Black Market Economies

[Snick]

http://finance.yahoo.com/banking....nVzaW5l

A report identifies countries with the largest shadow economies, many of which are half as large as official GDP€”a huge loss in tax revenue...

Thailand is #7 in the list, but if you look at the size of the economy ($538 bn), Thailand is the largest in size, black market economy in the top 10.

[TTChang]

Hell, this is a bit of a shock ....

[Road Runner]

I make that  US$81800/person!  

I don't think that's to odd 500 Baht here or there going to the police.
It's got to be people well up the food chain helping themselves.
And I have no doubt that at least some further up know it.

Be interesting to know the UK figures - I'm sure all those recent immigrants
from Nigeria, Kurdistan and the old communist states are paying their taxes.

RR.

[Jake_Sully]

From what I've been told courtesy of family living in LOS, there is a huge black market for forgeries of passports and such. On occasions of visa runs you might have seen huge lines of people trying to get visas into LOS. Why? Its not because they all want to live there, they want to get passports/ papers that allow them to enter Europe or North America.

Watch your passports gentlemen. They're easily worth $20,000.00 in the wrong hands and people are willing to pay. The thai's are masters at taking out the original photo and replacing it with the customers and making it appear genuine.

That might come up in the economic figures too say "rent collected" from some phantom property.

[manarak]

(Jake_Sully @ Aug. 01 2010,19:12) From what I've been told courtesy of family living in LOS, there is a huge black market for forgeries of passports and such. On occasions of visa runs you might have seen huge lines of people trying to get visas into LOS. Why? Its not because they all want to live there, they want to get passports/ papers that allow them to enter Europe or North America.

Watch your passports gentlemen. They're easily worth $20,000.00 in the wrong hands and people are willing to pay. The thai's are masters at taking out the original photo and replacing it with the customers and making it appear genuine.

That might come up in the economic figures too say "rent collected" from some phantom property.

Watch your passports gentlemen. They're easily worth $20,000.00 in the wrong hands and people are willing to pay. The thai's are masters at taking out the original photo and replacing it with the customers and making it appear genuine.

That's not how it's done nowadays.
Photo replacement only works on old passports.

Now, they search for someone with a strong resemblance with their client and make sure the original owner doesn't complain.
(usually this involves a financial transaction with the original owner, so don't stress out)
EU-passports can be had for as low as 2000EUR.

The big advantage is that these passports are not forged.

[PigDogg]

On first glance, a huge underground economy sounds like a bad thing.

But it also means that the official figures underestimate reality.

And it is not all forged passports, Pattaya prostitutes and bootleg software.

Somchai, the pok pok vendor, and his brethern are a big part of the underground economy. It is not all nefarious.

[kahuna]

(Jake_Sully @ Aug. 01 2010,19:12) On occasions of visa runs you might have seen huge lines of people trying to get visas into LOS. Why? Its not because they all want to live there, they want to get passports/ papers that allow them to enter Europe or North America.

Sorry but I've never seen "huge lines of people trying to get visas" or entry stamps to get into Thailand...But perhaps I've just been going to the wrong border...

[Road Runner]

(PigDogg @ Aug. 01 2010,16:40) On first glance, a huge underground economy sounds like a bad thing.
But it also means that the official figures underestimate reality.

Somchai, the pok pok vendor, and his brethern are a big part of the underground economy.  It is not all nefarious.

Fully agree with you PD  -  several financial experts in the UK have said exactly the same thing.


But to cruch the numbers another way (if they are correct) Somchai is making 7000 Baht/day, 2.6 Million/year  -  EVERY Somchai in Thailand.    

Most of the population are close to the minimum daily wage of 180-210 Baht/day.
A small shop in Issan makes about 500 - 5000/day  -  supporting about 2-5 people  =  250 - 1000/person/day.
You could probably double or treble the figures in a big town or Bangkok.
A large shop will probably do better but will pay taxes.

Rental on a Thai apartment runs from about 70/day to about 1500/day.
A falang apartment say 300/day to say 5000/day.

OK my figures are very  rough but we are still very, very short of the 7000 Baht/person/day.    


RR.

[mister_smith]

(Jake_Sully @ Aug. 01 2010,13:12) Watch your passports gentlemen. They're easily worth $20,000.00 in the wrong hands and people are willing to pay.

$20,000 eh? Tell you what then, You find me someone who'll buy my PP for $20,000 and I'll cut you in for a 10% commission.

You wouldn't even get 500 Euros in Amsterdam.

[Jake_Sully]

The reason the passport isn't much in Amsterdam is because well, its Amsterdam. People from South East Asia are trying to pay big bucks to come to the west. Also given the recent high tech upgrades to the US passport as explained above, it maybe hard to masquerade as an American now considering they can check the passport with the photo they have on file. But say a Canadian or Mexican Passport or a Danish one, if you try to sell it in a 3rd world country to someone who is willing to pay, you might have better luck. I would suggest try selling it in Manila or New Delhi or Bangkok, you'll have buyers for more than 500 euro's.

The figure was told to me by my family who reside in Thailand and I took em at their word. Honestly though I believe them, since I've talked to a few people who came to the US and they say they've paid 1.5 mil baht to be smuggled into the US sometimes from Canada, sometimes from Mexico. They tend to stay here and work for 7-15 years illegally if they can't find a green card and work the money off while living frugally and sending money home. How they do it exactly is something I haven't got an idea. I'm guessing money earned off the books so not taxable.