Many skeletons of buildings abandoned during the 1997-98 Thailand crisis are slowly disintegrating in the tropical humidity of Bangkok, symbols of an economy then on the verge of disaster. A few minutes from the de luxurious Oriental Hotel on the banks of the Chao Praya River in Bangkok, a 30-storey concrete shell dominates the Thai horizon. But no one pays any attention to it, or the dozens of other concrete skeletons across Bangkok. These unwanted reminders of the crisis have been consigned to the past and giant cranes have appeared next to the unfinished buildings.
Thailand has avoided the worst: and a return third-world status did not happen. The social situation in Thailand remains difficult, but the Thai economy has revived: the country that seemed condemned to years of stagnation or a long depression, witnessing new growth levels of an estimated 6% for 2003.
In August 2003, thanks to a rapid rebuilding of its reserves, Thailand paid back its debt to the IMF a year early, an achievement celebrated by the PM Thaksin Shinawatra, who said: "Never again will Thailand fall prey to the forces of foreign capital."
This economic nationalism of Thailand may seem surprising for a conservative country that not so long ago was set as the example of liberalization in Asia.
The government of Thailand has made deliberate and partially successful efforts to free itself from external constraint by a boosting domestic demand, protecting it's strategic industries and encouraging Thai domestic enterprise. Thailand has been very successful in retaining control of the energy, transport and telecommunications sectors, after signing a protocol with the IMF in the year 1998 for full or partial privatization by 1999. Four years later no key sectors in Thailand have been privatized.
The long-term challenge for the country is to reduce Thailand's structural dependence on exports of a narrow range of products, especially information and communication technology components and to diversify the economy plus boost more the Thai domestic income and consumption. The economic struggle in Thailand has in reality just begun.
By Philip S Golub
