Sufficiency economy pondered upon

"Sufficiency economy" can be better understood if it is seen as something quite uniquely Thai, with all its cultural nuances and non-translatable terms. It could be better understood if one is able to speak Thai and has followed its debate, discourse, promotion and implementation in the Thai language. When one tries to explain it in English, there are frustrating confusions, such as, is it an economic thought? Or is it a Buddhist philosophy? Is it the same as sustainable development or environmental sustainability? Most importantly, is it worth discussing or can it be applied anywhere else but in Thailand?

The person explaining from the Thai point of view can't explain it sufficiently, first, because of that frustrating incompatibility of the English language for explaining many Thai concepts. On top of that he/she is also challenged to apply western economic concepts to something that is more an expression of Buddhist philosophical thought than an economic thought. One speaks about the mind and its effects on the quality of life while the other speaks about quantitative monetary concepts. One calls for a middle way that considers family and community relationships and environmental responsibility, while the other is just looking for cost efficiency or the best price that expresses the right balance between supply and demand. How do you quantify the diverse levels of how each unique individual defines what is "sufficient" for him or his community? Price, demand, supply, efficiency, etc. becomes hopelessly inadequate as measurements. How does one quantify generosity or charity or a 'right' mind? Because sufficiency economy fails to answer these questions, its critics declare that it is not an economic thought nor a viable economic model.

The story of sufficiency economy developed in Thailand nearly along the same timeline as the story of how sustainability caught on as desired developmental goal recognized by the UN in 1972 at the UN Conference on the Human Environment held in Stockholm, popularized 15 years later with the Brundtland report (1987) and adopted as a major wold challenge at the Rio Earth Summit (1992). In Thailand, sufficiency economy was being shaped and implemented as an economic thought since the late fifties/early sixties when a young king travelled laboriously around his country initiating development projects where he could to better the lives of people in remote areas.

Despite its current popularity, sufficiency economy is not a mainstream economic model in Thailand. It is more like a supplementary prescription for the shaping of economic activities to counteract the ills of a dominantly capitalistic model. Sufficiency economy as an alternative economic thinking is one that is gaining ground one poor village by one poor village converted, as individuals who were inspired by its principals implemented and demonstrated successful local action again and again. In many cases, villages that could not feed themselves started growing their own food as an alternative to growing cash crops that had only caused them to become increasingly indebted. Instead of buying expensive fertilizers, they have expanded the supply of organic food, some even becoming successful with an export niche market.  At the same time, depleted forests are being regenerated and a future in which environmental and community awareness where values such as love, friendship, and generosity gain triumph over profit and greed are being re-enforced.

A recent article, "Sufficiency Economy" was published by PETER JANSSEN on The Manila Bulletin (http://www.mb.com/, December 27, 2010:  http://www.mb.com.ph/articles/295104/sufficiency-economy ), focused on a Thai abbot at Doi Pha Som forest temple (วัดธาตุดอยผาส้ม) in Chiang Mai, Sorayut Chayapanyo (พระสรยุทธ ชยปัญโญ), who had rebuilt an old temple, regenerated the surrounding forest, and helped villages grow out of debt. Stanford educated, but rejecting that privileged knowledge, he explains sufficiency economy as not being 'anti-capitalist' nor 'anti-Western', but as something between market economy and socialism. Sufficiency economy was shown as being meaningful in impoverished rural areas where access to the market economy was difficult. Money or greed were no longer the main locomotive of local economic activities once people learnt how to search for ways to become dependant on what they had.

This was not a new story for me. I have heard many very interesting local stories of how poverty was transformed into resourcefulness over the years adopting those principals proposed by the Thai King, proposed in his annual speech of 1972. What this story gave to me, this time, was the realization that it was the availability and strength of a localized social network or social structures, very particular to Thailand or maybe a Buddhist society, that plays an important role in nurturing the emergence of leadership or inspired action by individuals in the successful implementation of a sufficiency economic model.

Before Thailand became a modern economy with its building blocks in the late fifties/early sixties, much of its rural economy, community life or social fabric was structured around the temple. The temple was not simply a religious institution, it was also the place where education was being given, funds being raised for community development, and where the binds of society were formed and strengthened. In many cases, it was the ground where many non-monetary activities were supplementing the economic livelihood of its communities, with its festivals and fairs, funerals, alms giving and donations.

This was a social network that encouraged individuals to make a difference, usually with very small means.  As the modern economy grew, the state and modern markets took over much of the role that the temple played. Festivals are now just commercial events hosted on government grounds. They don't do much for that very personal tie that binds. As a modern Thai, I don't remind myself the value of giving each single day as my mother does, just by consistently getting up every morning to cook rice for a group of passing monks.

When I read yet another story of how one person transforms a community, it dawned on me that poverty is not converted by economic intervention, but by changing the emphasis on our values. When we review what we want of the world by starting a review of  our minds, not from the point of view of what objects or things we need, but from a point of view of what qualities in life we really need to make us contented, we can come to realize that we really don't need all those consumerist products and services the markets try to push on us. We then realize that we don't need to focus on chasing money so much when we can focus on just trying to define what makes us contented.

Climate Change Negotiations: An example of Public Diplomacy

Shah, Anup. “Reactions to Climate Change Negotiations and Action.” Global Issues, Updated: 04 Oct. 2009. Accessed: 06 Dec. 2010.

UNITAR's training program:
http://www.unitar.org/ny/environmental_negotiations

Thai cooking in Spanish

Recently inspired to find more simple solutions to making a video, finally got into editing on iMovie, and cut a DVD earlier produced into 4 minute shorts to upload to YouTube....



There's also more (cooking vdos in Spanish) to come at my YouTube channel:
http://www.youtube.com/user/netnapitasakorn?feature=mhum

"Stop calling them 'developing countries'" from Gapminder

The term "Developing Countries" might have made sense once.

Today it's impossible to make a clear distinction between "developing" and "developed" countries.

In 1950, most of the so-called "developing countries" had more than 5 children per women and less than 50 years of life expectancy.

Today, in most of the world, women have less than 3 and life expectancy is over 65 years.

Any attempt to divide the countries of the world into two groups, such as "developing and developed countries" will be an over-simplification.

Click play on the graph in the link below to see how the world has changed since 1950.

www.bit.ly/9DwNBE

The middle income trap

The Nation on Sep. 12, published an article announcing ADB's approval of a $300mn loan to Thailand to develop its capital market. The 15 year period loan is to be used in support of the Thai government's Capital Market Development Master Plan for 2009-13 for the development of the equity market, bond market and money market in four areas: regulatory environment; market efficiency, liquidity and transparency; market infrastructure; and new products and investors. 

The government has made substantial headway in developing Thailand's capital market. Recent measures included establishing a timetable for the demutualisation of the Stock Exchange of Thailand, strengthening the surveillance and enforcement capabilities of the Securities and Exchange Commission, moves to develop the domestic bond market, and simplifying taxes on financial transactions. There has also been activities organised to improve public financial literacy.

What caught my interest was the mention of the capital market development plan's goal to help the country "transform from a middle-income to high-income economy through increased contribution of the domestic capital market to financing domestic investment and economic growth".

"The middle income trap" seems to be a recent development agenda that is being 'pushed around' at the moment. I remembered having recently read an article at Time about Malaysia's dilemma with this interesting concept. I had felt then that the writer didn't do much justice for Malaysia. However, it seems that this economic criticism is gaining some weight among policy makers. Here are a couple of related articles:

The Star, "Caught in middle income trap"

China Law Blog, "China, Malaysia, Korea And The "Middle Income Trap"

From an economist's blog, "Getting out of the middle income trap"

From a Vietnamese point of view, "Avoiding the middle-income trap: renovating industrial policy formulation in Vietnam"

From an Indian point of view, "The middle income trap" and "The challenge is to escape the middle income trap"

Of course, moving towards a higher income economy is a desired goal, but I can't help wondering. Is the simple focus on "income" levels obscuring other desired developmental goals? Like income distribution for one? Does higher income come with skewered income distribution? If it does, well, maybe it's okay to be "stuck" for a while, until those higher income countries can show us that people with lower income in their countries are receiving desired benefits of higher income, let's say... a good welfare service system for one, no?

Some recommendations of how to escape the middle income trap:

• a managed growth program with higher income, stronger currency, while maintaining a flexible foreign exchange regime and inflation control targets
• a more efficient capital market, availability of capital for sme and local firms to grow
• R&D spending
• tax reform (capital gain tax)
• investment in human resources
• developing an ability to produce and contribute to the global economy via home grown innovations

Economics aside, I think there are other socio-political issues that can cause a country to be stuck, my own list:

• political instability, stunted political development
• corruption
• a polarized society
• debt
• lack of investment in infrastructure and human capital
• energy self-sufficiency

To cap off, I found this interesting and useful guide, from You can read the Bangkok Post, by Jon Fernquest, "Avoiding the middle income trap: The challenges ahead for Thailand"