NESDC counters World Bank, insists Thailand’s poverty situation has improved
The National Economic and Social Development Council (NESDC) on Thursday argued that Thailand’s poverty rate had improved contrary to a recent World Bank report.
NESDC secretary-general Danucha Pichayanan said Thailand’s poverty rate declined from 6.83 per cent in 2020 to 6.32 per cent in 2021 and the number of poor people fell from 4.7 million in 2020 to 4.4 million.
Danucha was responding to a World Bank report titled “Thailand Rural Income Diagnostic: Challenges and Opportunities for Rural Farmers”, which was issued on October 20.
The report stated that from 2015, Thailand’s progress in poverty reduction slowed down and poverty actually rose in 2016, 2018 and 2020 because of a slowing economy, stagnating farm and business incomes and the Covid-19 pandemic.
“In 2020, the poverty rate was over 3 percentage points higher in rural areas than in urban zones and the rural poor outnumbered urban poor by almost 2.3 million,” the report says.
“The majority of the poor (79 per cent) live in rural areas, mainly in agricultural households.”
Danucha explained that the Covid-19 crisis caused the Thai economy to severely contract at the rate of 6.2 per cent in 2020, causing the number of unemployed workers to rise to 650,000.
He said the unemployment rate in 2020 increased by 74.4 per cent from the previous year, while economic contraction caused the poverty rate in 2020 to rise to 6.83 per cent, compared to 6.26 per cent in 2019 when the number of the poor was 4.3 million.
The World Bank report also stated that the distribution of poverty was uneven across geographic regions, with the poverty rate in the South and Northeast almost double the national level.
“In 2019, the average monthly income of rural households was around 68 per cent of urban households,” the report went on to state.
“Rural households in the Northern region have the lowest average income.”
He also noted that in 2020, the farming sector benefited from the rising prices of agricultural crops, allowing farmers to have increased income.
Meanwhile, the prices of farm products rose by 6.05 per cent in 2020, allowing farmers to have higher income at an average rate of 2.27 per cent, Danucha said.
According to him, per capita income between 2019 and 2020 showed that people in rural areas saw their income increase more than those living in urban areas.
In 2019, the average income for rural people was about 7,588 baht per head per month and rose to 8,130 baht, a 7.14 per cent increase, Danucha pointed out.
He said the average income of urban people was 11,712 baht per head per month in 2019, and this rose to 12,018 baht in 2021, a 2.61 per cent increase.
The poverty rate by region in 2021 showed that the South had the highest poverty rate of 11.6 per cent with 1.1 million poor people, followed by the Northeast (11.5%), North (6.84%), Central (3.24%) and Bangkok (0.49%).
The World Bank report also stated that with an income Gini coefficient of 43.3 per cent in 2019, Thailand had the highest income inequality level in East Asia.
Danucha said Thailand’s income Gini coefficient was on the downtrend but he admitted that the impact from the Covid crisis caused the rate to rise from 0.429 in 2020 to 0.430 in 2021.
He said after Thailand’s economy slowed to 2.2 per cent growth in 2019, compared to 4.2 per cent the previous year, the Thai government has been using several stimulus measures to revive the economy.
The measures helped the economy expand by 1.5 per cent in 2021, compared to a 6.2 per cent contraction in 2020, and the unemployment rate in the fourth quarter of 2021 fell to 1.6 per cent compared to 1.9 per cent in the same period of the previous year.
The driving force of the economic revival in 2021 helped the economy expand by 2.3 per cent in the first quarter of this year and 2.5 per cent in the second quarter, while the unemployment rate in the second quarter of this year dropped to 1.4 per cent, the lowest since the Covid pandemic, Danucha added.
