Effects of the Bowring Treaty on the Siamese economy
The story of Thailand after the Bowring Treaty.
The signing of the Bowring Treaty was a pivotal event that marked a turning point in Siam's economic transformation. Both in terms of international trade and especially changes to the domestic economy. This article describes the effects of the Bowring Treaty on Siam's economy.
Overview of the Siamese Economy and the Bowring Treaty
Although the "Bowring Treaty" had a significant effect in transforming Thailand's economic system by changing from a "subsistence economy" to an "open economy" with formal production processes and the use of money as a medium, in exchange While the international economic policy of Siam country had to change from "Monopoly trade" by warehouse monks by switching to "Free Trade."
The Bowring Treaty was an important tool linking the Siamese economy to the European economy. Siam's geography had a comparative advantage in cultivating rice to meet the growing demand for rice from the world market1, especially on the side of the people. The effects of the Bowring Treaty have significant implications for encouraging the Thai people to produce commodities, particularly rice, to meet global demand and make Thailand a top rice producer and exporter2. Other parts of the world
However, the nature of Siam's production of goods concentrated on primary commodities, especially rice, which would become Siam's main export until the 1960s. That Still relies on a semi-industrial production process. Therefore, it cannot compete with sugar production in the Philippines or Java. Causing the sugar sales business of Siam to be sluggish.3
Due to the nature of primary goods that do not go through industrial production, the price of goods is low compared to labour. And the resources expended on rice production, especially the land that has been cleared in the area. Which is the current Rangsit Canal, And the country's central region is used for rice cultivation. Therefore, the Central Plains area was fully drawn into the European economic world. While the Northeast's economy thrived from forest trade with the world, China's economy deteriorated as it failed to meet the needs of the European world economy.4
This image would become the foundation of the economic structure of Siam. This continued to be a problem during 1930 (2473 B.E.) and led to the Apiwath Siam, changing the government from absolute monarchy to democracy to change the economic structure of Siam.
Effects of the Bowring Treaty on the Siamese Labor Market
Entry into the capitalist economy has increased the importance of money. Taxation and trade, while agriculture and workforce control as a source of wealth and power, have diminished in importance.5
As already mentioned, The Bowring Treaty changed the production methods in Siamese society, making labour necessary. Which is affiliated with the foundation of the feudal system
Therefore, the "abolition of the pro-slave system" will create an efficient labour market and have the potential to produce6, causing later King Chulalongkorn to have the policy to abolish the pro-slave system. This freed workers to be able to work in the new production system. At the same time, the government sought more tax benefits which later led to plans for fiscal reform in taxation. This will help solve the country's budgetary problems arising from the feudal system, as explained in the next section.
Effects of the Bowring Treaty on the Treasury of the Siamese State
As a result of the "Bowring Treaty", which required the Siamese government not to collect more than 3 per cent in taxes, the Siamese government could not use taxation policies in seeking income for industrial development or other areas of economic growth. Entirely because the tax is quite limited7, together with the characteristics of the tax collection structure during the years 1855 until 1925 that is attached to the original feudal system that has been inherited since the Ayutthaya period
The monarch divided the power of collecting taxes amongst some nobles and high-ranking royal families. They were making tax collection into the treasury less feasible Because those high-ranking nobles and royalty would set aside some of the money collected from their duties to be deducted as expenses for their work and send the treasury only a tiny amount. As a result, the treasury had few assets.
The Treaty of Bowring reduced the role of the treasury, and the collection of taxes was distributed among the various lords. (see the Table)
Table: Data on the distribution of tax collection among the Thai elite
The taxation structure under the feudal system was, therefore, more like dividing the cake between the elites of Siam. At the same time, the royal court and the monarch receive only a tiny fraction of the money. The viziers regarded taxation under their control as personal property. And use every opportunity not to have to pay money into the treasury by considering that bringing income to the treasury as a certain amount is the right thing to do8.
Thus, although Siam's economy was expanding, the treasury, which was the repository of the state's money, benefited very little in this regard. This led to the need for new fiscal reforms by consolidating tax collection power in the Ratsakorn Phiphat Hall and the Ministry of the Treasury. It is a budgetary reason to support the expansion of the new bureaucratic system and create a new tax type to seek income for the government.
Impact in terms of rice production, the Siamese state's important commodity
As mentioned above, rice became Siam's main export after the Bowring Treaty. Siam's labour and land were allocated to more commercial rice production. This production process has replaced the traditional way of life that emphasizes the household as a unit of production for subsistence and household consumption, such as making handicrafts such as textiles.
When Siam became part of the global economy through trade with England, Domestic production, especially textiles, was decimated by cheaper foreign commodities due to industrial production methods. Most of the labour used to produce other goods was used in rice production. And with the popularity of rice production, labour mobility has significant implications. Because when Siam made the Bowring Treaty and opened free trade with England and Europe, Rice production required a large amount of labour, resulting in an influx of workers from other regions of Siam, especially in the Northeast. Which initially benefited from forest trade with China
The production of rice for export brought about four Siamese government policies that affected the expansion and growth of rice exports.9
First, the development of international transport systems, i.e. after the Bowring Treaty, which occurred at the same time as the Suez Canal excavation (14 years after the Treaty), resulted in a reduction in distance and cost. Transport between Europe and East Asia caused the demand for rice from Thailand to increase rapidly. The reduced cost of shipping has led to investments in the use of steamboats to transport rice, which has been successful in exporting large amounts of rice. This incentivizes peasant workers to grow rice for hire instead of growing rice for their subsistence consumption.
Second, the development of domestic transportation systems. The government has dug a canal to support rice production for export. More than 15 canals have been explored to connect Bangkok and the central plains. Especially from 1860 to 1910, many trenches were dug for farmers to produce rice for export. The government has given a lot of concessions to explore channels. In addition to the track, the government has invested in building a railway to connect Bangkok to other regions of the country, which will affect cultivation, although different from the canal route.
Third, population growth. Since the 19th century, medical and scientific advances have resulted in a sharp decline in the death rate. The population of Asian and European countries has increased. But this has also increased the domestic rice consumption market.
Fourth, the policy abolished commoners and enslaved people and tax policies, as mentioned above.
As can be seen "Bowring Treaty" had a significant impact on the country's economy in many dimensions. It also affected the political structure and context of Siam.
Several policies were implemented during that time. Linked economically and politically And this has become the foundation of Thailand's economic and political structure. Until the present, after the Apiwat changed the government of Siam.
กุลลดา เกษบุญชู มี้ด [Kullada Kesboonchoo Mead], ระบอบสมบูรณาญาสิทธิราชย์: วิวัฒนาการรัฐไทย [The Rise and Decline of Thai Absolutism] (อาทิตย์ เจียมรัตตัญญู [Athit Cheamrattanyu] tr, ฟ้าเดียวกัน [Same Sky] 2019) 63.
พอพันธุ์ อุยยานนท์ [Phophan Uiyanon], ประวัติศาสตร์เศรษฐกิจแห่งประเทศไทย [Economic History of Thailand] (สำนักพิมพ์จุฬาลงกรณ์มหาวิทยาลัย [Chulalongkorn University Press] 2021) 15.
supra note 1, 63.
ibid 63.
ibid 79.
ibid 90.
supra note 2, 14.
supra note 1, 66.
supra note 2, 16 - 21.