Doing Business in Thailand

In today post I continue to discuss the results of the World Bank Global Corruption Barometer 2009. Please see yesterday post on the same subject.

The third part of the survey was to determine which institutions nationals of each country believed to be the most corrupted.

WHICH OF THESE SIX SECTORS/ORGANISATIONS WOULD YOU CONSIDER THE MOST AFFECTED BY CORRUPTION?

Thailand is one of the world countries where perception of the corruption of political parties is the highest at 54%. Only Nigeria at 63% and Greece 58% have higher scores than Thailand in this regard. I guess that the political crisis that has affected Thailand for the past 3 years has something to do with those results.

Here again I have difficulty to understand why the Thai parliament seems to be scoring so well with a 6% score by comparison to the political parties at 54%. Indeed and as I was pointing yesterday, most members of the legislature are also members of the political parties that are deemed by Thai people to be so affected by corruption and I cannot seem to find a logical answer as to why such difference of perception.

Two sectors that is to say medias and judiciary are considered by Thai people to be the less affected by corruption than in the average total and Asian sample.

22% of Thais believe that the public service is affected by corruption. That is certainly not a good result for the Thai administration even if the results are far below the total sample average (26%) and the Asian Pacific average (33%).

Finally the last part of the survey was to try to determine how corruption was actually affecting each surveyed country.

IN THE PAST TWELVE MONTHS HAVE YOU OR ANYONE IN YOUR HOUSEHOLD PAID A BRIBE IN ANY FORM?

Liberia with a score of 87% seems to be the most corrupted country followed by Sierra Leone at 62%. Cambodia is Asia worth corrupted country with a score of 47% which is quite a paradox if you look at the results given in yesterday post.

How could Cambodian respondents perceives that corruption in their country is in the average of 3.0 points (1 is not corrupted at all 5 is extremely corrupted) when at the same time nearly 1 out of 2 respondents (47%) admit having paid a bribe within the last 12 months. By comparison Thailand has an average score of 3.3 points while only 11% of respondents (1 of 10) have admitted paying a bribe within the last 12 months.

It may actually be because Cambodian people judge that the two most corrupted organisations in their country are public services (26%)and judiciary (63%) while Thai peoble believe it to be political parties. Now the fact is that the average citizen may have to pay bribe to administration or to the judiciary, but the average citizen will certainly not have to bribe political parties. If anyone has a better explanation I would love to hear it.

It is a wonder what China, Myanmar, Laos, Vietnam or North Korea would have fared in this regard.

Thailand (11%) and Asian countries average score (10%) is far above the average scores of North American (2%) or European countries (5%).  Now of course this survey only takes into account people who have admitted to have paid a bribe and I guess that this is the reason why North America and Europe fare so well in this part of the survey. Indeed in North American and European countries awareness than paying a bribe is a criminal offence is higher than in Asian countries like Thailand and even in an anonymous survey some people might have some difficulties to admit that they have committed a criminal offence. Also in North America bribing takes other forms (for example lobbying).

So what does I think of this survey. While I think this survey is interesting I do not think it is an accurate tool to judge the extent of corruption in the country surveyed. Indeed most of the survey is about people perception that is to say subjective. As to the last part of the survey I explained above why the results were in my opinion not accurate.

What is bad with this kind of survey is that the press when reporting the results is forgetting to mention that most of this survey is about public perception. In other words it is a subjective survey with subjective results. As to my practical experience doing business in Thailand it is mixed. Our company has assisted over the past 8 years hundreds of foreign investors to incorporate their business, to apply and obtain their visas or their work permits or to obtain their business licenses and my employees are constantly in contact with most Thai administration departments (Revenue Department, Ministry of Commerce, Immigration, Labor Department, and Land Department) and so far our work was nearly never impeded by corruption or bribe requests. At the same time I’m a motorist and I had to pay my share of traffic fines on the spot, and I’m also aware that you may not do business in certain spheres without having to pay tea money.

Overall while Thailand is not corruption free (no countries are) the average businessman should not be worried about this issue when coming to do business in Thailand because for as long as you do business within the framework of the law and do not expect to obtain advantages that you may not legally receive the chances are that you will not be affected by it.

About the Author:

The author Rene-Philippe DUBOUT is a lawyer since 1990 when he was admitted to Geneva bar (Switzerland). He practiced as a litigator there for 10 years until he moved to Thailand in 1999. In 2002 he founded with a group of Thai lawyers Rene Philippe & Partners Ltd a local law firm that specialized in Cross Borders Investments and Real Estate. He has been lecturing in several Thai Universities and a speaker to numerous conferences and seminars. He is the author of a must read book:”How to Purchase Real Estate Offshore Safely: The Case of Thailand”.

http//:www.renephilippe.com

© Copyrights 2009 – Rene Philippe Dubout – This article may be reprinted if information about the author, the websites, and the URLs remain intact.

Originally posted 2009-10-01 02:35:23.

Related posts:

1. Doing Business in Thailand: Global Corruption Barometer 2009
2. Doing Business in Thailand: Local Corruption Barometer
3. Doing Business in Thailand: Understanding Thai Administration
4. Doing Business in Thailand: Corruption Index 2011
5. Starting a Business: The One Start One Stop Investment Center
6. Doing Business in Thailand : How difficult can it be?
7. Doing Business inThailand: Understanding Thai Legal System
8. Doing Business In Thailand: Is it easy to be successfull?