Continued delays in the formation of Thailand’s next government are posing risks to the country’s economy, says Pavida Pananond, a professor of international business strategy at the Thammasat Business School of Thammasat University in Bangkok
- The ongoing delays in forming Thailand’s government pose risks to the economy, hindering its potential for growth and competitiveness.
- Thailand’s political instability and manipulation of legal avenues deter foreign investors and hinder the country’s economic performance.
- The lack of effective institutional governance and transparency in Thailand’s business environment prevents the country from attracting higher value-added investment and realizing its full economic potential.
Thailand has been a regional underperformer since a military coup in 2014, with growth hovering around 3%, as the concentration of wealth in the hands of a few powerful families has stifled competition and innovation.
The reformist Move Forward Party had promised to address these issues but was unable to form a government due to the military-appointed Senate.
This political deadlock is hurting business and investor confidence, leading to a decline in foreign investment. Multinationals are bypassing Thailand in favour of other Southeast Asian countries like Malaysia and Vietnam. Thailand’s lack of effective investment policies and an innovation-driven economy are hindering its potential.
Good governance and transparency are crucial for attracting foreign direct investment. The ongoing political wrangling and repression are causing economic stagnation and a lack of creativity and innovation. Thailand needs an accountable government that can implement reforms and restore investor confidence.