SO MUCH FOR POTENTIAL
Thailand is possibly the best positioned to be a Tier 1 emerging market. It has a strong capitalist bent, a functioning and established stock market, decent infrastructure, a world-class metropolis in Bangkok, a booming tourism business, a strong port system, and a friendly and welcoming population with a history of modern independence from foreign rule. I could have written the same thing 20 years ago.
Therein lies the problem and why Thailand may never gain Tier 1 status. For as long as I can remember, Thailand has been the one to watch in Asia. It has seriously underdelivered. I commented to an audience once that “some emerging markets will always be emerging,” and I truly believe that Thailand is one of those.
There’s a joke I use on occasion when talking about Thailand. It goes something like this: “What do the Thais call a coup? An election.” Since 1932, Thailand has witnessed 10 coups and 7 aborted attempts. Most recently, in 2006, the government of corrupt billionaire Thaksin Shinawatra was overthrown and he was forcibly exiled. Shinawatra came to power on a Peronist, populist platform and proceeded to enrich himself and his cronies. But the story does not end there. Fast forward to 2011 and Shinawatra’s sister Yingluck Shinawatra was elected prime minister, again running on a populist platform. Thailand, like many Tier 2 emerging countries has a history of faux political instability. I say faux because the instability in the system ...