Corruption is among the most prominent risks to foreign businesses operating in Thailand, according to a new report released by Maplecroft.
The report notes that corruption has exacerbated Thailand’s political instability; it weakens governance, undermines development and contributes to public dissatisfaction.
Corruption in government has regularly been cited as a trigger for coups, including the 2006 overthrow of Prime Minister Thaksin Shinawatra.
Interaction with public officials is fraught with the potential for corrupt practices, whether in seeking favourable terms for contracts or trying to expedite standard business activities, such as payment of tax or custom duty. However, the lack of legislation clearly criminalising business to business corruption means that companies also risk being implicated in corruption when dealing with other businesses.
"It is of the utmost importance that companies establish comprehensive internal compliance procedures to minimise the risk of legal action under Thai or foreign law," says the report.
Maplecroft notes construction and oil and gas as high risk sectors in which companies should take particular caution.