, industrial and infrastructure projects while peripheral regions, such as northeastern Isan, see little from the government and have higher rates of poverty.
In 2016, Bangkok, which makes up 15% of the population, contributed 30% towards GDP while the Northeast, which makes up 25% of the population, contributed just 10%. Marginalising or excluding segments of the population or regions from development is dangerous as it erodes trust in institutions and raises the threat of political or social unrest. Thus, the responsibility of any government is to provide equal access and privileges to each citizen, regardless of where they are.
When rising inequality became a sore point after lengthy periods of economic growth which benefitted a small segment of the population, the government began to devise programmes and policies to protect vulnerable populations.
Some of these initiatives include the social security system to provide healthcare access, unemployment benefits and pensions, agricultural support programmes such as subsidies, price stabilisation, education reforms and financial assistance for children.
Also included were the One Tambon One Product programme to promote local entrepreneurship and boost local economies in the hope of reducing regional disparities.
While successful to a certain extent, they haven't been able to tackle the root causes of inequality -- a lack of open market competition and uneven distribution of resources that allows the wealthy to prevent others from amassing wealth. As a new government prepares to take office, the challenges that await are not only bread-and-butter issues but also how to reduce economic and social disparity.
The new government has to depart from doling out financial help or using stimulus plans -- indeed there is nothing much left in the treasury for the usual cash splurge. If the government wants to fix wealth inequality, it needs to trust and empower its citizens to do it on their own two feet. There is no shortage of entrepreneurial spirit across the country, but it is usually stifled in one format or the other.
We've seen this play out in many sectors where a lack of government support or the law prevents the rise of small and medium-sized enterprises.
One example can be seen in the Move Forward Party's progressive liquor bill that promises to revamp the status quo that makes it nearly impossible for small players to enter the alcohol industry legally.
By easing licensing barriers that have long prevented small-scale producers from competing with large producers, the list of benefits is lengthy. They include lifting a shadow industry operating in the black market, boosting government coffers in the form of taxation, giving people more choices to buy the products they enjoy and creating a potentially new export market. All of this translates to more money for the government and people who may otherwise have been left behind.
Of course, actions are one way to overcome wealth inequality, but what's also needed is a change in mindset. Nations with low wealth inequality uphold the principle that every citizen should have access to the same quality of education, legal rights and social safety nets, and people who need help are not viewed in a bad light.
Fixing wealth inequality in Thailand mandates a long-term commitment to undo decades of damage. It requires evaluating the effectiveness of policies, and prioritising inclusivity in national development plans. By addressing both structural and attitude barriers, Thailand can pave the way for a more just and prosperous society.