United Nations endorsed Thai Buddhist Economic model
Kalinga Seneviratne
SUFFICIENCY ECONOMY: In the last two decades, Buddhism's appeal has
grown in the West, drawing people seeking a calm not found in the
fast-paced world of Internet-driven commerce and communications.
While Bhavana (Buddhist meditation), has become a form of modern
psychotherapy and influenced Western lifestyles, is there anything in
the religion's 2500 year old teachings, which could influence modern
economics?
According to Thailand's much revered King and lately members of the
(new military installed) government and a growing number of economists
and grassroots development activists, the answer is, yes, there is. They
call it 'Sufficiency Economics', a term coined by King Bhumibol
Adulyadej in the midst of Thailand's economic meltdown in 1997.
It embraces the three pillars of Buddhism - dana (giving), sila
(morality) and bhavana (meditation) - and is based on the Buddhist
principle of the 'Middle Path', that is avoidance of extremes (of
greed).
The Thais have recently got a strong endorsement of this Buddhist
development strategy from the United Nation's main development agency.
In a report released in January, the United Nations Development
Programme (UNDP) hailed Thailand's new "Middle Path" development model
as a key to fighting poverty, coping with economic risk and promoting
corporate social responsibility.
The UNDP's 'Thailand Human Development Report 2007: Sufficiency
Economy and Human Development', a result of a year-long collaboration
between Thai and international experts, is designed to bring Sufficiency
Economic thinking to a wider international audience.
UNDP describes 'Sufficiency Economics' as a set of tools and
principles that help communities, corporations and governments to manage
globalisation - maximising its benefits and minimising its costs - by
making wise decisions that promote sustainable development, equity, and
resilience against shocks. Thus, the report says that the 'Sufficiency
Economy' is a much needed "survival strategy" in a world of economic
uncertainty and environmental threats.
"We believe that Sufficiency Economy principles are applicable around
the world, especially for rapidly-developing countries that are
experiencing some of the same pressures as Thailand" said Joana Merlin-Scholtes,
UNDP's Resident Representative in Thailand.
This model may perhaps offer some insights on how to tackle some of
Sri Lanka's own economic woes and development problems UNDP report goes
on to explain what Sufficiency Economics means in practice.
For communities, Sufficiency Economics principles are fundamental to
empowerment and building resilience, such as setting up savings groups,
revolving credit lines, and local safety nets. For private business it
means, "taking corporate responsibility to the next level" by using this
approach as a guide to management and planning.
"This approach encourages them to focus on sustainable profit, to
adhere to an ethical approach to business, to pay special attention to
their employees, to respect nature, to have careful risk management, and
to grow where possible from internal resources" the report explains.
And for the third pillar, the governments, the Sufficiency Economy is
central to alleviating poverty, promoting good governance, and guiding
macroeconomic policies to immunise against shocks.
UNDP believes that Sufficiency Economics is a naturally ally of human
development, but it also offers two additional elements - placing
greater emphasis on mental and spiritual development, and offers
guidance on how to make decisions that will achieve sustainability,
well-being and happiness.
Thailand plans to write into the preamble of the interim constitution
that is being written right now the principles of Sufficiency Economics.
The official Thai definition of the economic model drawn up in 1999
describes it as "an approach to life and conduct applicable at every
level from the individual through the family and community to the
management and development of the nation".
Dr. Sumet Tantivejkul, former chief of Thailand's National Economic
and Social Development Board (NESDB) and currently the secretary-general
of the Chaipattana Foundation under royal patronage, argues that it is
not correct to suggest that Sufficiency Economics was suitable only for
the poor and grassroots communities, while everyone else follows the
Western capitalist and consumerist economic model.
Citing the unrelenting growth of the world's population and global
competition for natural and other resources, to match growth in
consumption, which has already outgrown Mother Nature's capacity to
replenish by a ratio of 3:1, he argues the mainstream economic model
could only lead us to disaster and conflict.
Dr. Sumet points out that only 4 percent of the benefits of
Thailand's decades long economic growth (until 1997) has trickled down
to the country's poor who constitute 60 per cent of the population,
while Thailand's middle class women are renowned for being world-class
shoppers - second only to those from Hong Kong - for spending as much as
US$ 1000 on designer-labelled handbag when they go shopping abroad.
Dr. Sumet argues that Sufficiency Economics is what Western
economists call 'risk management' and the Thai model sees this path as
one which develops an economic policy on moderation, rationale and
immunity. He cites the revival of the Siam Cement Group, which is
Thailand's largest company, as a good example of how Sufficiency
Economics could be applied to risk management.
When the 1997 economic crisis hit Thailand, Siam Cement had over 200
subsidiaries and was saddled with an unprecedented huge foreign exchange
debt due to the currency depreciation, and was on the brink of collapse.
"The crisis exposed the perils of its excessive growth.
It was monolith - way too big and too fat" noted Dr Sumet. "After
several years of drastic restructuring and selling of its non-core
assets, the group, now with only about 100 subsidiaries, has returned to
health. It has just reported its highest profits in 35 years".
NESDB's secretary-general Ampon Kittiampon argues that Thailand does
not need high economic growth for sustainable development, all it needs
is about 4 percent growth rate that can absorb new entrants to the job
market.
He criticises the deposed government of Prime Minister Thaksin
Shinawatra (one of Thailand's wealthiest businessmen) for using public
spending to increase consumption and hence growth, and also for using
government investments for helping his business cronies.
Raising ethical standards for economic management and getting rid of
conflicts of interest and introduce transparency are also part and
parcel of Sufficiency Economics argues Ampon.
Thailand's current push for a Sufficiency Economics development path
really began in 1999 when many of Thailand's top economists gathered to
discus the King's thinking on the economy to get the country back on its
feet.
They concluded that the country had clearly ignored moderation by
indulging in over-consumption, which reduced the volume and savings and
increased the reliance on foreign debt. Thus, Thailand needed a degree
of self-reliance because they could not predict the shocks of the
globalised era. However, the then Prime Minister Thaksin did not agree
with such economics, which created much friction between the Palace and
the Prime Minister.
The UNDP report gives many examples of how the Sufficiency Economy
model has been implemented in many parts of Thailand, encouraged by
models set up under royal patronage across the country.
One such example is of Chumphon Cabana resort, which shows that, the
benefits of the 'Sufficiency' approach is not just confined to the
agriculture sector. In the crisis of 1997, this resort on the east coast
of the peninsula suffered financial difficulties like so many other
businesses. In the desperate attempt to stay afloat, the owner took
inspiration from the Sufficiency approach.
As a start, she began to plant rice, vegetables, flowers and fruit
trees on land within the resort project. To improve the sandy land
without the cost of chemicals, she experimented with making organic
fertilizer from hotel waste and other materials.
She planted a local variety of rice and installed a rice mill. The
husk was used in making the fertilizer and for animal feed. As the
resort's land was not enough to supply all its needs, she got the
cooperation of surrounding villages to supply the deficit, and also
helped train them in making fertilizer and other practices of organic
farming. The employees of the resort were especially encouraged to
participate.
Next she invented a just-in-time system of supply by posting the
following day's requirements of various articles on the local school's
notice board. Local production expanded beyond food to include various
cleaning materials made from local materials.
As production increased, these articles were also supplied to other
resorts in the area. The resort benefited from low production costs and
reliable supplies. Surrounding farmers had a secure market and good
prices because there were no middlemen.
Soon the resort gained a reputation with the result that other resort
owners, farmers, NGOs, and government officials came to learn - which
gave the employees a sense of pride. As the owner concluded, "I think
this is a kind of development which makes everybody happy."
In a 1998 statement on the essence of the Sufficiency Economics
model, King Bhumibol said: "Sufficiency is moderation. If one is
moderate in one's desires, one will have less craving. If one has less
craving, one will take less advantage of others. If all nations hold to
this concept, without being extreme or insatiable in one's desires, the
world will be a happier place". |