Localism in Thailand
Encyclopedia
The chief proponent of localism in Thailand
or moso (Moderation society) is King Bhumibol Adulyadej
's "the philosophy of Sufficiency Economy". The foundations of King Bhumibol's theory included sustainability, moderation and broad-based development. The Learning Centre of King Bhumibol’s Philosophy of Economic Sufficiency claimed the concept focused on living a moderate, self-dependent life without greed or overexploitation
of, for example, natural resources.
After a coup d'état, the military junta claimed that the policies of deposed Prime Minister Thaksin Shinawatra
, were inconsistent with the theory. The preamble of the junta's new constitution stated that promotion of self-sufficiency was one of the fundamental roles of the state.
The Junta-appointed Prime Minister Surayud Chulanont
pledged to allocate 10 billion baht (almost US$300 million) for projects to promote well-being in line with King Bhumibol's sufficiency economy principle. He made the pledge while participating in King Bhumibol's 80th birthday celebrations.
In 2007, the Democrat Party
-run Bangkok Metropolitan Administration gave away a million baht to each city community that joined the ”Self-sufficiency Community Plan According to His Majesty the King’s Self-sufficiency Initiative.”
Foreigners were for the most part left confused. After a meeting with Ministry of Finance officials where the need for more sufficiency was explained, Standard & Poor's
director of sovereign ratings noted, "No one knows what [sufficiency economy] really means." The Asia Times noted that, "There is a concurrent risk that the royal philosophy will be twisted by less scrupulous government officials as an opportunity to abuse their authority for rent-seeking and extortion, particularly among foreign-invested concerns".
about how the economy of a country works, but rather a guide
to making decisions that will produce outcomes that are beneficial to development. Also, The NESDB
has the definition of the philosophy
that - Sufficiency Economy is a philosophy
that stresses the middle path as an overriding principle for appropriate conduct by the populace at all levels. This applies to conduct starting from the level of the families, communities, as well as the level of nation in development
and administration
so as to modernize in line with the forces of globalization
. “Sufficiency” means moderation
, reasonableness, and the need of self-immunity for sufficient protection from impact arising from internal and external changes. To achieve this, an application of knowledge with due consideration
and prudence
is essential. In particular great care is needed in the utilization
of theories and methodologies for planning and implementation in every step. At the same time, it is essential to strengthen the moral
fibre of the nation, so that everyone, particularly public officials, academics, businessmen at all bevels, adheres first and foremost to the principles of honesty
and integrity
. In addition, a way of life based on patience, perseverance, diligence, wisdom and prudence is indispensable to create balance and be able to cope appropriately with critical challenges arising from extensive and rapid socioeconomic, environmental
, and cultural changes in the world.
. Consequently, such criticism is often phrased as inneffective application rather than disagreement in principle. Nonetheless, common points of disagreement include:
For example, the philosophy states that one must consider the investment at low risk, avoid the investment that possess the potential of over-finance. This idea is not new, but has already been in the financial textbook (close to the concepts in finance: Liquid ratio, acid ratio, debt-capitol ratio, etc.).
The article emphasizes the contradiction between capitalism and self-sufficient economy, which it favor the long-term economic alignment and environmental friendly, that are the main principles in the philosophy, particularly in lowly-regulated market. The Thai model of sustainability is slightly different to western sustainable development. In the western concept of sustainable development, the force that drives the will to save the environment comes from corporations' need. In the Thai model, the driving force comes from basic human psychological state of need. This psychological state of need comes from long government education of the public. The other name for localism in Thailand is called "Buddhist Economics" .
The philosophy has been made corporeal by Pridiyathorn Devakula
, Minister of Finance, who proclaims he is the supporter of the King's self-sufficiency economy or Localism. The examples of his policies that follow the King's localism are: Limiting foreign companies investments that enormously reduce liquidity in Thai economy; regulation and investigation of foreigners' source of fund; and Capital controls that destroyed US$20 billion of market value in one day. As a consequence of capital control and investigation over foreign investors, World Trade Organization (WTO) sent negative feedback to Thailand and doubts the ability of Thailand to continue to be the WTO member . The prime minister Surayud Chulanont
, who also proclaims the King's localism, has called for the former minister of commerce Somkid Jatusripitak
, who are pro-capitalism, to the service of the country.
Articles appearing in the Bangkok Post on 22 February 2007 noted that Somkid Jatusripitak, who had been the finance minister in the previous Thaksin-led government, resigned his new position as spokesman for the sufficiency economy within days of being appointed. His appointment to the position had been heavily criticized, and Mr. Somkid said that he resigned in order to prevent ongoing divisions in Thai society.
The Bangkok Post reported on 23 February 2007 that there is now discussion about whether the committee drafting the new constitution should include language defining Thailand's economic policy. The previous constitution, drafted in 1997, had identified capitalism and free markets as the Thai economic philosophy.
The government has made the King's self-sufficient philosophy corporeal by promote the use of local currency, for example. The use of "Bea-Kud-Shum", as a local currency in specific part in rural Thailand, has been endorsed by the Thai government in August 2006. However, the use of currency instead of 'Baht' had been deemed illegal before. By using local currency such as "Bea-Kud-Shum", the currency itself is exempted from tax collection and can interfere with tax system.
After the ousting of former Prime Minister Thaksin, the Thai government under the Prime Minister Surayut began a political campaign that under King Bhumibol's Localism is the new Utopia
. Thus, Localism is used as a political tool to counter Thaksin's proposal of Thaksinomics. The King's philosophy had been introduced to Thailand before Thaksin was prime minister. In fact, for the celebration of King Bhumibol Diamond Jubilee
, Thaksin's government organized public exhibitions commemorating the event, one of the major exhibitions being sufficiency economy.
Thailand
Thailand , officially the Kingdom of Thailand , formerly known as Siam , is a country located at the centre of the Indochina peninsula and Southeast Asia. It is bordered to the north by Burma and Laos, to the east by Laos and Cambodia, to the south by the Gulf of Thailand and Malaysia, and to the...
or moso (Moderation society) is King Bhumibol Adulyadej
Bhumibol Adulyadej
Bhumibol Adulyadej is the current King of Thailand. He is known as Rama IX...
's "the philosophy of Sufficiency Economy". The foundations of King Bhumibol's theory included sustainability, moderation and broad-based development. The Learning Centre of King Bhumibol’s Philosophy of Economic Sufficiency claimed the concept focused on living a moderate, self-dependent life without greed or overexploitation
Overexploitation
Overexploitation, also called overharvesting, refers to harvesting a renewable resource to the point of diminishing returns. Sustained overexploitation can lead to the destruction of the resource...
of, for example, natural resources.
After a coup d'état, the military junta claimed that the policies of deposed Prime Minister Thaksin Shinawatra
Thaksin Shinawatra
Thaksin Shinawatra is a Thai businessman and politician, who was Prime Minister of Thailand from 2001 to 2006, when he was overthrown in a military coup....
, were inconsistent with the theory. The preamble of the junta's new constitution stated that promotion of self-sufficiency was one of the fundamental roles of the state.
The Junta-appointed Prime Minister Surayud Chulanont
Surayud Chulanont
General Surayud Chulanont is a Thai political figure. He was the Prime Minister of Thailand and head of Thailand's Interim Government between 2006 and 2008...
pledged to allocate 10 billion baht (almost US$300 million) for projects to promote well-being in line with King Bhumibol's sufficiency economy principle. He made the pledge while participating in King Bhumibol's 80th birthday celebrations.
In 2007, the Democrat Party
Democrat Party (Thailand)
The Democrat Party is Thailand's oldest political party and was the main coalition government party of the 23rd House of Representatives of Thailand. The Democrat Party's current leader is Abhisit Vejjajiva, incumbent opposition leader and former Prime Minister. The party upholds a conservative...
-run Bangkok Metropolitan Administration gave away a million baht to each city community that joined the ”Self-sufficiency Community Plan According to His Majesty the King’s Self-sufficiency Initiative.”
Foreigners were for the most part left confused. After a meeting with Ministry of Finance officials where the need for more sufficiency was explained, Standard & Poor's
Standard & Poor's
Standard & Poor's is a United States-based financial services company. It is a division of The McGraw-Hill Companies that publishes financial research and analysis on stocks and bonds. It is well known for its stock-market indices, the US-based S&P 500, the Australian S&P/ASX 200, the Canadian...
director of sovereign ratings noted, "No one knows what [sufficiency economy] really means." The Asia Times noted that, "There is a concurrent risk that the royal philosophy will be twisted by less scrupulous government officials as an opportunity to abuse their authority for rent-seeking and extortion, particularly among foreign-invested concerns".
Philosophy
The Sufficiency Economy is not a theoryTheory
The English word theory was derived from a technical term in Ancient Greek philosophy. The word theoria, , meant "a looking at, viewing, beholding", and referring to contemplation or speculation, as opposed to action...
about how the economy of a country works, but rather a guide
Guide
A guide is a person who leads anyone through unknown or unmapped country. This includes a guide of the real world , as well as a person who leads someone to more abstract places .-Guide - meanings related to travel and recreational pursuits:There are many variants of...
to making decisions that will produce outcomes that are beneficial to development. Also, The NESDB
NESDB
NESDB is the National Economic and Social Development Board of Thailand. It is also called as "Sa-pa-pat" in Thai.-Background:* Established in 1950 as the National Economic Board * Renamed National Economic Development Board in 1959...
has the definition of the philosophy
Philosophy
Philosophy is the study of general and fundamental problems, such as those connected with existence, knowledge, values, reason, mind, and language. Philosophy is distinguished from other ways of addressing such problems by its critical, generally systematic approach and its reliance on rational...
that - Sufficiency Economy is a philosophy
Philosophy
Philosophy is the study of general and fundamental problems, such as those connected with existence, knowledge, values, reason, mind, and language. Philosophy is distinguished from other ways of addressing such problems by its critical, generally systematic approach and its reliance on rational...
that stresses the middle path as an overriding principle for appropriate conduct by the populace at all levels. This applies to conduct starting from the level of the families, communities, as well as the level of nation in development
Economic development
Economic development generally refers to the sustained, concerted actions of policymakers and communities that promote the standard of living and economic health of a specific area...
and administration
Administration (government)
The term administration, as used in the context of government, differs according to jurisdiction.-United States:In United States usage, the term refers to the executive branch under a specific president , for example: the "Barack Obama administration." It can also mean an executive branch agency...
so as to modernize in line with the forces of globalization
Globalization
Globalization refers to the increasingly global relationships of culture, people and economic activity. Most often, it refers to economics: the global distribution of the production of goods and services, through reduction of barriers to international trade such as tariffs, export fees, and import...
. “Sufficiency” means moderation
Moderation
Moderation is the process of eliminating or lessening extremes. It is used to ensure normality throughout the medium on which it is being conducted...
, reasonableness, and the need of self-immunity for sufficient protection from impact arising from internal and external changes. To achieve this, an application of knowledge with due consideration
Consideration
Consideration is the central concept in the common law of contracts and is required, in most cases, for a contract to be enforceable. Consideration is the price one pays for another's promise. It can take a number of forms: money, property, a promise, the doing of an act, or even refraining from...
and prudence
Prudence
Prudence is the ability to govern and discipline oneself by the use of reason. It is classically considered to be a virtue, and in particular one of the four Cardinal virtues .The word comes from Old French prudence , from Latin...
is essential. In particular great care is needed in the utilization
Utilization
Utilization is a statistical concept as well as a primary business measure for the rental industry.-Queueing theory:In queueing theory, utilization is the proportion of the system's resources which is used by the traffic which arrives at it. It should be strictly less than one for the system to...
of theories and methodologies for planning and implementation in every step. At the same time, it is essential to strengthen the moral
Moral
A moral is a message conveyed or a lesson to be learned from a story or event. The moral may be left to the hearer, reader or viewer to determine for themselves, or may be explicitly encapsulated in a maxim...
fibre of the nation, so that everyone, particularly public officials, academics, businessmen at all bevels, adheres first and foremost to the principles of honesty
Honesty
Honesty refers to a facet of moral character and denotes positive, virtuous attributes such as integrity, truthfulness, and straightforwardness along with the absence of lying, cheating, or theft....
and integrity
Integrity
Integrity is a concept of consistency of actions, values, methods, measures, principles, expectations, and outcomes. In ethics, integrity is regarded as the honesty and truthfulness or accuracy of one's actions...
. In addition, a way of life based on patience, perseverance, diligence, wisdom and prudence is indispensable to create balance and be able to cope appropriately with critical challenges arising from extensive and rapid socioeconomic, environmental
Environmental policy
Environmental policy is any [course of] action deliberately taken [or not taken] to manage human activities with a view to prevent, reduce, or mitigate harmful effects on nature and natural resources, and ensuring that man-made changes to the environment do not have harmful effects on...
, and cultural changes in the world.
Criticism of the philosophy
There have been the efforts by military junta government to incorporate the King's 'Sufficiency Economy' (Localism) in the national economic policy. Thai critics are generally careful to direct their comments towards the military junta government, rather than the King, out of fear of prosecuation for lèse majestéLèse majesté
Lese-majesty is the crime of violating majesty, an offence against the dignity of a reigning sovereign or against a state.This behavior was first classified as a criminal offence against the dignity of the Roman republic in Ancient Rome...
. Consequently, such criticism is often phrased as inneffective application rather than disagreement in principle. Nonetheless, common points of disagreement include:
- The philosophy is not consistent with Thailand economic development,
- Nobody understands it and there are several unclear interpretations and
- Other theories have historic academic grounds.
Investment.
Sufficiency economy is designed to cover the weaknesses in the capitalism, i.e. the philosophy alone cannot be used solely, but can be a complement to capitalism.For example, the philosophy states that one must consider the investment at low risk, avoid the investment that possess the potential of over-finance. This idea is not new, but has already been in the financial textbook (close to the concepts in finance: Liquid ratio, acid ratio, debt-capitol ratio, etc.).
Loan.
Another example in the philosophy: one must save money enough before investment, and do not overinvest such that you become deep in debt. Some believe this idea is in conflict with the concepts of economy of scale and economy of scope in economics and exploitation of the future demand.Resource
Self-sufficiency economy (Localism) offers the idea of limited productions for the purpose of saving the environment and scarce resources. The production is limited to the level that adequate for individual consumption the excess of the consumption will be for sale. This gives rise to the problems according to the four conditions of the availability of resources: abundance; scarcity; and nonrenewable resources.Scarce resources and nonrenewable resources
The philosophy emphasizes these two conditions of the availability of resources. The philosophy implies that resources and production are for individual consumption, and the excess of the consumption would be for sales.Social class and resource consumption
The philosophy holds that the rich can consume as much resource as they like if their consumptions do not incur loan. In contrary, the poor should consume resources only at the level that do not incur any loan.Media Criticism
Asia Times Online has published an article that analyzes the Thai military junta government's economic policy that is fully influenced by the King's self-sufficient philosophy . The article notices the unexpected, rather bold step in Thailand economic development of the military junta government, endorsed by the King, that willingly responds to the King's philosophy. The article criticizes the philosophy as being so new as to have no academic ground and no empirical approval. As a consequence, any misstep, whether improper interpretation from the philosophy to be economic policy or the unaudited practices, would have caused the Thai economy's demise. The article also claimed that the protectionism that the Thai government has used will disperse foreign investors and reduce short term cash flow from outside the country.The article emphasizes the contradiction between capitalism and self-sufficient economy, which it favor the long-term economic alignment and environmental friendly, that are the main principles in the philosophy, particularly in lowly-regulated market. The Thai model of sustainability is slightly different to western sustainable development. In the western concept of sustainable development, the force that drives the will to save the environment comes from corporations' need. In the Thai model, the driving force comes from basic human psychological state of need. This psychological state of need comes from long government education of the public. The other name for localism in Thailand is called "Buddhist Economics" .
The philosophy has been made corporeal by Pridiyathorn Devakula
Pridiyathorn Devakula
Mom Rajawongse Pridiyathorn Devakula served as Minister of Finance in Thailand's interim civilian government. Before being named to the Cabinet of Prime Minister Surayud Chulanont, Pridiyathorn had served as Governor of the Bank of Thailand since 2001...
, Minister of Finance, who proclaims he is the supporter of the King's self-sufficiency economy or Localism. The examples of his policies that follow the King's localism are: Limiting foreign companies investments that enormously reduce liquidity in Thai economy; regulation and investigation of foreigners' source of fund; and Capital controls that destroyed US$20 billion of market value in one day. As a consequence of capital control and investigation over foreign investors, World Trade Organization (WTO) sent negative feedback to Thailand and doubts the ability of Thailand to continue to be the WTO member . The prime minister Surayud Chulanont
Surayud Chulanont
General Surayud Chulanont is a Thai political figure. He was the Prime Minister of Thailand and head of Thailand's Interim Government between 2006 and 2008...
, who also proclaims the King's localism, has called for the former minister of commerce Somkid Jatusripitak
Somkid Jatusripitak
Somkid Jatusripitak , Chinese: 曾汉光, Thai politician, is a former Deputy Prime Minister and Minister of Commerce of Thailand. He was a leader and cofounder of the populist Thai Rak Thai party. His wife, Anurachanee Jatusripitak, teaches at Chulalongkorn University...
, who are pro-capitalism, to the service of the country.
Articles appearing in the Bangkok Post on 22 February 2007 noted that Somkid Jatusripitak, who had been the finance minister in the previous Thaksin-led government, resigned his new position as spokesman for the sufficiency economy within days of being appointed. His appointment to the position had been heavily criticized, and Mr. Somkid said that he resigned in order to prevent ongoing divisions in Thai society.
The Bangkok Post reported on 23 February 2007 that there is now discussion about whether the committee drafting the new constitution should include language defining Thailand's economic policy. The previous constitution, drafted in 1997, had identified capitalism and free markets as the Thai economic philosophy.
The government has made the King's self-sufficient philosophy corporeal by promote the use of local currency, for example. The use of "Bea-Kud-Shum", as a local currency in specific part in rural Thailand, has been endorsed by the Thai government in August 2006. However, the use of currency instead of 'Baht' had been deemed illegal before. By using local currency such as "Bea-Kud-Shum", the currency itself is exempted from tax collection and can interfere with tax system.
Note
The Asian Timess article "the King's 'Sufficiency Economy' (Localism)" may be misunderstood. "Sufficiency Economy" calls for partial localism - a quarter - not the whole . In other words, "sufficiency economy" is meant to be "partial" localism. It is true that many parts of Thailand still enjoy capitalism. "Sufficiency Economy" calls on those to practice "some" localism particularly those in the rural areas. However, the oppositions see no difference between "Sufficiency Economy" and "Self-sufficient economy", i.e., they are the same as Localism . Kevin Hewison describes the self-sufficient political agenda in Thailand as Populist Localism.Self-sufficiency as a Political agenda in Thailand
Self-sufficiency is being strengthened through the link between nationalism and the King. Criticism over the King's philosophy would be a demonstration that the critics do not respect the King. The philosophy itself is often portrayed as a national barrier that guards Thailand from evil foreign, greedy, scheming capitalists.After the ousting of former Prime Minister Thaksin, the Thai government under the Prime Minister Surayut began a political campaign that under King Bhumibol's Localism is the new Utopia
Utopia
Utopia is an ideal community or society possessing a perfect socio-politico-legal system. The word was imported from Greek by Sir Thomas More for his 1516 book Utopia, describing a fictional island in the Atlantic Ocean. The term has been used to describe both intentional communities that attempt...
. Thus, Localism is used as a political tool to counter Thaksin's proposal of Thaksinomics. The King's philosophy had been introduced to Thailand before Thaksin was prime minister. In fact, for the celebration of King Bhumibol Diamond Jubilee
Diamond Jubilee
A Diamond Jubilee is a celebration held to mark a 60th anniversary in the case of a person or a 75th anniversary in the case of an event.- Thailand :...
, Thaksin's government organized public exhibitions commemorating the event, one of the major exhibitions being sufficiency economy.
See also
- Sustainable developmentSustainable developmentSustainable development is a pattern of resource use, that aims to meet human needs while preserving the environment so that these needs can be met not only in the present, but also for generations to come...
- Self-sufficiencySelf-sufficiencySelf-sufficiency refers to the state of not requiring any outside aid, support, or interaction, for survival; it is therefore a type of personal or collective autonomy...
- Sustainable livingSustainable livingSustainable living is a lifestyle that attempts to reduce an individual's or society's use of the Earth's natural resources and his/her own resources. Practitioners of sustainable living often attempt to reduce their carbon footprint by altering methods of transportation, energy consumption and diet...
- XiaokangXiaokangXiaokang is a Confucian term describing a society of modest means, or a society composed of a functional middle-class.- Ancient Use :...
External links
- Sufficiency Economy, the Chaipattana Foundation Journal
- New Mandala interview with Professor Kevin Hewison where he discusses sufficiency economy