Globalization and Liberalization Policies in Thailand - Coursework Example

Thailand Introduction (Thailand) Globalization and Liberalization policies adopted by most of the countries in the world have openedthe doors widely for the business people. Some countries may have lot of resources; but they may not have the expertise to exploit it. Such countries can invite foreign business entrepreneurs who have enough expertise in exploiting such unused wealth for mutual benefit. Globalization has immensely improved the business tie up between countries and many big corporate companies are now researching the business prospects in different countries. Thailand is an independent country situated at the centre of South East Asia. It borders with Laos and Myanmar at north, Laos and Cambodia at the east, Malaysia at the south Andaman Sea and Myanmar at the west. Thailand population is mainly a mixture of Thai, Chinese, and Malay origin. Most of the Thailand people are Buddhists and because of that the Thai culture is related to India and China mainly. Thailand is country which is having a reasonably good economy because of the tourism and export revenue. The current global economic crisis has least affected Thai economy. But the main problems with Thailand are the political unrest. This report is prepared in order to help my company in exploring the business prospects in Thailand Thailand Politics – Role of Monarch Thailand is one of the rarest countries in the world which follows constitutional monarchy with King Bhumibol Adulyadej as the supreme authority of the country. A constitutional monarchy is a form of government in which a King acts as head of state within a written or unwritten constitution. It differs from absolute monarchy with respect to the power. In absolute monarchy the king holds the supreme authority and functions independently without the barriers of a constitution. Though in constitutional monarchy countries, the King should honor the constitution, in Thailand, the King enjoys supreme power just like the king in an absolute monarchy country. Thailand Politics – At present Thailand politics has witnessed lot of conflicts after the constitution amendment in 2007. The main parties in the current conflict are the Prime Ministers Samak Sundaravej’s Peoples Power Party (PPP) and the opposition party Peoples Alliance for Democracy (PAD). PPP has won the recent general election conducted in December 2007 and tried to amend the 2007 constitution. In their opinion 2007 constitution was a dictatorial constitution. PAD was not ready to change the current 2007 constitution. They were afraid that the ruling PPP government has some hidden agenda in changing the constitution. Because of the severe resistance from the opposition PPP government was forced to cancel their plan; but the agitation still goes on demanding the resignation of the Prime Minister. 2007 Constitution Thailand constitution has revised in 2007. As per the new constitution, the prime minister should be an elected member of the parliament and moreover he can continue in the office for maximum two terms or 8 years. The new constitution was a controversial one and it has took out the authority of the prime minister to remain in power as caretaker after dissolving the parliament. “Under the 2007 constitution, the National Assembly consists of the House of Representatives (the lower house) and the Senate (the upper house). The 480 members of the lower house are directly elected (80 of them according to a system of proportional representation). The 150-member upper house is only partly elected, with 74 of its members appointed by a select committee” (Thailand-Political structure) Relationship with other countries Myanmar is a country which is often criticized by international community for the human right violations committed by the military junta there. People’s agitations have been suppressed using iron fist by the military regime in Myanmar. “Thailand’s relations with the US and the EU will remain troubled as a result of the Thai government’s unwillingness to criticise the ruling military junta in neighbouring Myanmar” (Thailand-Economic data) Thailand has border issues with Myanmar and the situation is tense also; still Thailand has kept a soft approach towards the military regime in Myanmar. Thailand has already closed its refugee camps on border with Myanmar which again resulted in international criticism. Cambodia also has strained relationship with Thailand. Apart from the political differences, US have some commercial disputes also with Thailand. Political Forecast-Thailand Thailand is a country which is often hit the headlines of news papers and other media because of the political unrest. People’s agitations are a common thing in Thailand though the Thai economy is comparatively in a good condition. The opposition leaders are exploiting the current global economic recess to make political advantage in Thailand. Thailand is politically a sensitive country which is vulnerable to even small political issues. It is easy for the Thai politicians to convert the people’s dissatisfaction into political agitations. Nobody thinks that Thailand political may become clam in the near future. Economy - Thailand Thailand economy mainly depends on tourism and export. Thailand is one of the major countries in the world which is a tourist’s paradise. The lengthy seashores, attractive beaches, luxurious hotels and hospitality industry etc are the main attraction for the tourists in Thailand. Prostitutes and sex workers are the landmark of Thailand and hence many tourists were attracted by that. Heavy industrialization made it possible for Thailand to export goods which are produced in excess there. Thailand economy has slightly affected by the current recess, but many economists believe that it is a temporary problem alone. But the political unrest in Thailand seems to be a long lasting one. Economists are optimistic about the economic forecast of Thailand. They believe that by 2010 the Thai economy may come back on track. The present deflation is also not going to be a long lasting one as per the economic experts. The GDP growth in Thailand also expected to be in full swing by 2011. In short the current economic problems believed to be last only for two more years and thereafter the economy may returns to its original growing path Pros and Cons of investing in Thailand Thai economy is based mainly on tourism and industry related exports and hence it is not possible to destabilize it easily. The natural beauty of Thailand may not vanish and hence tourism will definitely be continued as the major revenue source of Thailand amidst of the economic crunch. Moreover the trade policies were liberalized and the privatization process is in full swing in Thailand. Thailand has opened the doors for foreign direct investment widely in order to cater the needs of globalization. Thai government even amidst the political agitations were concentrating in attracting Foreign Direct Investment (FDI) which is a good sign for the foreign companies. Political unrest is the main barrier for investing in Thailand. Moreover bureaucracy in Thailand is not functioning well and because of that it is difficult to get the proper legal approval for business activities there. The tax structure for foreign organizations is comparatively high and the private ownership of companies is also regulated in Thailand. Energy crisis is another problem in Thailand. Electricity generating power sources are less in Thailand and hence the new organizations may face problems in getting proper energy in Thailand. Communication facilities like telephone and internet are also not developed much in Thailand. Many of the Thailand people are not well educated and hence the skilled labour availability is less in Thailand. Conclusions Though Thailand is an investor friendly country, the political situations are not good enough for investing in Thailand at present. In my opinion, our company needs to wait for some more time till the political agitations settle to think about investing in Thailand. Infrastructure facilities like power and communication equipments which are essential for industry development is lacking in Thailand. Moreover Thailand has strained relationship not only with the neighbours but international community as well. Wait and Watch approach seems to be the best option as far as investment in Thailand is concerned in my opinion. Works Cited 1. “Thailand”. 2009. Economist.com. 02 July 2009. Read More