Summary
The list of cabinet members has been released and finalized with varying but more or less “safe” choices, leaving out the controversial red shirt leaders. Questions have arisen regarding Yingluck’s inexperience as a result of some of the ministry decisions and scorn has been received for Thaksin. The world financial position is suffering as the United States and Europe economies are dropping. Despite having steady growth and stable stocks, large investments in Thailand are endangered. Experts have predicted potential further investment in emerging economies as developed nations plunge. Violence in the South is more and more prevalent as experts claim the government is losing control and a chance to rectify the insurgency. The new administration will be meeting with Cambodian officials and human trafficking and refugees from North Korea in Thailand are analyzed.
Politics
The new ministerial cabinet under Prime Minister Yingluck Shinawatra received royal endorsement on Wednesday, August 10. His Majesty the King reminded the cabinet members that there is significant confusion in today’s international social and political arena and that he wants Thailand to be a peaceful country with prosperity and stability in all parts of the country. (The Nation)
Of the 36 new cabinet members, foreign minister Surapong Towijakchaikul instantly received the most attention in the media. Critics have argued that considering the long list of candidates for the position, including former diplomats, appointing someone without international relations experience was a poor decision. This is emphasized by Surapong himself recently stating that he was not interested in foreign affairs with a follow up statement on Tuesday after he was informed of his appointment that he admits “I am new to this field”. (The Nation) Political Observers are therefore speculating that Surapong, a distant relative of Thaksin Shinawatra, was appointed because of his ties to Thaksin.
Regarding the cabinet list the Bangkok Post reports that a number of preferred individuals for ministerial posts, like executive chairman of Siam Commercial Bank Vichit Surapongchai, turned the offer down because of the conditions and agenda set by Thaksin. Thammasat University political scientist Somjai Phagaphasvivat argues therefore that Thaksin then “…went for those who will do what he wants them to.” (Bangkok Post)
The red shirt movement, decisive for Pheu Thai’s election win, were left out of the new cabinet and did not receive a ministerial portfolio. Somjai Phagaphasvivat commented that arrangements were made with MPs affiliated with the red shirts to compensate for missing out on cabinet seats. Regarding the tense relationship between Pheu Thai and the military, new defense minister General Yuthasak Sasiprapa confirmed that there will be no reshuffle in the armed forces and no one will be transferred. Additionally he confirmed that Thaksin asked him to work towards establishing better relations between the party and the army and added that he does not expect another coup. (AFP)
Meanwhile, Abhisit Vejjajiva was re-elected as the leader of the Democrat Party on Saturday morning despite losing heavily in the recent elections, with 96.03 percent of Democrat Party members voting for Abhisit. There were no opposing candidates for the position.
Economic
The monumental fall of the US and European currencies and rise of debt have set precedence in international economies, including Thailand’s. Despite having a strong and steady Stock Exchange of Thailand (SET) following the elections, the stability of domestic investment is significantly at risk. As a result of US debt, foreign buying rose 14.1% this month up to 34.7 billion baht. However, without security and significant, rapid money loss, these investors will be selling off. Thai stocks closed lower this week in volatile trade and SET index dropped 30 points until curbed. As of August 11, Thai stocks opened down 4.78 points. In comparison, Asian countries stocks suffered greatly: Tokyo fell 2.18%, Seoul dropped 3.82% and Shanghai dropped 3.79%.
In opposition, world gold prices ascended to a record $1,779 at the beginning of the week and local prices broke the 25,000-baht barrier when investors sought protect their cash assets. SET president Charamporn Jotikasthira spoke out to investors explaining that the international economic impact on Thai companies would vary, claiming that impact will likely not show at the moment and recent trends have showed only growth. Risk and short term volatility will continue to be measured highly in order to help avoid an international domino effect.
Deputy Governor for the Bank of Thailand (BoT) has predicted that developed nations will shift their assets to emerging economies at the moment to assert risk aversion and in the long term, to invest in greater potential for overall growth. Asian economies have been cited to be in a more stable fiscal position as the developed states are struggling to recover. Currencies like the baht will become more volatile.
Upheaval surrounding the Finance Ministry’s decision not to collect tax from Thaksin’s children after the sale of Shin Corp shares to Singapore’s Temasek Holdings was renewed this week. The Central Tax Court originally ruled that Thaksin was in control of the shares, not his children, however when Thaksin’s assets were seized following his trial, his two children were found to be the only surrogate share holders. Former finance minister Korn Chatikavanij is calling upon the revenue Department to collect the tax.
The new finance minister Thirachai Phuvanatnaranubala, previously employed at Securities and Exchange Commission (SEC) and the Bank of Thailand has gained national support in taking on the finance ministry but experts reservations relate to his lack of experience in transforming policy into action. Monetary and fiscal policy need to be coordinated and seen from both a macro and micro stance. There is also doubt expressed about the ministers chosen for science and technology and natural resources / environment, as experts claim the economic environment (e.g. agriculture) needs to be a large focus given the struggling international economy. These ministers face the significant task of choosing the right decisions based on the promises made by the PTP campaign for the rising cost of living and minimum wage and keeping a grip on government spending (Wall Street Journal) (Bangkok Post).
Security
Ahbisit’s final speech this week clearly outlined the upcoming general considerations for Thailand’s security, highlighting the importance of the international community’s renewed support and confidence in Thailand, emphasizing the need for the new government to participate in building global relationships. The former PM touched upon the dispute with Cambodia, stating that he hoped sovereignty and Thailand national interests continued to be protected. The South of Thailand was also highlighted, as Ahbisit claimed despite efforts, violence persists and that the future government needs to continue looking for solutions and implementing policies that will support long term peace. Finally and most importantly, unity as a nation was named as imperative to future security and “leaving political conflicts to be dealt with through the parliamentary process” (The Nation).
Regarding the Thai-Cambodian border conflict General Yuthasak argued for a face-to-face meeting between Yingluck and her Cambodian counterpart PM Hun Sen as a first step towards easing the tensions. This was followed by a meeting between Yuthasak and Cambodian defense minister Gen Tea Banh to discuss the withdrawal of troops.
Violence in the South remains the unchanged if not stronger. Three different acts of violence on August 4th killed four people. In Pattani, a Muslim religious teacher was shot to death, a married couple in Sai Buri district was also gunned down and a former village defense volunteer was killed from shootings in Yala’s Raman district. A bomb explosion targeted and wounded two policemen in the Muang district of Yala and Yusoh Weseechi, a village headman in Pattani was ambushed and killed.
Experts have contended this week that if the insurgency surpasses ten years, the government would be hard-pressed to deny being overpowered by the Barisan Nasional Resolusi-Coordinate (BRN-Coordinate), the influence behind the guerrilla war. Chaiyong Maneerungsakul, a member of the Administration and Development Advisory Council of the Southern Border Provinces Administration Centre has predicted BRN-Coordinate’s will continue to terrorize the South until it has a dominant control over the 50% who still do not favor one side or the other. Cells are continuing to expand and the BRN has now appointed its own leadership roles in villages and districts. Their influence stems from the secrecy of the organization and funding from contraband and drug smuggling. Some experts claim the insurgents have no interest in “a solution” so long as they are able to continue profiting.
In separate violence news, on August 6th, two soldiers from the Suranaree Force bomb disposal units were wounded in a landmine explosion near the Thai-Cambodian border (Bangkok Post).
Trafficking has been feature as an imperatively ignored issue in Thailand and ASEAN. A UN Rapporteur, (those sent by the UN to “examine, monitor, advise and publicly report”) Joy Ngozi Ezeilo, has been sent to Thailand to examine human trafficking. Predictions have been forecasted that lack of progress and significant breaks in international treaties and policies will be found, specifically within areas of fishing industry. This includes both prostitution and illegal workers. Analysts have called upon media, civil society, sector, foreign consumers and the international community to put forth a joint effort to combat “modern day slavery” not only to support human rights but for the consequences Thailand as a State will suffer (The Nation).
North Korea’s security has also been found as increasingly relevant to Thailand as thousands are fleeing and searching for refugee status to escape deep poverty and starvation. In 2010, 2,500 North Koreans were reported as asylum seekers. Thailand has been found to be significantly easier than Mongolia or Vietnam at border crossings where some security have sent NK citizen’s back (IRIN News).
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