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

Key Takeaways

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 economic costs of shoddy politics are incalculable for a country that was once Southeast Asia’s star performer
Pavida Pananond, a professor of international business strategy at the Thammasat Business School of Thammasat University in Bangkok from Business is out of patience with Thailand’s political mess – Nikkei Asia

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.