Publication Code: Y89B
by Narongchai Akrasanee
The 1980s will be recorded in Thai economic history as a decade of drastic economic change. In the early 1980s the country experienced a moderate rate of GDP growth, a large current account deficit, a rising debt-service ratio, and high inflation. The impact of the second oil shock and the commodity price slump was widely felt. Economic stability was attained in the mid-1980s through restrictive fiscal and monetary measures, but at the cost of low GDP growth which reached its lowest level--of 3.5 percent--in 1985. Finally, starting in 1986, the economy shifted into high gear, entering an era of very high GDP growth with financial strength, resulting mainly from booming exports, foreign investment, and tourism and reaching double-digit growth rates in 1988 and 1989. As a consequence, the economy has become much more internationalized with profound and wide-ranging effects on the economic activity and well-being of the Thai people.
This paper presents the work done on "Thailand in the International Economic Community," a research project carried out by a team of researchers at TDRI in 1989 (see Annex 1). The paper summarizes major issues, research findings, and strategy options as presented in individual reports. Part I discusses changes in the Thai economy during the 1980s as background to the report; Part II, the dynamism of the external sector of the Thai economy; Part III, research results on the impact of the external sector on various aspects of the Thai economy; and, finally, policy and strategy options are presented in Part IV.
December 1989