absolutelyBangkok archive · Business & Economics
Originally published Dec. 6, 2009
A Royal Happy Birthday:
HM the King’s 82nd birthday on 5/12/09 would be the best ever celebration organized by the Thai government for the country’s most beloved king. The nine days “birthday party” would be indeed a warmly welcomed respite from the “political madness” that the people of Thailand have been subjected to in the last three to four years.
HM the King’s recovery from his recent illness too has brought great joy to the people, especially those who have taken him for granted for so long and were now determined to make up for it. At the back of everyone’s mind, however, has been the worry of further political conflicts once the red shirts resumed their aggressive attacks, in and outside of the parliament.
To topple the Abhisit government any time from now until 2/10 when the Supreme was expected to pass their verdict on Thaksin’s THB 76 billion frozen fund. For now anyway, the people would enjoy a public display of love, respect and gratitude for His Majesty. Long Live the King!
By Vongthip Chumpani*
In spite of all the dire predictions, PM Abhisit has managed to survive yet another tumultuous month in 11/09 and was looking forward to the review his first year’s performance on 23/12/09. Throughout 11/09 the Abhisit government could not but be distracted by the continuous flow of political incidents that Thaksin & Co. were spinning in and outside the country. The now-street-wise Abhisit was able to deal remarkably well with these tricky events.
By putting the country’s best interest before all else, PM Abhisit was able to steer the country through stormy political waters while continuing to carry out the normal duties of a premier and making trips abroad and upcountry. Although the Thai Khaem Kaeng Programs were not all successfully implemented, much have been achieved. With prices of rice, maize and tapioca climbing steadily, farmers were happy with the new agricultural price guarantee program.
New schemes were introduced in 11/09, albeit not without the usual teething problems e.g. electricity for all Thais within two years; government debts refinancing of poor debtors in the unorganized market; monthly allowance for the handicapped etc. At the rate he was going, PM Abhisit’s popularity among the “silent majority” has been inching up quietly.
Takki Shinegra of Cambodia
On 10/11/09 Thaksin flew into Pnom Penh and was received PM Hun Sen and his family, as Cambodia’s honorable advisor and international business guru. For most Thai people, however, the incident was both unthinkable and unbelievable. Strong patriotic sentiments rose suddenly, against PM Hun Sen for insulting the Thai institutions and against Thaksin & Co. for their betrayal. Encouraged by public sentiments, PM Abhisit summarily recalled the Thai ambassador to Cambodia and went on to revoke the Thai-Cambodian MOU (2543) on maritime border settlement.
The military, on both sides of the border, went on full alert as PM Hun Sen escalated his verbal attacks on PM Abhisit. On the day (14/11/009) Thaksin left Siem Reap (where some 50 Puea Thai MP’s went to pay their homage to their “dear leader and his bosom friend”), a Thai “spy” was thrown into jail for giving away Thaksin’s flight details! Thai-Cambodia diplomatic relationship sank to the bottom on the eve of Apec Meeting in Singapore.
Pacific Rim Partnership
PM Hun Sen’s “inappropriate behaviors” have resulted in an unexpected surge of support for PM Abhisit at home and abroad. The world was watching closely how PM Abhisit would manage the difficult internal situation as well as the external challenge from Thailand’s aggressive neighbor, Cambodia, when he attended the Apec Meeting and co-hosted the first Asean-U.S. Summit Meeting with President Obama on 13-15/11/09 in Singapore.
PM Abhisit conducted himself well enough and was even given a standing ovation when he addressed the Apec CEO Summit, calling for a global economic recovery that would be “well balanced, sustainable and beneficial to all.” During this regionally important meeting, President Obama went so far as to propose a full partnership of the Asia- Pacific Rim as Apec Members, U.S. and China vowed to maintain their stimulus spending, revamp the world economy, reject protectionism, and promote a huge free trade market.
The cat-and-mouse game
Once the red shirts started their series of all-out frontal attacks against the establishment and the Abhisit government in 11/09, public sentiments turned drastically against Thaksin and his red shirts. The people resented Thaksin’s high profile offensive interview in the Times On-Line, his arrogant visit to Cambodia as PM Hun Sen’s bosom friend, the threat on PM Abhisit’s life if he were to attend the Thai Chamber of Commerce annual get-together in Chiangmai on 30/11/09, a marathon rally of one million demonstrators scheduled to start on 28/11/09 etc.
This series of strategically planned incidents and events have alarmed the public at large and put the Abhisit government once again on full alert. Meanwhile, both the blue shirts and the yellow shirts seemed to have come to their senses. They rallied around the Abhisit government, kept a low profile and even gave PM Abhisit their subtle support in one form or another. How long this “truce” would last was anyone’s guess.
Out of the tunnel
In 11/09, both government and private sector seemed to agree that the economy was well on the road to recovery, albeit at a slower pace. The 3Q09 growth rate shrank to 0.8%. CPI was up 0.4%. Industrial output increased substantially and industrial capacity utilization increased to 66.3%. Manufacturer confidence climbed to its highest level in four years due to a hefty rise in export orders. In 10/09, yoy export was down by only -2.6% at USD 14.62 billion. Import yoy was -19% at USD 2.98 billion.
Trade balance, current account balance and balance of payment all remained in the black at USD 1,688 million, USD 1, 178 million and USD 140 million respectively. International reserves moved up to USD 135.3 billion. Unemployment went down to only 1.2% or 460,000, instead of 2 million as previously feared. Tourist arrivals went up 17% in 9/09 and 20% in 10/09. For the whole year however the number has been revised down to 13.7 million from 14 million.
The THB firmed to THB 33.22, in line with most regional currencies. The SET ended the month on a high note at 689. Gold continued its spectacular climb toward USD 1,200/oz. Oil prices fluctuated at USD 75 level. The Dubai World’s bubble burst and the 5% devaluation of Vietnamese currency were considered to have marginal impact on the country’s overall economic recovery.
An expensive lesson
Although the Supreme Court’s ruling to allow only 11 out of 76 industrial projects put on hold by court injunction, was a set back for the private sector, the market remained optimistic that solutions could be worked out soon enough by the special committee set up under the chairmanship of the highly respected former PM Anand Panyarachun. Because of this historical case, most people have come to realize at last that it was no longer possible to leave “the people” out of the business equations when environmental sensitive projects were being assessed and approved.
Politicians and government officials would have to do their homework more promptly and diligently to ensure that pertinent environmental rules and regulations were clear and transparent. In newly introduced PPP concept i.e. joint ventures between public and private sector too would have to encompass participation of the people in the public hearings to ensure smooth operations and sustainable business growth. Corporations and NGOs needed to learn to communicate, negotiate and cooperate more effectively for their long term mutual benefits. Like it or not, CSR has now become an integral part of the business and is no longer a matter of choice or luxury!
Happy New Year!
As we say goodbye to 2009 and prepare ourselves for 2010, it is time to take stock of our lives, our community and our country. If anything, the bitter experience and agony that we shared in the last twelve months has taught us that political stability and continuity were most vital for the country’s overall economy and good for business. Many people have therefore resolved to work together to get better MPs into parliament and in the government.
Since “voter education” has become so vital for Thailand, the private sector could no longer afford not to give their full support to “voter education” in one form or another, as part of their CSR contribution. Those brave enough to do so now, would be deeply appreciated by the public who have become fed up with greedy officials, power grabbing politicians and corrupt MPs. May 2010 bring us better MP’s and cleaner government officials so that Thailand could get the kind of government she truly deserved for a change!
* Vongthip Chumpani is an advisor to and former president of Bangkok Bank and a former advisor to the Senate Foreign Relations Committee. All views and opinions expressed herein are entirely from her own personal observations.
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