The outbreak of COVID-19 reaffirms the old saying that “good health is incomparable wealth.”
But the economic consequences of the measures to curb its spread have taken a heavy toll on the wealth of many and the wage of millions. In the name of physical distancing, congested areas like shopping malls and entertainment venues were temporarily closed, while airlines cancelled services. When economic activities and society cannot function as usual, the obvious result is bankruptcy, unemployment and a miserable livelihood, particularly for those already less advantaged.
Amidst such a crisis, competing views taunt us--how can we achieve balance between public health and economic prosperity? When people are concerned with the effects of the restrictions on their daily lives and survival, the state needs to step in to ensure that the economy, public health and social welfare progress in the same direction.
In the case of Thailand, the government has performed well so far in containing the infections of the virus and mitigating its impact. At the same time, it is addressing public concern on economic risks by injecting loans and financial assistance to the people. Some observers rightly noted that if the economy is an ailing patient in dire need of oxygen, the cash flow pumped in by the government is comparable to the breath of fresh air in a stale room.
To date, Thailand has already approved economic relief measures in three phases that caters to entrepreneurs, blue collars and households so that sources of revenue whether in the form of income, aid or loan is accessible by every vulnerable sector in the society.
The first phase of the economic relief measures was approved by the cabinet on 10 March 2020 and focuses on securing the country’s financial foundation, addressing monetary, fiscal and capital market measures. These include low interest loans of up to 150 billion baht and debt moratorium for entrepreneurs by the Government Savings Bank and Government Housing Bank, relaxing rules for granting commercial bank loans, and a credit line with low interest for three years from the Social Security Fund. Fiscal measures seek to assist SMEs through many means, including tax deduction and redemption for entrepreneurs, while other measures seek to reduce costs of businesses by refunding electricity usage deposits and reducing rental fees for state properties.
Phase 2 provides assistance to employers and employees financially affected by COVID-19. Almost ten million workers not covered by the Social Security Fund (SSF) will receive income compensation of 5,000 baht per month for six months while those under the SSF will be entitled to an increased unemployment compensation of up to 62 percent of their daily wages for no more than 90 days. The government is also planning long-term investment in its human resources, by offering training and skills enhancement courses for workers affected by the COVID-19 outbreak such as language training for local tour guides and business management training for business operators.
Businesses will also be entitled to loans, extension of corporate income tax and the exemption of import duty for products related to the prevention and treatment of COVID-19 until 30 September 2020.
On 7 April 2020, the cabinet approved further measures worth 1.9 trillion baht or 12 percent of the GDP to reinvigorate domestic economy and stabilise the financial system. Out of this amount, 1 trillion baht (approximately USD 31 billion) is allocated to healthcare and economic measures. This includes 600 billion baht for health-related plans and economic relief to farmers in the agricultural sector and business operators and 400 billion baht for development of local economies and infrastructure that would help improve productivity and strengthen the domestic economy in the long term.
While COVID-19 temporarily stunted the economy, Thailand did not wait for the virus to weaken. In the absence of tourists, Thailand took this advantage to improve the quality of tourism services by developing advanced technology and expanding e-commerce applications. Thailand’s nature and preservation parks entered a “spa phase” restoring themselves into an even more pristine condition in the absence of humans. Don Mueang International Airport in Bangkok was also renovated. Thailand developed research and technology for domestic solutions, such as the innovation of medical assistant robots to help doctors and nurses take care of patients. Thailand has also worked with farmers and entrepreneurs to improve their online literacy and skills on digital platforms, as well as enabling the use of e-commerce and access to a wider market.
All these measures serve to bolster and strengthen Thailand’s economy in a situation similar to the Asian economic crisis in 1997. Back then, the Sufficiency Economy Philosophy was introduced by His Majesty King Bhumibol Adulyadej The Great to encourage a more balanced approach to development, taking consideration of both economic growth and the local environment based on reasonableness and moderateness.
It is time to re-explore this philosophy as an alternative approach to development that could help form immunity against any external shocks. Yet self-sufficiency does not mean that we should always be humble in our economic objectives if we have the capacity to achieve them. For instance, Thailand is pursuing a 4.0 economic model to escape the middle-income trap and to drive forward a high technology and innovation-driven economy.
All these attest to Thailand’s conscientiousness in the present moment and its forward-looking vision to strengthen Thailand’s status as a coveted logistics and services, tourism, and investment hub. It will be a long road to recovery after COVID-19 before we resume normalcy and our economy regains momentum. But as long as we remain committed to our aspirations, the world will rebound and emerge with a stronger sense of resilience and solidarity.