Monday, May 10, 2010

Income inequality in Thailand

In Thailand the income inequality gap is the widest in the world, almost double the size of the US and wider than any of it's neighbors.

Thailand has enacted many pro-poor policies and has met the Millennium Development Goal on poverty. However, the inequality has spilled over into organized protests in recent weeks.

From the IPS, writer Marwaan Macan-Markar explains just how wide the gap is.

"The richest Thais earn 14.7 times more than the poorest," said Gwi-Yeop Son, resident representative of the United Nations Development Programme (UNDP), during the launch of the ‘Thailand Human Development Report 2009’. "The bottom 60 percent of the population’s share of the income is only 25 percent."

This rich-poor divide is stark when measured against developed countries that have public policies aimed at reducing the economic inequality ratio between the average income of the top fifth of households and the bottom fifth, the 163-page report noted.

"In societies which value egalitarianism, such as Japan and Scandinavia, the multiple is around 3-4. In the rest of Europe and North America, it is 5-8. Among Thailand’s South-east Asian neighbours, the figure is around 9-11. In Thailand it is around 13-15," the report said.

The country’s income inequality is the result of many divisions. They include the urban-rural divide, one between Bangkok, the major concentration of wealth and power, and the rest of the country, and splits between sections of the economy that have latched on to globalisation and those that have remained detached, states the report.

The spread of the kingdom’s 42-million workforce – where a third is in the formal economy "of salaried jobs and sizeable enterprises" and two-thirds make a living in the informal economy of "family farms, casual labour and petty business" – also mirrors the glaring inequality gap, added the UNDP publication.

"There is growing awareness that inequality lies at the root of several forms of human insecurity, including rising political conflict," it said. "The richest and poorest areas of the country are clearly on opposite sides of a deepening political divide."

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