Thailand scores well in latest WEF and ASEAN rankings
Thailand’s inclusive growth and corporate governance received high marks last week in the latest reports issued by the World Economic Forum and the Association of Southeast Asian Nations (ASEAN), as the foreign and local business communities said they appreciated the Kingdom’s stability and were unperturbed by the recent rejection of the draft constitution.
Thailand scored high in services, infrastructure and education in the World Economic Forum’s “Inclusive Growth and Development Report 2015,’’ released last week. The report focuses on middle-income economies, examining 112 countries. The Forum said the report sheds light on how policy incentives and institutional mechanisms can make economic growth more socially inclusive without dampening incentives to work, save and invest.
Out of 38 lower-middle income economies, Thailand ranked first on financial intermediation of real economy investment; third on education and skills; fourth on basic service and infrastructure; ninth on employment and labor compensation; eighth on asset building and entrepreneurship, and fourteenth on fiscal transfers (tax code and social protection).
The Kingdom was less impressive on corruption and rents, finishing in 23rd place. The category includes sub-criteria such as business and political ethics, measures to combat corruption and bribery, concentration of rents, extent of market dominance, intensity of local competition, and concentration of banking sector.
Rick Samans, a member of the Managing Board of the Forum, said all countries had room for improvement.
It would be difficult to improve, however, on Thailand’s performance on the ASEAN Corporate Governance Scorecard, as the Kingdom finished first among the 10 nations for the third consecutive year. The scorecard was developed by the Asian Development Bank and the ASEAN Capital Markets Forum.
The average score of Thailand’s 100 largest market capitalization companies was at 84.5 in 2014, up sharply from 75.4 in 2013. Scores in all areas showed improvement, especially the Role of Stakeholders and Board Responsibilities, which surged 315 percent and 25 percent, respectively.
Meanwhile, foreign chambers of commerce and domestic Thai business associations expressed confidence in the Kingdom’s stability and continuity last week, saying they were unperturbed by the rejection of a draft constitution by the National Reform Council two weeks ago. The rejection means a new draft must be written, and national elections will be delayed by about seven months.
Darren Buckley, president of the American Chamber of Commerce in Thailand, said it was for the Thai people to decide upon the charter, but the international community still wanted to see the military government follow its road map of returning democracy to Thailand.
“In terms of the economy, foreign investors and the international community hope that the stimulus measures of the new Council of Economic Ministers will be able to revive economic growth in the next period,” he said.
Domestic business associations said that they believed the charter issue would not have any significant effect upon the economy. “We don’t think this issue will have much of an impact on industry,” said Supant Mongkolsuthree, chairman of the Federation of Thai Industries.
Isara Vongkusolkit, chairman of Thai Chamber of Commerce, said the economy would continue moving forward, despite the failure of the draft to pass.
Thailand Focus September 14, 2015
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