Political Risks of Trading in Thailand

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Thailand lies on both democratic and authoritarian leadership. It is best to classify the country as a hybrid regime because democracy is limited to certain conditions. At the same time, the military can take over the government at any point and create an authoritarian government. Thai citizens have the right to overthrow governments and political leaders if they deem their leadership unfit. However, practicing this right whenever the citizens or influential people feel like it is not a democracy while military power has more authority over the nation. Since 1932, the country has undergone more than 30 attempts of a coup, with the recent being in 2014 indicating the democratic effects of the nation (Goswami & Panthamit, 602). Basically, Thailand’s leadership under Junta is authoritarian and lacks the necessary aspects of democracy.

Thailand’s political unrest and coups are critical concerns to local and foreign businesses operating in the region. The 2006 and 2014 coups, in particular, raise a concern about economic policies, currency value, foreign investment ownership, and a decline of the country’s economy (Goswami & Panthamit, 610). Although Thaksin’s laws and policies liberating foreign investments and tirade still apply, one never knows when the military will change the constitution and change the policies. Consequently, the constant Muslim and government conflicts pose security challenges to foreign investment, which needs consideration (Goswami & Panthamit, 610). As the CEO, I would continue investing and trading with Thailand while taking note of a strict security setup, keen observation of the political climate, and being updated on changes in economic and foreign investment policies. Taking note of the three aspects will help avoid disruptions and losses in foreign trade.

Having an existing market in Thailand is different from venturing into business during the country’s political. Despite the political risks, the existing market can survive due to already formed international relations and partnerships. However, new businesses face the challenges of changing laws and policies, legal documentation, security, and economic instability, which affects currency exchange. The judicial process and obtaining new contracts may be costly in Thailand due to political conflicts and the struggle for power among different groups. Therefore, I would find alternative markets for imports and exports until Thailand gains political and economic stability.

Work Cited

Goswami, Gour Gobinda, and Panthamit Nisit. “Does political risk lower bilateral trade flow? A gravity panel framework for Thailand vis-à-vis her trading partners.” International Journal of Emerging Markets (2020). Vol. 17 No. 2, pp. 600-620.

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DemoEssays. (2023, January 4). Political Risks of Trading in Thailand. Retrieved from https://demoessays.com/political-risks-of-trading-in-thailand/

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DemoEssays. (2023, January 4). Political Risks of Trading in Thailand. https://demoessays.com/political-risks-of-trading-in-thailand/

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"Political Risks of Trading in Thailand." DemoEssays, 4 Jan. 2023, demoessays.com/political-risks-of-trading-in-thailand/.

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DemoEssays. (2023) 'Political Risks of Trading in Thailand'. 4 January.

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DemoEssays. 2023. "Political Risks of Trading in Thailand." January 4, 2023. https://demoessays.com/political-risks-of-trading-in-thailand/.

1. DemoEssays. "Political Risks of Trading in Thailand." January 4, 2023. https://demoessays.com/political-risks-of-trading-in-thailand/.


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DemoEssays. "Political Risks of Trading in Thailand." January 4, 2023. https://demoessays.com/political-risks-of-trading-in-thailand/.