Summary
The future involvement of past red shirt leaders are being questioned as they are being acquitted and assigned positions to assist new ministers. Thaksin has also announced his potential return to Thailand. Economics are being heavily debated in several sectors including gas, energy, stock, corporate and standard of living. Losses this week due to global downturn have affected Thailand’s growth despite upward predications and government plans to increase spending for the future. Border problems with Cambodia have been “resolved” as the new government steps in and officials discuss their future relationship. Human rights abuses and new security measures pertain to important security concerns.
Politics
National police chief Wichean Potephosree will step down to make way for deputy police chief Pol Gen Priewpan Damapong, brother of former PM Thaksin Shinawatra’s ex-wife Potjaman na Pombejra, to take the top police post. Prime Minister Yingluck Shinawatra confirmed though that Police Capt Chalerm will have the final say on the police chief position. Wichean came under pressure this week after the former massage parlor tycoon Chuvit Kamolvisit, who won 4 seats with his Rak Prathet Party in the July 3 elections, presented a video of an illegal casino. The chief of the Office of Public Sector Anti-Corruption Commission (PACC) has confirmed Chuvit’s claim that senior police officers owned and oversaw the casino. (Bangkok Post) (Thailand Business News)
Red-shirt leaders were assigned government jobs as assistants, advisers, secretaries and assistant secretaries to several ministers, seen as a move to appease the red shirt movement as none of them were given a ministerial post. For example, Gen. Panlop Pinmanee was appointed as advisor to the prime minister. Political scientist and Director of the Policy Watch Centre of Sripatum University Somchai Srisutthiyakorn argues that this move would do more harm than good to the Pheu Thai Party because “… the appointment of red shirt leaders to political positions is certainly not based on proper performance and qualifications, but rather on a patronage system.” Government spokeswoman Thitima Chaisaeng meanwhile commented on the benefits as this would mean that “from now on, there is no need to worry that these people will take to the streets in protest”. Further claiming that while it will serve as a link to the grassroots therefore being able to respond better to the people’s needs. (Bangkok Post) (The Nation)
In related news, four red shirt protesters were sentenced to 34 years in jail for their involvement in last year’s riots. All in all, 21 red shirt members were trialed with nine of them being acquitted due to a lack of evidence while the rest were sentenced to serve between 8 months and 2 years. (AFP) Former PM Abhisit Vejjajiva testified in front of a senate panel in relation to last year’s violence which cost 92 lives. Abhisit denied giving orders to shoot and stated that officers did not use excessive force but rather acted in self-defense as gunman were among the red shirt protesters. (Bangkok Post) While recently visiting Japan, ousted PM Thaksin Shinawatra seemed to have a change of heart, declaring that he would like to come back to Thailand to lead the country if the people would want him to, a move he previously denied.
In a move to lower the costs of living the Thai government this week suspended the collection of the excise tax on gasoline and diesel which lead to declining fuel prices for regular 91and 95 octane petrol by between 7 and 8 baht a liter. This in turn reduced the incentives for motorists to use alternative fuels like gasohol, as price difference between them fell from 7.4 baht to 1.4 baht per liter. Authorities stated the price cuts would benefit farmers, the transport sector, motorcycle drivers and owners of older cars unable to use ethanol-based fuels in their engines. Concurrently ideas about floating the liquefied petroleum gas price are occuring, which have been fixed for over two decades. To alleviate the impact of this policy the government would issue credit cards to low income earners. (Bangkok Post)
As further moves to raise the living standard of people PM Yingluck plans to raise the minimum wage to 300 THB next year, although, as The Nation reports, it will initially only be implemented in 7 provinces (Bangkok, Samut Prakan, Samut Sakhon, Pathum Thani, Nakhon Pathom, Nonthaburi and Phuket), with 3 million workers expected to be profiting. Further, nearly 350,000 government employees with a bachelor degree or higher will see their pay rise to 15,000 THB while those without a degree earning less than 9,000 THB will see their pay raised to 9,000 THB. With an additional cut in the corporate tax rate the government argues that growth rates would be further increased by 2.5%, in addition to the 4.2% projected by the Thai central bank previously. (The Nation) (The Wall Street Journal)
Economic
International losses continue to affect the economic status of Thailand and Asia. Significant events such as reports of decreases in American housing prices, the lowering of the CLSA Asia-Pacific Markets target benchmark index by 8.3 percent, the drop of gold and the drop in stocks of several Thai-International companies significantly affected the Thai economy. Although foreign investors retain 30% of trading locally, their activities widely influence market movements. The Thai stock index, along with several other Asian currencies, fell this week 1% to 1,046.43, the lowest in more than two weeks. Foreign outflow retracted 3.52 billion baht ($118 million), on top of the previously lost $522 million. Thai banks also fell, including Bangkok Bank which reduced 2.3 percent, despite the previous expectations that rising interest rates would be halted. The Bank of Thailand raised its policy rate 3.50 percent. The raise in the policy rate was implemented in hopes that export diversification to different markets, domestic consumption and investment and raised optimism would reduce risk in the Thai economy and resist the damage arising overseas. Despite the historic jump of exports in July, Thailand needs to closely monitor its national standing. (The Nation) (Reuters) (Bloomberg)
The slow global economy and flooding in the country have been cited as fundamental factors in the recent limiting of Thai farm economy growth. Projections have been reduced from 4% to 3%. The global forecast was adjusted from 3.6% – 4% to 3.8% – 4.2%.The increase in competition coupled with the decreases in prices and demand are forecasted to affect several crops such as rubber and non-staple foods. Entitled “the domino effect”, even nations like China (a major importer of Thai goods) will suffer if the United States reduces its intake. Flooding also has a critical impact as 14 major rice producing provinces in Central and Lower North Thailand such as Ang Thong, Ayutthaya, Phichit, Chai Nat and Nakhon Sawan are being destroyed. Floods have affected 2.4 million rai of farmland which will strongly reduce farm production. (Bangkok Post) (The Nation)
Despite forecasted problems, the Thai government has affirmed its plans to continue the promised policy to pay farmers 15,000 baht a tonne for an un-milled paddy or roughly $830 a tonne for export. This is compared to the current price of $615 a tonne, making the price over 50% more than the market rate. Experts are skeptical of the practically due to available funding and the unsustainable level of rice reserves which will potentially reach 6m or 7m tonnes by the end of next year, as opposed to 2m tones. Sources claim the Thai government may potentially lose more in the long term (both economically and politically) if they are forced to sell at a loss. (Financial Times) However, Deputy Prime Minister and Commerce Minister Kittirat Na Ranong claimed an expected boost by 2012 with an economic growth by 2.5 percentage points. Sources have cited that if the global economy continues to drop, the budget deficit may reach over the estimated 350 billion baht ($11.7 billion) for the next fiscal year starting in October. (Reuters)
Security
Thailand’s relationship and policies towards Cambodia are being adjusted as the PTP government begins to take action. The Thai-Cambodian Regional Border Committee (RBC) met this week to renew promises of cooperation and halt disagreement concerning the border. The meeting focused on peace keeping methods between the police and military to reduce the tensions. Led by Lt-Gen Thawatchai Samutsakhon, Second Region Army Area commander and Cambodia’s Fourth Army commander Lt-Gen Chea Mon, both officials have agreed to increase their priorities relating to security at the border. This includes: withdrawal, drug trafficking, citizen’s peace and development, public health, agriculture, tourism, education and efforts to strengthen bilateral ties. A follow up Thai-Cambodian General Border Committee (GBC) meeting will be held on September 8th to discuss further details. A senior Thai military officer was quoted stating “Be assured that the overall (RBC) talk was positive and from now on (I) believe that there would be no further clashes as a problem no longer exists.” (Pattaya Mail) (MCOT)
In line with the renewal of the Thai-Cambodia relationship, energy planners are reviewing plans in regards to the “oil-rich overlapping claims area (OCA)” between the two countries as a potential solution to the heavily debated future of energy sources in Thailand. The OCA is a 27,000-square-metre offshore area with an estimated 11 trillion cubic feet of natural gas and other sources such as condensate and oil. With the increase in consumption and expectations that gas reserves are going to be depleted over the next 15-18 years, the Ministry of Energy is planning to utilize new petroleum reserves. Under Thaksin’s previous administration, Cambodia and Thailand agreed to share over two-thirds of the southern claims area and both sides have proposed varying solutions on how to equally split the reserves.
The need to diverse fuels is being discussed on multiple platforms. Gas now makes up 72% of the fuel for the country’s total electricity generation. Nuclear energy is being re-visited as irresolute conversation remains pertaining to the Thailand’s first nuclear power plant. The builders, Korea Electricity Power Corporation (Kepco), have asked for preparation and long term concentrated efforts among stakeholders to insure security and safety. The plant has been estimated to open in 2023. Environmental activists have called attention to the need to bring in varying renewable energy sources and to better manage the demand. (Bangkok Post)
The South of Thailand experienced drastic amounts of violence this week. In Yala, an estimated 30 gunmen attacked a former village chief’s home, two died, including the chief’s son and grandson, a four-year-old. 10 police and villagers were wounded. A defense volunteer was shot to death in a drive-by shooting. A bomb explosion wounded four garbage collectors and another roadside bomb in Narathiwat killed five defense volunteers, who lured into a trap to rush toward the area, and wounded several others. (Bangkok Post)
Human rights scrutiny is being implemented after “Black Case No. 2161/2552”, prosecuted by Police Major General Chakthip Chaijinda, was held this week due to a past human rights victim speaking out against those who tortured him. Mr. Suderueman Malae, the victim, was sentenced to two years in prison for having spoken out against his alleged torturers. Violating article 13 under the agreed to “Convention against Torture and Other Cruel, Inhuman or Degrading Treatment of Punishment (CAT)”, this case has been recognized as a human rights abuse; legally supporting the denial of justice and idly allowing further violence to be committed. Human rights organizations believe Mr. Suderueman is being convicted in an effort to create intimidation and reveal the consequence of making a complaint against authorities. (Asian Legal Resource Centre)
Experts continue to review the benefits of investing in Myanmar as it replaces Thailand as China’s number one business partner. Thai Board of Investment (BoI) International Affairs Bureau has stated that Thai investors should look to expand in Burma in addition to India and China. As Burma plans to reduce its agricultural-oriented focus in favor of industry, The BoI has recommend Thailand act as an export centre. Thailand would produce Myanmar’s raw goods while Myanmar would act as a packaging center to reduce costs. (The Nation)
In preparation for the ASEAN Economic Community and the opening up of the labor market in 2015, Thailand will introduce a fingerprint screening system next year. Pol Maj Gen Visanu Prasarttong-osoth, deputy immigration chief, commented: “When people are able to enter the country more easily, we could end up being contaminated with more criminals.” The new technology will monitor the arrival of passengers at Suvarnabhumi Airport and according to the Pol Maj help reduce crowdedness at immigration checkpoints and reduce the number of immigration officers. Additionally the Advanced Passenger Processing (APP) will be adopted. Airlines will have to submit names of passengers to the immigration bureau to check in advance, a policy delayed for eight years because of privacy concerns. (Bangkok Post)
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