BOT governor urges new economic growth standards

Speaking at a seminar titled "Big Heart, Big Impact: Creating Opportunities for Small People: Power of Partnership, Hand in Hand", organised by Thai Publica, BOT governor Sethaput Suthiwartnarueput emphasised that Thailand must develop new growth models distinct from its past approaches.

"Thailand's economic growth should not be 'hunting' for GDP, but should reflect the wealth of households," the governor said.

He highlighted the importance of creating growth from within, promoting "localism" as a new driving force for Thailand's development.

Sethaput noted that Thailand's economic growth in recent years has not adequately reflected the improvement in living standards for many households. He warned that future growth rates are likely to slow down, further emphasising the need to focus on household income and wealth rather than solely on GDP figures.

 He then outlined several key issues facing Thailand's economy:

• Over the past decade, GDP growth has not adequately reflected household wealth or income.
• The business sector shows high concentration, with 5% of large businesses accounting for nearly 90% of revenue, up from 84-85% previously. This concentration has contributed to an increase in business closures and a decline in business dynamism.
• Thailand can no longer rely on foreign direct investment as it once did, with neighbouring countries like Vietnam now attracting more FDI.

"The changing global economic landscape and the need for Thailand to become more self-reliant signal that Thailand can no longer rely solely on foreign investment and must instead focus on its domestic strengths," he noted. 

Sethaput called for a shift towards more sustainable and inclusive growth, focusing on improving people's livelihoods and quality of life. He emphasised the importance of local growth, noting that 80% of Thailand's population lives outside the Bangkok Metropolitan area.

"The numbers that must be pursued are people's livelihoods, incomes, and wealth, which reflect the quality of people's lives, such as public health, education, and opportunities," he said.

To promote local growth, Sethaput suggested several strategies:

• Create competitive local economies: Encourage local businesses to compete at a global level.
• Leverage local strengths: Identify and capitalise on the unique strengths and resources of each region.
• Foster partnerships: Promote collaboration between businesses of all sizes to create win-win opportunities.
• Develop secondary cities: Invest in infrastructure and amenities to attract businesses and talent to secondary cities.
• Empower local communities: Grant local communities greater autonomy in decision-making and resource management.

The governor cited the example of Jeju Island in South Korea, where localised policies led to a tenfold increase in per capita income from US$1,500.
 

As Thailand grapples with changing global dynamics and internal economic challenges, he emphasised that Thailand requires a new growth model focused on local strengths and sustainability marks a significant shift in the country's economic strategy. 

The success of a comprehensive approach to local development and the creation of a stronger and more resilient economy will be dependent on effective implementation and collaboration among government, businesses, and local communities, he concluded.