Globalization has a capacity to promote economics, politics and the exchange of knowledge between the different regions. Hence, the corporations arrange a lot of job opportunities in third world countries. A good illustration is Thailand, a country that has endured both the positive and negative consequences of globalization. As a result of globalization, the Thai government, exposed in its financial dependence, has originated a policy of economic diversification through industrial expansion. With this in mind, it is evident that globalization provided the country with Thailand’s evolving role in the global economy, which promoted the significant economic opportunities.
During our business visits, we were able to witness the strategies foreign companies employ when opening shop in Thailand. I saw the strategy Fred Mouaward employed to grow Taskworld into what it is today. It was amazing to see what that company accomplished with such a small investment in comparison to doing the same exact thing in Silicon Valley. I also witnessed the types of changes a company has to make in order to survive in a new country. McDonalds notably added things unheard up in the American market to their menu to appeal to the Thai demographic. They also created a company culture that made everyone involved feel like there wasn’t a hierarchy. McDonalds changed “Head Office” to “RSC” (Restaurant support center). They hosted family nights where the managers would cook burgers for their employees and their families.
Over the last four decades, Thailand has gained significant progress in terms of social and economic development. According to the data provided by the World Bank, "Thailand’s economy grew at an average annual rate of 7.5% in the boom years of 1960 to 1996 and 5% following the Asian financial crisis during 1999-2005. After average growth slowed to 3.5% over 2005-2015, with a dip to 2.3 % in 2014-2016, Thailand is now on the path to recovery" ("Overview", 2018). Consequently, an economic increase of Thailand reached more than 3.9% in 2017 and it is expected to rise to 4.1% in 2018 ("Overview", 2018). Generally speaking, the country moved from a low-income state of an upper-income nation. Accordingly, Thailand has been one of the most broadly cited development success cases since the state managed to maintain steady economic growth and reduced high rates of poverty.
Under the mentioned conditions, development and globalization in Thailand provoked the rapid processing of industrialization and urbanization so that the large-scale infrastructure projects became the most significant (Thornton & Thornton, 2016). The purpose of the development of infrastructure in Thailand is to guarantee that the rapid economic growth will provide the state with the prospectus position in the global market. In that case, the industrial superiority seems to be the highest aspiration of the Thai government (Sangpikul, 2017). Thus, in order to achieve this goal, Thailand had launched the entirely new agriculture systems, expanded access to services such as medicine and insurance, advanced transportation system, and promoted the economic wealth. It can be seen that globalization in Thailand is a mean required to increase investment and, thus, the economic growth of the state (Thornton & Thornton, 2016).
The economic development of Thailand is based on the character of government as it has a significant influence on the state (Beeson, 2014). The government of Thailand can be characterized as the unitary authority of the Kingdom of Thailand. Currently, the country seems to be attempting to reach constitutional order while the king is performing functions of mediation between the government and the other branches of authority. Meanwhile, the government of Thailand chooses the direction determined by the political atmosphere in the state (Sangpikul, 2017).
More than that, the government of Thailand has proclaimed its economic goals in 20-Year National Strategy so that it seems the authority of the country is making reforms to accelerate the economic development (Thornton & Thornton, 2016). The mentioned reforms direct such issues as financial stability, human resources, and environmental sustainability as well as try to overcome issues such as income gap and difficulties of bureaucracies. The recently implemented improvements include the implementation of insurance projects aimed at all citizens of Thailand. At the same time, the government of Thailand developed infrastructure system, adjusted taxes, and launched the program of the National Savings Fund (Beeson, 2014).
As growth in the Asian region is also expected to regain momentum, the economy of Thailand seems to progress due to the substantial features of the domestic market. For instance, there is a relatively stable level of employment; thus the economy should support growth. Accordingly, sustained capital inflows would encourage private investment and spread across the region (Sangpikul, 2017). Modernization spending and the easing of supply disruptions will be valuable, and it also will provide a temporary addition to economic growth in Thailand, while exceptional public investment would further increase domestic demand (Thornton & Thornton, 2016).
Nonetheless, the economic development of Thailand and its financial integration is exposed to the significant downside dangers surrounding the global economic situation (Thornton & Thornton, 2016). From a value-added perspective, the economy of Thailand is dependent upon the demands outside the Asian region, and the majority of those demands are from the United States of America and Europe (Beeson, 2014). Thus, it is evident that the development of the state is based on its integration with the other markets and globalization in general.
At the same time, a fall in this demand from the other regions would seriously impact economic activity in Asia. Aforementioned indicates that the area has become more exposed to the dangers that can be provoked by volatile capital flows. In this context, it is critical that the banks of European states have a meaningful presence in Thailand (Beeson, 2014). Nonetheless, there has been a weak influence of the deleveraging process of European nations in the Asian region as comparatively robust balance sheets have advanced the large regional banks in order to act as a barrier against a credit supply collapse. In fact, credit extension has continued at double-digit rates in Thailand (Sangpikul, 2017).
Accordingly, the most prospectors industries of Thailand to invest are food-and-beverage, hospitality, and health-services fields. One can assume that with an excellent reputation in the mentioned fields, Thai businesses should integrate the companies of the specified areas into the worldwide market (Beeson, 2014). Thai food, hospitality, and medical-services organizations might have more prospectors future with the introduction in the global market than in the national field.
On the negative side, the economic development of Thailand seems the be complicated by the cultural issues (Thornton & Thornton, 2016). To demonstrate, the followers of Buddhism in the state critiqued the current economic environment, as well as the influence of globalization on the country. Frankly speaking, Buddhism opposes all the issues linked to capitalization, which is directly connected to the economic development. What is more, even though per capita income has grown, the income gap in Thailand increased. Therefore, the state is facing a vast inequality in terms of the wealth distribution (Beeson, 2014). In the case, it appears that the goals uttered by Buddhist notions are contraindicated with economic aspirations and reforms of Thailand.
Considering the points mentioned above, one can state that the maintained pace and character of reforms, as well as a flawless implementation of the modifications, will be essential for gaining the desired economic outcomes. Currently, Thailand has a prospectus industries such as food, hospitality, and medical services, which can be promoted through the processes of globalization. Modifying the relative decay of competitiveness, increasing the effectiveness of achievements in the public sector, and improving the education system Thailand can get the prospectors role in the global economy. Thus, the government of Thailand will be able to take the country out from developing in high-income state.