Feeling the pinch in quest for cashless society
With the launch of the digital economy, plans to achieve Thailand 4.0, the Startup Thailand initiative, the Eastern Economic Corridor and high-speed trains, Prime Minister Prayut Chan-o-cha is determined to turn Thailand into a cashless society.
In his latest weekly televised programme, Gen Prayut said his government is pursuing a goal to achieve a cashless society, which would benefit the people and the country. The ambitious effort will also play a substantial role in taking the country to Thailand 4.0.
In a cashless society, people will no longer have to carry cash or worry about losing their cash. If members of the public and the private sector rely more on the e-payment system or make payments through smartphones more, stores and shops will follow suit. The e-payment system helps make purchases more convenient and it reduces the use of cash.
In principle, this should ensure faster and safer financial transactions, especially when people purchase high-priced items. They will not have to worry about carrying large sums of money that can be stolen, Gen Prayut said.
At the macro level, it would help the country save at least 20 billion baht a year spent on cash management, including minting, counting and phasing out old banknotes.
With the various sophisticated economic projects introduced by the regime, it’s not too difficult to believe that Thailand has seen substantial economic improvement and advancement. But there are several divergent facts that make me question the achievement.
The latest is a story of villagers in tambon Nong Muong, in Khok Sung district of Sa Kaeo, where the prime minister visited last week. They complained to the media that officials had removed power poles and stopped supplying tap water after Gen Prayut returned to Bangkok.
The day Gen Prayut visited the village to present agriculture land documents to residents, there were power poles and electricity cables along the road. The prime minister also turned on a water pipe valve to mark the occasion, releasing clean water to designated farm land.
This made villagers happy and they became hopeful of a better life.
Unfortunately, that hope and
happiness were short lived. All the facilities were removed just a day after the prime minister left.
Authorities explained the area was not part of the zones that fell within the electricity and water supply plans. The facilities were erected and operated at the scene only for the prime minister’s visit and were meant for temporary use only.
When the story made headlines, there were reports that Gen Prayut felt uncomfortable about the news. Authorities then rushed to develop permanent power and water supplies in the area.
This piece of news reflects two basic problems in this country. First, the culture of state officials window dressing instead of doing actual work. Second, an imbalance of infrastructure and economic development.
As the prime minister announces in the capital that the country is set to become a cashless society driven by
advances in fintech, there is no power and water supply in many corners of the country. Isn’t that weird?
It’s fine if the government has a vision to catch up with fast-changing global technology and trends, but it should not ignore the fundamental problems the country faces, particularly with inequality, the quality of education, the healthcare scheme, inefficient irrigation systems, the quality of human resources, low standards of morality and corruption.
In fact, tackling these basic problems should be a priority. Without strong foundations, advancement will difficult to achieve.
As far as the economic situation in concerned, there are also divergent trends to be seen. Although the government and state agencies are optimistic about economic prospects and insist the economy has recovered, the situation in the real sectors is questionable. Exports
in July climbed at a double-digit clip of 10.5% to $18.9 billion, causing the Commerce Ministry raising its 2017 export growth target to 7% from a previous forecast of 5%.
The government is also considering revising the economic growth target this year from 3.6% to 4% driven by rising exports and inbound tourism.
But at the same time, there are reports that the Revenue Department’s tax collection fell short of the mark by 60.3 billion baht or 4.1% to 1.4 trillion. Valueadded tax was 41.2 billion baht or 6.3% lower than the target and the petroleum tax missed its goal by 24.8 billion baht.
Meanwhile, the sales of fast-moving consumer goods was reported to have grown just 1% in the first half, the lowest rate in the past decade.
Nominal farm income contracted 2.6% in July, representing the first contraction of the year. And the unemployment rate rose to 1.22% or 465,000 jobless people in the second quarter, from 1.08% in the earlier quarter. About 40% of the unemployed had university degrees.
What should ordinary people bank on? The government’s figures or their “cashless” pockets?
Phacharaphot Nuntramas, head of economic and financial market research at Siam Commercial Bank, explains the Thai economy has clearly split in two.
The sectors involving foreign countries such as exports and tourism have grown while domestic sectors remain stuck in the slow lane as a majority of people still lack confidence in their financial security and try to ration their spending as they do not feel the economy is improving.
This is a challenge for Gen Prayut and his regime.