Yingluck Shinawatra: An Emerging Markets Paradox?

Screen Shot 2013-05-02 at 12.20.54One of the most impressive and downright profound articles anywhere to be found in The Economist in 2013 is that authored by telegenic Yingluck Shinawatra, the present prime minister of Thailand. In Connect more than the dots, Shinawatra, whose broadly populist Pheu Thai Party (‘Pro Thai Party’) ascended to power just three years after its 2008 inception, shows herself to be a thinker of some vision. Moving beyond the predictable themes of greater integration within the ASEAN bloc and economic triumphalism, the Kentucky State University alumnus underscores the importance of a sustainable form of capitalism where even the poorest have a genuine stake in society.

Politicians are not of course omnicompetent, and it would be harsh to judge Shinawatra by the practical implementation of her ideals barely eighteen months after she first assumed office. But within this context, we at Mediolana cannot help thinking about the Siam Center, a shopping colosseum profiled in the April 2013 edition of the redoubtable Monocle magazine. This mall of malls, located in the Pathum Wan neighbourhood of Bangkok, recently underwent a €45m facelift to coincide with its fortieth anniversary. And this makeover seems to have been successful, with more than 200,000 visitors coming through its doors every weekend day.

The revamped Siam Center is in many ways highly representative of the changes taking place within Thailand’s economy and society -and herein lies the problem. In a country where recent legislation to boost the minimum wage to ฿300 or €7.75 per day hauled pay up by as much as 40%, affluent consumers are spending several times this amount on ice-cream in a 400 outlet temple to consumerism. This rich-poor chasm would be problematic at the best of times, but in the context of sustainability and equity as being emblematic of the ‘ASEAN Way’, it is severely undermining what should otherwise be a compelling and necessary message.

There is an ever-broadening consensus that business (and more broadly, economics) as usual is no longer enough; seeing the example of post-development nations such as Japan, it is evident that we already know the ending of certain societal models. The Shinawatra/Siam Center dichotomy illustrates the challenge that many emerging markets with superb ideas and great prospects will face in the forthcoming years: realising their visions.

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2 Comments

Filed under Business, Economic Development, Economics, Politics

2 responses to “Yingluck Shinawatra: An Emerging Markets Paradox?

  1. The elite and powerful in any country are very selfish and are quite ruthless in defending their interests. Their purpose is to get richer, and it’s a real battle for anyone to get in their way. Ms Shinawatra is probably incapable of doing much about that, even if she wants to.

    • Like in many countries, inequality is hobbling an economy of real potential: Thailand’s public debt is a mere 43.3% of GDP and it has the best part of US$200bn in foreign exchange reserves. Ironically at least some of the rich in Thailand do actually seem to support populist policies which may improve the lot of the majority, but things could be so much better.

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