Thailand - Politics, government, and taxation



On 24 June 1932, Thailand's political system changed from an absolute monarchy to a constitutional monarchy. The king is the head of state and is very much revered by the Thais. Presently, the monarch is King Bhumibol Adulyadej, who ascended the throne in 1946. King Bhumibol Adulyadej has been specially recognized for bringing the Thai monarchy closer to the people. In 1955, he visited the poorest regions of Thailand in order to see for himself the living conditions of the people. Since then, the king and his family have spent 7 months of every year visiting each of the 76 provinces of Thailand. As a result, the king is very well informed of the distinct needs of each region.

To date, the king has implemented over a thousand projects to improve the living conditions in the remotest rural areas, including the introduction of new crops, water conservation, irrigation, swamp drainage, preservation of national forests, and crop substitution. One of the king's most publicized projects is the Royal Rain-making Project, wherein after years of careful experimentation, 14 different formulae were invented to address the problem of dry spells in Thailand.

The Thai Constitution mandates that the government should be placed under the administrative power of a prime minister, a cabinet, and a bicameral legislature composed of a 253-member appointed Senate and a 500-member, popularly-elected House of Representatives. The prime minister is selected from the majority party in the ruling coalition in the House of Representatives. Since 1932, Thailand has promulgated 16 constitutions, the latest of which was adopted in 1997.

The cabinet is composed of 13 ministries together with the Office of the Prime Minister and the Office of State Universities. Each ministry is led by a minister who is assisted by one or more deputy ministers. In addition, there are ministers holding the portfolio of "Minister Attached to the Prime Minister's Office." These ministers take charge of the sectors assigned to them and assist the government in the formulation and implementation of national programs. The National Economic and Social Development Board (NESDB) is the agency in charge of longer term development planning, which is implemented in 5-year periods. Aside from the NESDB, other important government agencies for economic planning are the Board of Investment (BOI), which provides incentives for investment, the Office of the Technical and Economic Cooperation Department, and the Office of the National Education Commission.

The Ministry of Industry is crucial in assisting the government in all industry and manufacturing-related activities such as formulating policies, licensing of factories, issuing mineral leases, formulating and supervising industrial standards, providing technical assistance to industries, and supervising the Small Industries Finance Office. Meanwhile, the Ministry of Commerce oversees external and internal trade. Specifically, it controls or supervises prices of certain strategic commodities such as rice and provides export promotion services to export companies.

The Thai government believes that the private sector should lead the country in its quest for progress and development. In this endeavor, the government's major contribution to economic growth was to provide economic and social services; provide financial resources for the construction of physical infrastructure like highways, irrigation, and power facilities; and to formulate and offer various incentives and financial assistance to promote private investments, export businesses, and agricultural enterprises.

Since the 1950s, the government followed a clear direction towards private enterprise. International organizations like the World Bank and the United States Agency for International Development as well as the United States have strongly encouraged Thailand towards adopting that strategy.

Presently, the Thai government is at the forefront, alongside the business sector, in implementing a wide range of economic reforms to promote Thailand's economic recovery from the 1997 recession . Improvements have also been made in the implementation of economic and social welfare programs. This effort is guided by the new constitution, which promotes a stronger, more accountable, decentralized, and transparent government.

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