The impact of the global food, fuel, and financial crises and policy responses:

1. The impact of the global food, fuel, and financial crises and policy responses: A Child-sensitive Approach Suwanee Khamman Deputy Secretary-General Office of the National Economic and Social Development Board of Thailand

2. Outline • The economic crisis: its causes and consequences • The 1997 crisis • The 2008 crisis • Policy responses to the crisis • Responses to the 1997 crisis: Lesson learned • Responses to the 2008 crisis : 2-stimulus packages • Challenges: Sustainable development • Quality and accessibility • Affordability • Decentralization

3. Overview of the impact of the world economic crisis on Thailand Social impact Economic – social envi. Prior to crisis ie; global warming, the volatility in food and oil price Reduced OT payment/Salary Layoff Unemployment among recent graduates Return to homeland Social problem World economic crisis* Economic impact Lower export Financial institutions in G7 continue to collapse until Q1/ Stock and bond unresponsive to the Rescues Plan Bill Shrinking tourism industry Unemployment Lacking liquidity in the world market Lower consumption Biggest depression in U.S., Japan, E.U. in 70 years Stable oil and agricultural product price until Q2 of 2009

4. Thailand 1997 Crisis Causes • Careless financial liberalization • Loss in competitiveness • Overconsumption of imports Consequences Education • Increase in dropout rates • Lower quality of education • High unemployment among recent graduates Health • Increase in malnutrition rate in rural and urban area Social aspect • Increase conflict within the family due to financial pressure • Increase in child labor, street children

5. Responses to the 1997 crisis Policy Implications Education • Free education as a safety net for children during the crisis • Health • Need for a universal health care scheme with non-contributory financing for the poor • Community • Local community empowerment as a social security for the crisis Lessons Learned • Vulnerability of children, the elderly, and the socially excluded to the crisis • Various impacts of the crisis on children • Capacity of the Thai local community to absorb unemployment from the crisis • Health care no longer affordable by those inflicted by the crisis Four Measures Stabilizing the economy, restructuring financial institutions, restoring confidence. Reducing overall public expenditure, but safeguarding investments in social sectors. Providing protection to the unemployed and vulnerable groups Addressing long-term structural impediments in the Thai economy.

6. 2008 CrisisTruly Global Problem Causes • Financial collapse in the U.S.A. and European countries • Rapid transmission via globalization process • Inadequately prepared and imbalanced social structure unable to withstand the crisis Consequences Unemployment • Rapid unemployment rate from both newly graduates and laid-off workers • Inability of the local community to absorbed the unemployed Export • Export shrinkage due to declined real income of trading partners • Need for domestic stimulus for the economy Education • Positive outcome on return to education of the temporarily unemployed Concurrent Issues • Increase in food and oil price • Global warming : climate change • Internal political instability

7. Response from the Government Financial support March 2009 Sept. 2009- Sept.2011 Stimulus package 1 • Income generating measure • Building grass-root economic potential via sufficiency economy fund • Creating income insurance for senior citizens • Promoting proactive role of village health volunteers • Reducing cost-of-living and social investment measure • 15-year free education • Income subsidy via cash transfers • 5-measures 6-months program • Unemployment alleviation and capacity development measure • Strengthening capacity of the unemployed • Reducing lay-offs and labor mobility Stimulus package 2 • Enhancing food and energy security • Upgrading public infrastructures to improve economic competitiveness • Improving income-generating capacity of tourism sector • Creating new income-generating sectors in the Creative Economy • Upgrading quality of education and holistically modernizing learning system • Raising quality of public health care system . • Creating jobs and increasing incomes for people at the community level Short term response Create 1.5 million jobs within 3 yr.

8. Stimulus PackageII Public Infrastructure837,642Mil-Baht Community91,708Mil-Baht Public Health 10,441Mil-Baht Creative Economy17,585Mil-Baht Water System/ Agricultures238,515Mil-Baht Tourism 8,506Mil-Baht Education53,969Mil-Baht Program1.43Tri-Baht Learning Community Building Water Management Development Programs for 5 Provinces in Southern Thailand Sub-Program Production and Strengthening Capacity of Medical and Health Care Staff Transport & Logistics Image Revival Cultural Heritage Conservation and Restoration Alternative Energy Tourism Marketing Technology& Standard Improvement for Agricultural Sector Investment Programs for Job Creation and Income Generation in Communities Creative Tourism Products Quality and Standard Improvement on Education and Learning System Arts and Cultural Town Telecommu-nication Research and development of medical technology Intellectual Infrastructures Improvement plan and Center of Education in sub-region and region Tourism Site Recovery Thai Handcraft Promotion Education Creative Product Promotion Avoid water crisis The prospect of climate change, The decline of small family farm . Aim to secure food supply Standard Improvement Natural Resources Thai Software Industry Promotion Public Health Quality Improvement on Teachers and Education Reform Social Security Design Industry and R&D Promotion Science & Technology Midium and Long term obj. : enhance national competitiveness / generate employment

9. Challengeswhat are the challenges remain… Quality and accessibility • An equitable distribution of health services (quality) • Efficiency of the public education system; the quality of public education and Well-educated workforce . • Social inclusion of individuals outside the formal social protection scheme • A domestically driven economy that make the country resilient to external crises. • rural and urban poor are well targeted  (access to food)/ vulnerable to price rise Affordability • The rapidly aging demographic structure • Pressure on the sustainability of the health insurance scheme • A sustainable old-age pension program that covers basic minimum needs • Carefully crafted social protection system without insolvent public deficit • Targeting cash transfers to the chronic poor • Need for accurate poverty data, and economic modeling of impacts of existing projects Lack of information regarding program response and coverage .

10. How to cope with the challenges Comprehensive outreach system • To channel to the needy in the most effective and efficient manner- area based approach • Strengthening decentralization and community empowerment • Establishing community based social protection programes • Proposed steps include: • Improving area-based budget allocation process • Coordinating with local governments in delivering services • Delegating some tasks to selected NGOs / civil society for particularly targeted gr. • Training assistance to officials to locate the poor and monitor the effectiveness of the program Sufficiency economy : Guiding principle • shaping the policies and practice of the Thai government, to create a balance amidst external and internal changes • Helping minimizing the vulnerability of the poor to economic and social shocks in various ways: • human-based projects that generate an equitable distribution of benefits. Focus on small-scale • Greater self-reliance • Improving standards of governance in public administration

11. THANK YOU