Monday, May 19, 2014

Thailand: Update--Economic Future Dismal as Political Future Uncertain, More Unrest Protected

According to Reuters, Thailand's acting prime minister Niwatthamrong Boonsongphaisan on Monday (May 19) ruled out resigning as a way out of a protracted political crisis that is negatively  impacting on economic growth, as anti-government protesters stepped up pressure to remove him and install a new administration.

Thailand is economically impotent following the dismissal of Prime Minister Yingluck Shinawatra, 46, and nine of her ministers on May 7, after the Constitutional Court found them guilty of abuse of power.

Six months of turmoil that has included violent protests and a disrupted general election is dragging down Southeast Asia's second biggest economy, which shrank 2.1% in the first quarter of the year.

Commerce Minister Niwatthamrong Boonsongphaisan replaced Yingluck as caretaker prime minister, but the anti-government protesters say he has no legal standing and they want a "neutral" government to push through reforms.

"The current cabinet is legal in every must remain until a new cabinet of ministers is elected. We cannot install another PM while we have an acting one in place," Niwatthamrong said in statement following the meeting.

Thailand has not had a functioning lower house of Parliament since Yingluck dissolved Parliament in December 2013.

Bangkok is the scene of a tense stand-off between government supporters loyal to Yingluck and her brother, ousted former Prime Minister Thaksin Shinawatra, 64, and opposition demonstrators drawn from Bangkok's middle class and royalist establishment.

COMMENT: The upper house Senate, the country's only remaining legislative body, says it could select an interim prime minister but it wants the caretaker government to step down first.

That has incensed protest leader Suthep Thaugsuban, who wants the caretaker government removed immediately.

"From Monday, we will chase the remnants of the Thaksin regime out. Ministers, resign! You are stunting Thailand's progress," said Suthep, who had promised to surrender on May 27 if this final push does not succeed.

It noted that public investment was 19.3% lower than a year before as the caretaker government has no authority to begin new projects, while private sector investment fell 7.3% as business confidence slumped.

Thaksin was ousted by the army in a 2006 coup and convicted of abuse of power in 2008. He now lives in self-imposed exile. His enemies accuse him of being a corrupt crony capitalist who controls governance through "money politics."

Fuelling their anger, Monday marked the fourth anniversary of a deadly crackdown on red shirt protesters by the Democrat-led government in which Suthep was a deputy prime minister.

The political divisions are tainting virtually every aspect of society.