“Black Hole” of Corruption Looms in Thailand

Former Asean secretary-general and Thai foreign minister Surin Pitsuwan says “corruption threatens to turn Thailand into an investment “black hole” of Asean as it makes doing business in the country far too costly”, according to a front page article in the 13 October Bangkok Post.  Mr. Surin said corruption in Thailand had reached the crisis point, saying:

  • The cost of corruption adds 30-35% to any investment in Thailand.
  • The amount of foreign direct investment to Thailand dropped by 24% between 2007 and last year.
  • The Global Corruption Barometer 2013 survey showed foreign investors in Thailand were most concerned about corruption.
  • Corruption costs Thailand about 100 billion Baht per year.

Mr. Surin said Thailand should become a party to the Organization for Economic Development and Economic Co-Operation’s Anti-Bribery Convention (OECD Convention).   40 Countries have adopted the OECD Convention, all 34 members of the OECD and six other countries.  The OECD Convention is largely modeled on the U.S.’s Foreign Corrupt Practices Act (FCPA), and the FCPA was slightly revised in 1998 to make it consistent with the OECD Convention.

There has been a marked increase in FCPA investigations and prosecutions in the U.S. leading to, for example, the imposition of a fine of US$1.6 billion and the imposition of lengthy prison terms on persons found to have violated the FCPA (e.g., 15 years in one recent case).  There has also been a marked increase in enforcement activity by many of the countries that are parties to the OECD Convention.   According to a report from the respected corruption watchdog organization Transparency International, the U.S., the U.K. and Germany have the most robust and active anti-corruption enforcement regimes.  For more information about anti-corruption laws in Thailand, visit the anti-corruption section of the Knowledge part of our website by clicking here.