October 26, 2022
BANGKOK – Thailand has the highest income inequality in east Asia, with rural households bearing the brunt of poverty challenges, according to a new report by the World Bank.
The report, titled “Thailand Rural Income Diagnostic”, said the national poverty rate has fallen from 58 per cent in 1990 to 6.8 per cent – but has been rising since 2016.
The situation is especially bad in rural areas, which account for 79 per cent of the poor, mainly in agricultural households.
The poverty rate in rural areas was 3 per cent higher than in urban zones in 2020.
The bank cited the slowing economy, stagnating farm and business incomes, and the Covid-19 crisis as reasons for Thailand’s rising poverty rate.
Worst affected by poverty are the South and Northeast, with rates almost double those of the national average, according to the report.
Meanwhile, the average monthly income for rural households was only around 68 per cent of urban households. The report said rural households are also suffering from low education levels, a high number of dependents, and difficult living conditions.
“Thailand has the potential to support faster and sustained income growth of rural households,” said Fabrizio Zarcone, World Bank country manager for Thailand.
“As Thailand’s economy adjusts to a new normal post-Covid-19, policy measures that increase agricultural productivity, support diversification to higher value crops, and improve access to markets through better rural connectivity and digital technology adoption can help overcome the constraints faced by the rural poor,” he added.
The report also forecast that the economic impacts of the Covid-19 crisis would linger longer in rural areas than in cities.