BANGKOK, Thailand — Over the past few decades, Thailand has drastically reduced its levels of poverty and has experienced astonishing economic development. Seen as a development success story, export-oriented growth has classed Thailand as a middle-income country since 2011. However, poverty in Thailand’s countryside remains a problem.
Despite the unprecedented economic expansion, millions of rural Thais still live impoverished, unimpacted by Thailand’s fiscal boom. These facts help explain the phenomenon of rural poverty in Thailand:
In 1986, 67 percent of Thais lived in poverty. By 2014, the national poverty rate had dropped to 11 percent.
This telling fact speaks to Thailand’s impressive growth and poverty-reduction measures in the past 30 years. Education and healthcare expansion to the majority of the population greatly contributed to national poverty reduction. This fact alone makes Thailand one of Southeast Asia’s greatest success stories.
1. In 1988, Thailand’s GINI index was 43.8. Despite drastic poverty reduction, the GINI index had only fallen to 39.3 by 2012.
The GINI index is a tool used to measure income inequality: It measures the extent to which income distribution within a country deviates from a perfectly equal distribution. A GINI index of 0 represents perfect equality, whereas a GINI index of 100 implies perfect inequality where one person would possess all earnings. For example, Honduras has a GINI index of 53.7 and China has a GINI index of 29.1.
In Thailand’s case, such drastic poverty reduction should be accompanied by less income inequality nationwide. Although the GINI index did decline slightly, it is still high by international standards and did not decline in proportion to overall poverty rates. A reduction in poverty without a reduction in income inequality implies that only select portions of the population are prospering economically.
2. Those who are disadvantaged and live in rural areas make up 7.3 million people or 80 percent of the country. A total of 44.5 percent lives in the northeastern region, 24 percent in the northern region and the rest in the very south of the country.
According to the UNDP, vulnerable groups such as informal workers, migrants and displaced persons are at the greatest risk economically. Half of all impoverished Thais work in the agricultural sector and the rest are part of the “informal workforce,” consisting of part-time workers, those who are self-employed, informal small- and medium-sized enterprises, and landless laborers.
3. Poverty in Thailand is a rural phenomenon that occurs most drastically in the northeast — the most populous region in the country where the disadvantaged suffer the most.
However, recent commercial development has the potential to spread economic prosperity to the region. Condominiums, townhouses and shopping plazas are drawing foreign investors into the highly populated region. In 2012, total investment projects in the northeast reached $2.3 billion.
Rural poverty in Thailand exists because of unequal income distribution. But, the recent foreign investment and commercial development provide an opportunity for rural poverty rates to fall as drastically as national poverty rates.
– Anna O’Toole