Connecting the Dots

Over the past 4 years or so the Thai governments in power have made it progressively more difficult for non Thais to live in Thailand. Although they embrace tourists, they have hurt the parts of the general economy that are not tourist related. Viewing the state of the Thai economy that has been in general decline over the same period of time, the big question is will the Thai government undo some of the self inflicted wounds and make it easier for non Thais to call Thailand home.

This is a complex topic as the reason for the economic problems of Thailand are not all from one source, in fact there are several contributing factors. Most come from political unrest cause by Thaksin Shinawatra eating into the tourist money, some comes from the exodus of ex-pats finding it too difficult to obtain a proper visa, and some comes from just poor Thai management.

At the onset of this push to expel non Thais, the Thai economy was robust enough to absorb the smaller income. Nobody except the 100,000 or so Thais who started their own businesses to support the ex-pats or worked for companies that cater to the ex-pats felt the loss. Seeing that ex-pats tend to spend many more times the amount of money Thais do, there was an easy 1 to 2 billion Baht that was removed from the general economy.

The announcement of the changes in visa policy were made just before the 2006 coup, and many feel it was a reactionary decision based on some bad press about the behavior of some non-Thais living in Thailand. People who stayed and lived in Thailand on tourist visas were limited to staying 90 days out of every 180 days. So simply the endless visa runs were over. That policy started October 1, 2006 and the first 90 day period ending December 31, 2006. On that day being New Years Eve, there were also several bombs that exploded around Bangkok that were politically motivated. The combination of that and the negative fallout from the Coup put some serious wounds in the Thai economy.

As time progressed the Thais seemed to evolve the anti ex-pat attitude and started making it difficult for people with proper visas to get them renewed. Leaving the country every year to get a new 1 year visa was bad enough, but now it has evolved to the need to leave Asia to get one. No more jumping across the border to get a visa in Cambodia, Laos or Malaysia. In fact the trend seems to be head back to your home country to get the visa there. For an American or someone from Europe that can eat up a week between the trip and turn around time. That is not a good thing for a company to see their non-Thai employees take a week off just to get a new visa. In fact that can be a strong consideration when deciding to start a company in Thailand, particularly so when key people are gone for a week. Other countries do their best to bring in investment, when Thailand sends mixed signals at the best. We want your money but not you is how it comes across.

All things considered, it is obvious the Thai economy is no longer robust enough to be selective on where it gets its money from. How the Thais treat ex-pats is a big consideration to the decision making bosses. Down time because of some visa requirement can only be viewed as negative, particularly when the CEO of that company must also make that week long visa run.

So the question is what will the Thai government do. Will they continue to discourage foreign investment by making non-Thais jump through unnecessary hoops, or will they simply make it easier to get and renew visas? It may not seem like much to some, but it can be the straw that breaks the camels back when neighboring countries have much sweeter offers and less hassles for investors.