Economy

Endowed with considerable natural resources-including tin, rubber, natural gas, timber, fisheries products, and tungsten-Thailand has demonstrated impressive growth in its domestic economy. In 1981, the GNP was $36 billion, with an annual growth rate of 6.8 percent. Per capita income was estimated at $758. The inflation rate was 12 percent. Thailand is in the middle range of developing nations. Foreign trade and investment are an important part of the economy. Thus, in recent years, high international interest rates and declining prices for many exports have slowed Thai economic growth.

Agriculture constitutes 26 percent of the GNP. Land is 24 percent agricultural, and important crops are rice, corn, sugarcane, manioc, and rubber. Harvests are consistently larger than domestic consumption, and Thailand exports large quantities of food each year.

Industries and the services sector are also important and have contributed to the consistently rapid growth of the Thai economy. Industries constitute 27 percent of the GNP. Major industries include textiles, wood products, tin and tungsten mining, and agricultural processing. Tin and textiles are the major exports.

Tourism is an important growth industry. Thailand attracts travelers from all over the world, who come to visit the temples, to purchase gems and handicrafts, and to enjoy the beaches and resorts.

Foreign investment is important in Thailand. Multilateral financial institutions, such as the World Bank, the Asian Development Bank, and foreign governments provide official credits. Large-scale, energy-related projects, including the development of gas resources in the Gulf of Thailand, the exploitation of lignite (brown coal) deposits in the northeast, and transportation and electricity supply throughout the country, have been financed from abroad. Private investment is encouraged, and most important sectors of the economy are privately owned and operated. The Thai government recognizes that the continued supply of new capital will be necessary to achieve further growth.

Social and economic trends include increasing urbanization, expansion of industrial activity at a faster rate than agriculture, and growth of incomes in service industries. These trends are often associated with growth and modernization, but they have also produced problems that the Thai government recognizes and seeks to relieve. Bangkok faces housing problems and severe pressure on basic services, including water, energy, and transport facilities. In addition, because the area of land under cultivation is unlikely to increase, income growth can only result from greater productivity per hectare, as well as from more efficient industrial production. A national planning agency has been established to meet the problems that development poses. Budgetary resources for implementing the national plan have been increased in each of the recent annual budgets.