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Thailand - Overview

Contents extracted from the comprehensive atlas of international trade by Export Entreprises

Introduction

Capital:: Bangkok
Area:: 513 km2
Total Population:: 67.764
Annual growth rate:: 1.00%
Density:: 133.00/km2
Urban population:: 34%
Population of Bangkok (8.750), Samut Prakan (390), Nonthanburi (300), Udon Thani (250), Nakhon Ratchasima (210)
Official language: Thai
Other languages spoken: English is a second language taught in most schools . However it may be difficult to find people able to speak English as only 28 % of the population reach the secondary level at school. Chinese is also often used.
Business language: Thai and English.
Ethnic Origins:: Although 75% of the population are classified as Thai, the country has a complex ethnic composition. The Thai themselves vary considerably, with those of the central plain differing markedly in culture and language from those of the north and northeast, known as the Lao. Many Thai have some Chinese ancestry, and Chinese constitute the largest single minority group in the country (14%).
Beliefs: 95% of Thais are Buddhists of the Theravada tradition. Muslims are the second largest religious group in Thailand at 4.5%. Thailand's southernmost provinces - Pattani, Yala, Narathiwat and part of Songkhla Chumphon have dominant Muslim populations, consisting of both ethnic Thai and Malay. Most often Muslims live in separate communities from non-Muslims.
Telephone codes:
To make a call from: 1
To make a call to: +66
Internet suffix:: .th
Type of State::
Thailand is a Kingdom. It is a constitutional monarchy based on parliamentary democracy.
Type of economy::
Lower-middle-income economy, Emerging Financial Market.
One of the most successful economies of South East Asia; economy based on the agri-food production, tourism, production of automotive and exports of electronic products

Economic overview

Thailand is Southeast Asia's second largest economy (behind Indonesia), and 4th richest nation, according to per capita GDP, after Singapore, Brunei and Malaysia. It functions as an anchor economy for the neighboring developing countries like Laos, Burma, and Cambodia. Due to its openness to foreign trade, the country was hit hard by the international financial crisis and entered into a recession in 2009 (-2.2%) for the first time since the Asian crisis of 1997-98. Estimated at 7.5%, there was a quick and dynamic growth in 2010, driven by the resumption of international trade, household incentives and investment projects (infrastructure).

With the recovery under way, the authorities will eliminate fiscal and monetary incentive measures adopted in order to combat the crisis. The country was also involved in a stimulus program called “Thailand: Investing for strength”. This program will go on until 2012, with a budget of around 30 billion euros, which should allow for the creation of about 1.5 million jobs and stimulate private consumption. Mid-term, the government is looking to strengthen infrastructure and develop the finance sector, in order to ensure a dynamic and sustainable recovery.
Significant progress has been made in terms of development: poverty has decreased sharply during the last decades. In spite of the crisis’ impact on the country, unemployment rate has remained low (1.4%).

Main industries

The Thai economy is heavily based on agriculture, which contributes around 10% of the GDP and employs almost 40% of the active population. The country is one of the leading producers and exporters of rice and also has rubber, sugar, corn, jute, cotton and tobacco as major crops. Fishing is an important activity as Thailand is a major exporter of farmed shrimp. However, agriculture's contribution to the GDP has relatively declined, while the exports of goods and services has increased.

The manufacturing sector accounts for just under half of the GDP and is well diversified. The main Thai industries are electronics, steel and automotive. Thailand is an assembly hub for international car brands. Electrical components and appliances, computers, cement production, furniture and plastic products are also important sectors. The textile sector employs around 25% of the active population but is no longer as dynamic as tourism which has become the main source of foreign exchange.

The tertiary sector, including tourism and financial services, contributes about half of the GDP.

Foreign trade overview

Thailand is an emerging economy, very dependent on exports, which account for more than two-thirds of the GDP. Thailand is very open to international trade (trade represented on average almost 140% of the GDP in 2007-2009) and is an active member of ASEAN. The country's three main export partners are: the United States, Japan and China. Main export commodities are electric and electronic equipment, machinery, vehicles, rubber, and plastics. The main import partners are: Japan, ASEAN, China, the EU and the United States. Thailand mainly imports electric and electronic equipment, mineral fuels and oil, machinery, iron and steel, and plastics. Thailand shows a trade surplus, a trend which should continue.

FDI

Foreign direct investment has been an important element of Thailand's economic development process. The immense foreign currency influx after Thailand's financial liberalization in 1990, helped to increase the country's competitiveness. In the context of the recession and relatively slow recovery after the 1997 crisis, the FDI's role became even more crucial in helping re-capitalize failing industries, bring in new technologies, generate or save jobs, assist with policy reforms and play a role in addressing the poverty and social inequalities challenges.

Thailand is an important FDI destination. In terms of investment, the country offers an attractive and modern legal framework and its economy benefits form the regional dynamism. In 2009, Thailand ranked amongst the first destinations for FDI and was the second ASEAN (Association of the Nations of the Southeast Asia) country, after Singapore, in terms of FDI stock. However, due to the US financial turmoil and the slowing of the global economy, as well as the country’s own political instability, the FDI influx dried up in 2008-2009. They should continue their recovery which began in 2010.

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