For the second year running, FinanceAsia has ranked the finance ministers of the Asia-Pacific region’s 12 largest economies.
FinanceAsia considers several factors when thinking about how to compare the performance of these men over the past 12 months. The role’s responsibilities and powers vary between countries but each minister contributes to fiscal policy and the budget, accesses capital markets, regulates financial institutions, and drives reform. Investor perceptions are one way to view how good a job they are doing, particularly when times are tough.
But the hardest criterion is independence. Most finance ministers serve at the pleasure of their prime ministers, presidents, or military dictators. Their ability to get things done requires political deftness, mastery of policy, sway over the bureaucracy, and the will to fight for the public interest.
And few ministers face as big a challenge to exert their independence as the next minister on our list.
Ranked No11: Apisak Tantivorawong, Thailand
Thailand had a year to forget in 2015. Annual gross domestic product growth was only 2.5%, way below its average.
In large part this was down to the ruling military junta, headed by Prayuth Chan-ocha. Since evicting the government of Yingluck Shinawatra in 2014, the military government has focused on legitimising its rule while trying to curtail the ongoing popularity and influence of Thaksin Shinawatra, the fugitive former prime minister.
The frail health of the country’s beloved but elderly king and the unpopularity of his son has bolstered this motivation, and while an election is scheduled for 2017 it’s uncertain the junta will relinquish power.
The result has been falling exports, low consumer confidence, and plummeting foreign investment. Foreign company applications for investment between January and November 2015 fell by 78% from the same period in the previous year, to Bht93.8 billion ($2.59 billion), according to the Board of Investment.
Analysts say Thailand’s political climate and a dearth of highly educated technical personnel means foreign car manufacturers, which are some of the country’s biggest investors, are considering investing into nearby nations such as Indonesia.
Thailand’s shifting financial leadership hasn’t helped. In August the junta reshuffled its economic council, replacing Deputy Prime Minister Pridiyathorn Devakula, the original head, with Somkid Jatusripitak. Additionally, the finance minister, Sommai Phasee, was eased out in favour of Apisak Tantivorawong, former president of Krung Thai Bank.
Apisak appears to have limited influence. Somkid, a former finance minister under the populist Thaksin, is leading the government’s economic effort with similar crowd-pleasing tricks to his previous stint in government. For example the government has introduced the Bht100 billion ($2.8 billion) Village Fund, which will offer cheap loans, and it bought 100,000 tonnes of raw rubber at an inflated price of Bht45 a kilo.
These efforts may be popular but they will drain government funds and are unlikely to leave any lasting economic benefit. Thailand’s economy may grow faster this year but its foundations remain worryingly weak.
The government should really focus on getting large-scale infrastructure projects moving. In fairness, it has earmarked Bht400 billion for this purpose. Some analysts hope the junta can get them done but the country does not have a positive track record for executing in a timely fashion.
The good news? Public debt, at 32.6% of GDP in November, is relatively low.