By Daniel Gallucci
Half a world away from snowy Moscow, Russia’s deepening economic crisis is reverberating upon the palm-fringed beaches and castaway islands of Thailand. The droves of holidaymakers from Russian cities visiting Thai resorts are dwindling, deterred not so much by the southeast Asian nation’s military coup earlier this year as by the rout of the rouble.
As the chart below shows, Russians seeking a warm refuge from the prolonged winter of home were relatively unfazed in early 2014 by the mounting political tensions in Thailand that led to the May military coup. Read more
By Daniel Gallucci in Bangkok
An expectant hush fell over about seven hundred foreign and Thai businessmen as they awaited the keynote speaker at an event in Bangkok this week. Army chief-turned-prime minister Prayuth Chan-ocha, leader of the May coup, was moments away from making his first address to the foreign business community.
Then, as a phalanx of security men signalled the general’s arrival, the venue exploded into song. Blaring from the loud speakers came the ponderous strains of “Returning Happiness to Thailand”, a song he composed just after the coup. Read more
By Daniel Gallucci, Asean Confidential
How badly has Thailand’s economy been affected by a decade of political turmoil? A projection of what GDP growth might have been in the absence of messy politics indicates that at the macroeconomic level, Thailand has not been nearly as able to shrug off external shocks as the oft-quoted moniker “Teflon Thailand” might suggest.
Between the first quarter of 2001, when former premier Thaksin Shinawatra and his Thai Rak Thai party won their first election, and the fourth quarter of 2005, just before significant protests against Thaksin began, the Thai economy expanded by 31.9 per cent in total, equal to an average growth rate of 1.5 per cent quarter on quarter and 6.0 per cent year on year. In the eight and a half years since, the economy has grown by just 21.1 per cent in total, at an average rate of 0.6 quarter on quarter and 2.3 per cent year on year. Read more
By Dan Gallucci, Asean Confidential
General Prayuth Chan-ocha, leader of the May 22 coup d’état that returned Thailand yet again to a state of military rule, has repeatedly emphasised the country’s need for a “return to happiness” following months of political chaos. He has even released a song about it.
The coup-makers appear to have so far accomplished this task according to some yardsticks: consumer confidence is up nationwide (see chart), and in Bangkok the streets are safer and traffic is no longer disrupted by protests. Many Thais approve both of the coup itself and the job the generals have done managing the country since. Read more
Dan Gallucci, Asean Confidential
Whatever progress toward a stable democracy Thailand has lost with the military’s ouster of the elected Puea Thai government, an economic analysis of the country’s latest coup must confront the following facts. First, the Yingluck Shinawatra administration had severely mismanaged the Thai economy even before the political crisis began. Second, the economy has been far more impacted by this turmoil than headline numbers currently reveal.
It will be difficult for any government the junta installs to do worse. Read more
Demonstrators in Bangkok blocked some polling stations in the Thai capital and continued to insist that they would ignore the results of the vote, but in spite of their protests, voting went ahead across the country. Michael Peel reports.
Demonstrators march towards the government building in Bangkok
Thailand’s prime minister, Yingluck Shinawatra, called a snap election on Monday, but failed to halt fresh mass street protests aimed at ousting her government. Read the full story on FT.com.
Another week, another barrage of criticism for Thailand’s massive rice subsidy scheme.
This time the attack on a programme that is costing the government billions of dollars a year and adding to worries about the country’s economy is delivered diplomatically, but none the less forcefully, by the International Monetary Fund. Read more
It was one of those moments that investors and analysts in Thailand have been waiting for: insight into the government’s massive Bt2,000bn ($68bn) infrastructure spending plan.
But rather than a big press conference, it came in a little-publicised lunch talk by Chadchart Sittipunt, Thailand’s transport minister, to members of the Japan-Thailand Association last Friday. Read more
Thailand’s attempt to register around 1.5m illegal migrant workers by the middle of next month is causing more problems than it might solve.
The deadline for workers to apply for permits has been extended – but with employers reluctant to apply on behalf of workers, and workers forced to jump through several expensive bureaucratic hoops, there are still 1m yet to complete their registration. Hanging over the process is the threat of deportation – and worries for business. Read more
The Thai government, known for its string of populist policies including rice and fuel subsidies, is delighting working class voters (those with a job, anyway) with the introduction of a national minimum wage, which kicked in on January 1.
The policy has already triggered fierce criticism in business circles and reports of job losses, particularly in rural provinces. Yet, some experts argue that despite short term pain, a hefty national minimum wage increase will raise both living standards and productivity. Read more
Siblings have a special way of taking a poke at each other, even long after they have flown the family nest.
And so it is with Thaksin Shinawatra, Thailand’s exiled former premier. In a public appearance on Friday he insisted, as he often does, that he isn’t running the country through his younger sister, Yingluck, the current prime minister.
“I’m not running Thailand,” he said. “My sister is running Thailand, but she may ask my advice on some issue. But not every issue. She is very capable – much better than I expected.” Ouch. Read more