After months of jostling and wrangling, Srettha Thavisin of the Pheu Thai Party assumed the title of 30th Prime Minister of Thailand last week. After nine years under Gen Prayut Chan-o-cha, Mr Srettha, a successful businessman representing a civilian elected government, heralds a new era of hope and belief that he can be the man to steer the ship straight and fix the structural issues that have long plagued the country.
Mr Srettha has yet to be sworn in and Pheu Thai still has to present its agenda on development and governance to parliament as required by the charter, which will most likely happen in September.
However, details of the party's immediate priorities are already well-known: 1) a 10,000 baht digital handout to every Thai aged 16 and older by next year; 2) a minimum wage of 600 baht a day; 3) a minimum salary of 25,000 baht for people with bachelor's degrees and 4) an increase in the average farmer's income to 30,000 baht, all by 2027.
Understandably, a focus on raising people's standard of living and policies to stimulate the economy should take precedence and are necessary to boost the confidence of investors and the people, but the new government must gives credence to the double whammy that is a declining birthrate and an ageing society -- an issue which has been off the radar and a second tier priority for too long.
For many years now, warning bells have been ringing about how Thailand is on the fast-track to becoming a super-aged society -- when 20% or more of a population is over the age of 65 and yet there is no real action plan or taskforce to tackle this issue.
According to the World Health Organization, Thailand is one of the fastest ageing societies in the world, with 12 million of its 71.6 million citizens already over 60. This trend is only expected to accelerate.
Compounding the problem further, the country's fertility rate has drastically dropped from 2.2 births per woman in 1991 to just 1.1 in 2021, well below the 2.1 births needed for a population to replace itself.
At this rate, the share of elderly people will keep increasing. Thailand's population is on course to shrink by at least 50% by 2100, according to the Social Development and Human Security Ministry. Many have attributed this to changes in societal norms, with a focus on smaller families and technology replacing people's needs for physical social interaction. This isn't necessarily a bad thing if a country plans for this shift and defines how it plans to grow with this change.
Generally, an ageing society coupled with low birth rates and no other means to replace the workforce presents many challenges, in terms of higher healthcare costs and strained pension systems. It also translates to a shortage of skilled workers which can dissuade innovation and technological advancements and slow down or kill economic growth. And a stagnant economy means no improvements in standard of living, and loss in global competitiveness which will sting in a region where competition for foreign investment is fierce.
Instead of bucking the problem down the road, the Pheu Thai led-government and the new prime minister should come up with a roadmap on how to lessen the impact of what's coming.
Previously, the party pledged to provide better benefits to new parents with childbirth allowances, longer maternal leave and generous child support subsidies. It also promised to help couples foot the bill for reproductive technology to address infertility. Currently, parents have the right to 90 days of paternity/maternity leave, to get a payment of 13,000 baht per birth and tax benefits. These should all be increased to support parents who want children, but are unable to have them due to financial constraints or concerns about balancing work and caring for newborns.
Besides policies that aim to raise the birthrate, the government also needs to explore how to create family planning programmes that incentivise young people to have children. Another option, though always controversial, is bringing in more foreign professionals to address labour shortages. Many foreigners already live, work and contribute to the kingdom so including them into the system formally could help.
With many tasks requiring his attention, the new prime minister has a heavy burden. It is hoped that as CEO he will be able to prioritise accordingly. Otherwise all the investments being made into mega structures, extensive public transit systems and more meant to serve a burgeoning population, who will it be for?