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Essay on Thailand's Economy
Thailand is the only Southeast Asian country never to have been occupied by any European or other foreign power, except in war. The country was an absolute monarchy from 1782 until 1932, when rebels seized power in a coup and established a constitutional monarchy. Since then, Thailand has come under the rule of many governments, both civil and military. The country was known as Siam until 1939 (when it was renamed Thailand), and again for a few years in the late 1940s.
In 1949 the name Thailand was adopted a second time. The recent history of Thailand's economy is defined by more than a decade of sustained and rapid economic growth beginning in 1985, followed by a severe recession that started in late 1997. During the boom years, economic growth averaged more than 7 percent annually, one of the highest rates in the world. The crisis of 1997 and 1998 wiped out some of the gains of the boom and forced major adjustments in Thai industry and economic policy.
A lot of different factors contributed to the rapid growth of Thailand's economy. Low wages, policy reforms that opened the economy more to trade, and careful economic management resulted in low inflation and a stable exchange rate. These factors encouraged domestic savings and investment and made the Thai economy an ideal host for foreign investment. Foreign and domestic investment caused manufacturing to grow quickly, particularly in labor-intensive, export-oriented industries, such as those producing clothing, footwear, electronics, and consumer appliances.
These industries also benefited from a tremendous expansion in world trade during the 1980s. As industry expanded, many Thai people who previously had worked in agriculture began to work in manufacturing, slowing growth in the agriculture sector. Meanwhile, manufacturing growth spurred the expansion of service sector activities....
