Question

What are Thailand’s most important exports? What is the “current” (1997) situation in Thailand? What are the highlights of the IMF’s bailout of Thailand?

please be descriptive and provide bullet points

Answer 1

Answer- Introduction:

Thailand is one of the severe victims of Asian crisis in 1997, which devastated the whole economy from financial losses to fall in welfare. However with effective Monetory and fiscal policies along with the financial help provided by the IMF it grew ,but initially had huge debt burden on its shoulder

Important exports of Thailand :

From 2019, analysis

1. MACHINERY WITH COMPUTER- $40.2 billion
2. ELECTRICAL MACHINE AND EQUIPMENT- $33.9 billion
3. VEHICLES- $28.9 billion
4. GEMS,PRECIOUS METALS- $15.7 billion
5. RUNNER AND ITS ARTICLES-$15.3 billion
6. PLASTIC AND ITS ARTICLES-$13.3 billion
7. MINERAL FUELS- $8.5 billion
8. MEAT/SEAFOOD PREPARATION-$6.7 billion
9. OPTICAL,TECHNICAL MEDICAL APPRATUS- $5.4 billion
10. ORGANIC CHEMICALS-$4.6 billion

All are in US dollar,the top most was providing 16.4% of total exports, followed by 13.8%,11.8%,6.4%,6.3%,5.4% ,then 3.5%,2.7%,2.2%,1.9% respectively as the table above.. However organic chemicals exports had declined by -24.9% as from prior

1997, condition of Thailand:

• There was Asian crisis ; where in Thailand the financial market collapsed. On 2 July the THAI BHAT was allowed to float
• Soon Thailand had huge foriegn debt of US$39 billion :half from Japanese banks
• By November 1997, growth of real GDP -0.6% ; inflation in consumer price index at 10%; external debt at US$94.9 billion or 58.6% of GDP
• Stock market fell to half of its value.
• Even the bhat, after opening from July significantly fell till mid of December , depreciating almost to 77% of fixed rate prior opening for floation
• It was expected to worsen in next coming years
• A new constitution was passed in parliament -As per it the government and politics were suppose to be more concerned with national interest than there own
• However Chuan Leekpai government did great to restructure the financial market
• And with depreciation exports increased

IMF bailout of Thailand :

1. On 20 August,1997 IMF Executive Board approved to give financial assistance to Thailand of $4billion for 34 months
2. With total bilateral and multilateral assistant ,it was total at $17.2 billion
3. In September,1999, Thailand without informing drew out $14.1 billion for improvment in Economical position of nation.
4. Monetory policy now focused to have stability in exchange rate and to accelerate economic growth
5. Fiscal policy shifted to Handel the dropping economy
6. In financial sector ,many financial sector were liquified and state helped the weak banks
7. By late 1998, economy with financial aid and policies got positive GDP ,which reached to 4% in 1999
8. With positive productivity, Thailand made IMF as precautionary and did not take out money after September 1999

Conclusion :

• Real GDP in 1997 was -1.7 and rose to -10.2 next year however by 2000 it was 5
• Consumer price from 5.6 in 1997 reduced to 3 by 2000
• Current account balance was -7.9 in 1997 grew to 9.1 by 2000
• Biggest of all achievment was external debt from US$93.4 billion dropped to US$67.8

Overall the Thailand economy grew from ashes and achieved its healthy and stablized economy back

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