Economic Policies
See also: ThaksinomicsThaksin's government designed its policies to appeal to the rural majority of voters, initiating programs such as village-managed microcredit development funds, low-interest agricultural loans, direct injections of cash into village development funds (the SML scheme), infrastructure development, and the One Tambon One Product (OTOP) rural small and medium enterprise development program.
Thaksinomics, Thaksin's economic policies helped to accelerate Thailand's economic recovery from the 1997 Asian financial crisis and reduced poverty. The GDP grew from THB 4.9 trillion at the end of 2001 to THB 7.1 trillion at the end of 2006. Thailand repaid its debts to the International Monetary Fund 2 years ahead of schedule. Between 2000 and 2004, income in the poorest part of the country, the Northeast, rose 40 per cent while nation-wide poverty fell from 21.3 per cent to 11.3 per cent. The Stock Exchange of Thailand outperformed other markets in the region. After facing fiscal deficits in 2001 and 2002, Thaksin balanced the national budget, producing comfortable fiscal surpluses for 2003 to 2005. Despite a massive program of infrastructure investments, a balanced budget was projected for 2007. Public sector debt fell from 57% of GDP in January 2001 to 41% in September 2006. Foreign exchange reserves doubled from US$30 billion in 2001 to US$64 billion in 2006.
However, critics charge that Thaksinomics was little more than a Keynesian-style economic stimulus policy re-branded as something new and revolutionary. Economists from the Thailand Development Research Institute argue that other factors, such as a revival in export demand, were the primary causes behind the economy's recovery. Others charge that the policies got the rural poor "hooked on Thaksin's hand-outs."
Thaksin helped bring part of Thailand's massive underground lottery system into the legal fold by operating a successful numbers game (Thai: หวย) run by the Government Lottery Office. Lottery sales of approx. 70 billion THB (2 billion USD) are used for social projects, including the "One District, One Scholarship" program which provided one student from a low-income family in each district with a scholarship to study overseas. Soon after Thaksin was deposed, the junta banned the lottery, claiming it was a social vice. This lured the poor away from work into gambling addiction. In addition, the Supreme Court ruled that the Cabinet did not have the right to introduce the lottery without due political process. The scholarship program was also stopped. The military junta also claimed that Thaksin's government "mischievously spent the proceeds in any way it saw fit".
The Thaksin government reduced the state's control of the media by privatizing MCOT, a large television and radio broadcaster.
After the 2006 coup, some of Thaksin's economic policies were ended. The OTOP program was rebranded, the Government Lottery Office program was deemed illegal. The government also nationalized several media outlets and energy companies.
Read more about this topic: Policies Of The Thaksin Administration
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