Localism in Thailand
|This article's factual accuracy may be compromised due to out-of-date information. (November 2012)|
The chief proponent of localism in Thailand or "moso" (moderation society) is King Bhumibol Adulyadej's philosophy of "sufficiency economy". The foundations of King Bhumibol's theory include sustainability, moderation, and broad-based development. The Learning Centre of King Bhumibol's Philosophy of Economic Sufficiency claim the concept is focused on living a moderate, self-dependent life without greed or overexploitation of, for example, natural resources.
According to the opinion expressed in a leaked top secret cable from the US ambassador in Thailand to the US Secretary of State, the tenets of sufficiency economy are "vague and malleable", its popularity due to a "public reluctance to criticize anything associated with the revered King."
After a coup d'état, the military junta claimed that the policies of deposed Prime Minister Thaksin Shinawatra were inconsistent with the king's philosophy. The preamble of the junta's new constitution stated that promotion of self-sufficiency was one of the fundamental roles of the state.
The junta-appointed Prime Minister Surayud Chulanont pledged to allocate 10 billion baht (almost US$300 million) for projects to promote well-being in line with King Bhumibol's sufficiency economy principle. He made the pledge while participating in King Bhumibol's 80th birthday celebrations.
In 2007, the Democrat Party-run Bangkok Metropolitan Administration gave away a million baht to each city community that joined the "Self-sufficiency Community Plan According to His Majesty the King’s Self-sufficiency Initiative."
Foreigners were, for the most part, left confused. After a meeting with Ministry of Finance officials where the need for more sufficiency was explained, Standard & Poor's director of sovereign ratings noted, "No one knows what [sufficiency economy] really means." The Asia Times noted that "There is a concurrent risk that the royal philosophy will be twisted by less scrupulous government officials as an opportunity to abuse their authority for rent-seeking and extortion, particularly among foreign-invested concerns". NGO activists hoping to use sufficiency economy theory to oppose the construction of large-scale dams were sharply criticized by Bhumibol, a long-time advocate of dam construction, who claimed that the deforestation caused by dams was a necessary evil to provide consistent energy and water sources for farmers.
"...The development of the country must be fostered in stages. It must start with the construction of infrastructure, that is, the provision of food and basic necessities for the people by methods which are economic, cautious and conforming with principles. Once the foundation is firmly established, progress can be continually, carefully and economically promoted. This approach will prevent incurring mistakes and failures, and lead to the certain and complete achievement of the objectives..."
The sufficiency economy is not a theory about how the economy of a country works, but rather a guide for making decisions that will produce outcomes that are beneficial to development. The National Economic and Social Development Board defines the philosophy as,
"Sufficiency Economy is a philosophy that stresses the middle path as an overriding principle for appropriate conduct by the populace at all levels. This applies to conduct starting from the level of families to communities and to the nation in terms of development and administration, so as to modernize in line with the forces of globalization. 'Sufficiency' means moderation, reasonableness, and the need for self-immunity to protect from impacts arising from internal and external change. To achieve sufficiency, an application of knowledge with due consideration and prudence is essential. In particular, great care is needed in the utilization of theories and methodologies for planning and implementation in every step. At the same time, it is essential to strengthen the moral fiber of the nation, so that everyone, particularly public officials, academics, and business people at all levels, adhere first and foremost to the principles of honesty and integrity. In addition, a way of life based on patience, perseverance, diligence, wisdom and prudence is indispensable in creating balance and in coping appropriately with critical challenges arising from extensive and rapid socioeconomic, environmental, and cultural changes in the world."
Criticism of the philosophy
There have been efforts by the military government to incorporate the king's sufficiency economy (localism) in national economic policy. Thai critics parroting talking points crafted by foreign corporate interests are generally careful to direct their criticisms towards the military rather than the king, out of fear of prosecution for lèse majesté. Consequently, criticisms are most often targeted at ineffective application rather than disagreement in principle. Nonetheless, common points of disagreement include:
- The philosophy is not consistent with the realities of Thailand's economic development
- Nobody understands what "sufficiency economy" really means and there are several vague interpretations
Translating philosophy into action
The governmental organisation most responsible for implementing the sufficiency economy is the National Economic and Social Development Board (NESDB). The NESDB's primary tool for mobilising action is the publication of the National Economic and Development Plan. The latest (eleventh) version of this plan covers the years 2012-2016.
Self-sufficiency economy (localism) offers the idea of limited production in order to protect the environment and conserve scarce resources. Production should be aimed at individual consumption; production in excess of consumption is to be solf. This gives rise to the problems according to the three conditions of the availability of resources: abundance, scarcity, and nonrenewable resources.
Scarce and nonrenewable resources
The philosophy emphasizes these two conditions of the availability of resources. The philosophy implies that resources and production are for individual consumption, and the excess of the consumption would be for sale.
Social class and resource consumption
The philosophy holds that the rich can consume as many resources as they like so long as their consumption does not incur debt, and that the poor should consume resources without borrowing.
Asia Times Online published an article that analyzes the Thai military junta government's economic policy that is fully influenced by the king's self-sufficient philosophy. The article notices the unexpected, rather bold step in Thailand economic development of the military junta government, endorsed by the king, that willingly responds to the king's philosophy. The article criticizes the philosophy as being so new as to have no academic grounding and no empirical basis. As a consequence, any misstep, whether improper interpretation of the philosophy as economic policy or the unaudited practices, would have caused the Thai economy's demise. The article claimed that the protectionism that the Thai government has used will discourage foreign investors and reduce short term cash flow from outside the country.
The article emphasizes the contradiction between capitalism and self-sufficient economics, which favors long-term economic alignment with what is environmentally friendly, this being the main principle of the philosophy, particularly in less-regulated markets. The Thai model of sustainability is slightly different than Western sustainable development models. In the Western concept of sustainable development, the force that drives the will to protect the environment comes from society's long-term needs. In the Thai model, the driving force comes from the basic human psychological state of need. This psychological state of need can be refined through a far-sighted government education of the public. The other name for localism in Thailand is called "Buddhist economics".
The philosophy has been demonstrated by Pridiyathorn Devakula, Thai Minister of Finance, who proclaims he is a supporter of the king's self-sufficiency economy, or localism. Examples of his policies that follow the king's philosophy of sufficiency economy are: limiting foreign company investments, a practice that enormously reduces the liquidity of the Thai economy; regulation and investigation of foreigners' sources of funds; and capital controls that allegedly destroyed US$20 billion of market value in one day. As a consequence of capital controls and investigations into foreign investors, the World Trade Organization (WTO) sent negative feedback to Thailand which cast doubt on the ability of Thailand to continue to be a WTO member. The prime minister Surayud Chulanont, who also proclaims the King's localism, has called for the former minister of commerce Somkid Jatusripitak, who is pro-capitalism, to return to the service of the country.
An article appearing in the Bangkok Post on 22 February 2007 noted that Somkid Jatusripitak, who had been the finance minister in the previous Thaksin-led government, resigned his new position as spokesman for the sufficiency economy within days of being appointed. His appointment to the position had been heavily criticized, and Mr. Somkid said that he resigned in order to prevent ongoing divisions in Thai society.
The Bangkok Post reported on 23 February 2007 that there is now discussion about whether the committee drafting the new constitution should include language defining Thailand's economic policy. The previous constitution, drafted in 1997, had identified capitalism and free markets as the Thai economic philosophy.
One example of the Thai government's application of the self-sufficient philosophy is in promoting the use of local currency. The use of "Bea-Kud-Shum" as a local currency in specific parts of rural Thailand was endorsed by the Thai government in August 2006, in spite of the fact that the use of this currency instead of the standard Thai baht had been deemed illegal previous to this. This example also shows the difficulties of applying the philosophy, in that by using local currency such as "Bea-Kud-Shum", the currency itself is exempted from tax collection and can therefore interfere with the tax system.
Professor Kevin Hewison, Director of the Carolina Asia Center at the University of North Carolina, is critical of sufficiency economy. He has written that, "Sufficiency Economy is essentially about keeping the poor in their place. The people and organisations that promote SE are a wonderfully contradictory lot. The king, promoting moderation, sits at the head of a family and institutional wealth that is huge, based on land ownership and large capitalist corporations. The Crown Property Bureau’s known institutional wealth is estimated more than US$40 billion.... Prime Minister Surayud spends considerable time talking up SE and his government has made huge budget allocations to SE activities. Meanwhile, Surayud has declared collections of luxury cars and watches and expensive homes, despite having been on a relatively low military salary his entire career. The contradictions are massive. For the wealthy, SE means that they can enjoy their wealth so long as they do so within their means. For the poor, the advice is to make do. In class terms, SE becomes an ideology to justify inequalities.
The Asian Times's article "the King's 'Sufficiency Economy' (Localism)" may be misunderstood. "Sufficiency Economy" calls for partial localism - a quarter - not the whole. In other words, "sufficiency economy" is meant to be "partial" localism. It is true that many parts of Thailand still enjoy capitalism. "Sufficiency Economy" calls on those to practice "some" localism particularly those in the rural areas. However, the oppositions see no difference between "Sufficiency Economy" and "Self-sufficient economy", i.e., they are the same as localism. Kevin Hewison describes the self-sufficient political agenda in Thailand as Populist Localism.
Self-sufficiency as a political agenda in Thailand
Self-sufficiency is being strengthened through the link between nationalism and the king. Criticism over the king's philosophy would be a demonstration that the critics do not respect the King. The philosophy itself is often portrayed as a national barrier that guards Thailand from evil foreign, greedy, scheming capitalists.
After the ousting of former Prime Minister Thaksin, the Thai government under the Prime Minister Surayut began a political campaign that under King Bhumibol's localism is the new Utopia. Thus, localism is used as a political tool to counter Thaksin's proposal of Thaksinomics. The king's philosophy had been introduced to Thailand before Thaksin was prime minister. In fact, for the celebration of King Bhumibol Diamond Jubilee, Thaksin's government organized public exhibitions commemorating the event, one of the major exhibitions being sufficiency economy.
- Embassy of the United States Bangkok, Thailand, 06BANGKOK5706 WHAT IS THE "SUFFICIENCY ECONOMY"?, 15 Sep 2006
- "Rebranding Thaksinomics", The Economist, 11 Jan 2007
- Asia Times, In Thailand, a return to 'sufficiency', 5 Oct 2006
- "PM earmarks B10bn for well-being", Bangkok Post, 10 Mar 2007
- "Sufficiency Economy: Implications and Applications" (PDF). NESDB. Retrieved 6 May 2010.
- "The Eleventh National Economic and Social Development Plan (2012-2016)" (PDF). National Economic and Social Development Board. Retrieved 2015-02-06.
- Crispin, Shawn W (2007-02-02). "Thailand's New Economic Logic". Asia Times. Retrieved 2015-02-06.
- Wehrfritz, George (2007-01-02). "Buddhist Economics". Newsweek International. Retrieved 2015-02-06.[dead link]
- "WTO Doubts Thailand". Prachachat. 2007-04-19. Retrieved 2015-02-06.[dead link]
- "Bea-Kud-Chum As a New Currency". Prachachat. 2007-02-15.[dead link]
- Farrelly, Nicholas (2007-08-20). "Interview with Professor Kevin Hewison – Part Two". New Mandala. Retrieved 2015-02-06.
- Hewison, Kevin (Sep 1999). "Localism in Thailand: a Study of Globalisation and its Discontents" (PDF). University of Warwick. Retrieved 2015-02-06.