Thailand: Many Business Cultures

2000

Dr Craig J. Reynolds

An understanding of business cultures helps to explain the attractions of a politician such as Thaksin Shinawatra, who is offering entrepreneurial aggression rather than constitutional reform as an answer to Thailand's economic woes. Powerful connections can mean profits for a businessperson, and a party leader unafraid of trumpeting the importance of such connections will win many votes.

Thaksin, an entrepreneur whose success has been built on telecommunications, heads a new opposition party, Thai Rak Thai ('Thai Love Thai'). Many of his early business connections were forged with the security services, such as the police. Thai Rak Thai is seen as posing the greatest challenge to the Democrats, led by Prime Minister Chuan Leephai, in the next election.

A recent invitation to give a talk to a group of MBA students on 'business cultures' in Thailand forced me to think a little about what the term actually means. Generally it refers to the social, cultural, political and legal settings in which business is conducted. The emphasis should be on the plural. There are many different settings in Thailand in which business is conducted.

Bangkok's predecessor as the dominant Thai centre in the lower Chaophraya River basin was Ayutthaya, a port polity that had trading links through the Middle East to Europe in one direction and to East Asia in the other. Bangkok, which inherited Ayutthaya's legacy as a port polity, has also been the administrative centre of the kingdom over the past two hundred years. Business and bureaucracy have always coexisted peacefully in Thailand's history. Many of the monarchs were merchant princes.

The collaboration between business and bureaucracy goes a long way towards explaining the business streak in Bangkok's political heritage and culture. But it also points to some of the problems. The separation between public and private economic activity is often indistinct, and illegal economic activity often has official connivance. It is easy, perhaps irresistible, for politicians and police to get involved with 'dark influences.' Many scandals - bank fraud, the production of pirated goods, four decades of delay in the construction of the second international airport, to name but a few - can be traced to entanglements of business and bureaucracy. Marriages often seal these entanglements.

At this millennial New Year, one also thinks of the enormous importance of gift giving in Thai society. At New Year businesses and families engage in a furious round of gift exchanges to affirm existing relationships and to build up ones that hold entrepreneurial promise. Gift giving of course has religious and social meanings in Thailand. For Buddhists an offering to a monk or a monastery brings the giver a quantity of merit. And gifts to patrons, employers, and bosses are declarations of deference, gratitude for favours bestowed, and loyalty, that sustain and complicate the cultures of business.

WATCHPOINT: Does Thaksin Shinawatra's entrepreneurial aggression signal a new kind of economic dynamism or the embrace of a familiar culture of doing business in Thailand?

 

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