Summary
In politics, Prime Minister Yingluck Shinawatra presided over the first meeting of the political reform forum and set a seven-point framework for future meetings. The Pheu Thai government meanwhile attempts to reform the Senate to replace the selected with publicly elected senators, which the opposition fears could result in a Senate consisting of politicians family members. The leadership of the yellow-shirt People’s Alliance for Democracy (PAD) resigns, while the Democrat Party resorts to street politics.
Thailand’s economy slumped into recession over the past fortnight as the figures for the second quarter showed a decrease in GDP of 0.3 %. This mild recession took many analysts by surprise as Thai exports were expected to pick up sufficient speed to produce at least some growth. The disappointing figures led to some discussion over the Bank of Thailand’s interest rates as well as a drop in the baht’s value to its lowest level in one year.
In security, the Thai government attempts to restart peace talks with Barisan Revolusi Nasional (BRN) despite disagreement of factions within BRN on the peace process. Women activists, on the other hand, call for inclusion in the peace talks noting that women’s voices are often overlooked. Investigations on the 300 visa labels that have gone missing from the Thai Embassy in Kuala Lumpur continue and reports show that 250 of them have already been used.
Politics
Prime Minister Yingluck Shinawatra presided over the first meeting of the political reform forum, held at the Santi Maitri Hall of Government House on 25 August. The meeting was attended by 57 leading figures of Thailand, while Democrat Party members and the People’s Alliance for Democracy (PAD) were notably absent. Speeches by former Prime Minister Chavalit Yongchaiyudh and the UDD’s chairwoman Tida Tawornseth highlighted the need forthe people’s participation in the forum but failed to propose ways to include the people’s voice. At the end of the meeting, PM Yingluck set a seven-point framework for the assembly, consisting of: Ensuring the strength and stability of constitutional monarchy, reducing and solving social inequalities and poverty, having working mechanisms that are transparent and examinable in line with principles of good governance, creating justice and equality to ensure people’s fundamental rights in line with the rule of law, building democracy through public participation from all sectors and respecting the majority while listening to the minority, creating mutual trust and forgiveness and an environment of trust and prioritising the interests of the public and rightness. It was furthermore agreed upon to set up three working panels to cover these issues, which will be coordinated by Banharn Silpa-archa.
On another front, the government was pushing to reform the Senate, wishing to replace the selected senators with elected ones. The Pheu Thai government considers the current constitution with the selected senators as a by-product of the 2006 coup. Debate on the new law had led to a brawl in Parliament after Parliament Speaker Somsak Kiatsuranont wanted to limit the debate by the opposition party to two members. Opposition leaders and political analysts fear that a publicly elected Senate will ultimately lead to it consisting of politicians’ relatives.(Bangkok Post) (The Nation)
“I believe in the parliamentary system”, Democrat Party elder statesman Chuan Leekpai once said, and this was the party’s guiding principle until last week when the party decided to resort to street politics to fight legislative efforts by the Pheu Thai government. The Democrat Party considers the amnesty law as an attempt to bring back Thaksin Shinawatra a free man and the political reform forum as a way to divert public attention away from the parliamentary discussion. At the rally on 23 August, Abhisit Vejjajiva’s speech was markedly more aggressive while the crowd regularly called for PM Yingluck’s ouster with a vulgar chant. A veteran lawmaker of the party, Alongkorn Ponlaboot, disagreed with the party’s change of strategy and called it “destructive democracy”, which will result in “indefinite divisions.”
Another former opposition group, the yellow-shirt People’s Alliance for Democracy (PAD), on the other hand called it quits, for now, with the leadership resigning on Friday, 23 August. The move came days after the movement asked Democrat Party members to resign from parliament and join in street protest against the government, an idea the Democrats rejected. In a statement the PAD blamed the Democratic Party for being unable to make any sacrifices by abandoning the parliamentary system. Analysts and Democrat Party leaders were both convinced though that the party would have way more to lose than gain by quitting parliament. PAD leader Sondhi Limthongkul assured though that the PAD’s suspension of political activities was a tactical retreat and a comeback would be staged “providing the fight is worth it”. (New York Times) (Bangkok Post)
Economy
Disappointing news took analysts by surprise over the past fortnight as Thailand’s economy slipped into a mild recession. Although Thailand’s economic growth had been stronger than other economies in Southeast Asia, expanding more than 6 % in 2012, a cocktail of slowed domestic consumption and weak exports led to a 1.7 % contraction in the first quarter, followed by a 0.3 % decrease in GDP over the second quarter. The still sluggish revival of global demand for Thai exports could lead to demands on the Bank of Thailand (BoT) to cut interest rates further (the last cut to 2.5% occurred in May), thus boosting domestic consumption. However, this is an unlikely solution since household debt is already high (currently at 77.51% of GDP, according to the BoT) and rising price inflation has already affected the most vulnerable parts of the population. Domestic consumption makes up around half of Thailand’s economy, and government stimulus measures have therefore had a significant impact on the economy. In the first half of 2013, the effects of stimulus packages and recovery measures after the 2011 floods have faded away while new investments, such as public infrastructure projects, that could have boosted consumption have been delayed. Following the announcement of entering recession, the central bank lowered its GDP growth forecast from the 5.1 % expected in July to a revised 4.2 %. The baht simultaneously hit a one-year low at 31.66 per dollar. Interestingly, despite meeting the formal requirement for entering a recession (two subsequent quarters of declining GDP) Thailand’s Prime Minister, Finance Minister and the Governor of the BoT all assured that the Thai economy is not in recession and that the economy remains strong. Mr Kittiratt Na-Ranong, Thailand’s Finance Minister, remarked that the weakened baht can be good news since it will help revive exports. Many analysts foresee some growth and improved export numbers for the last quarter of the year but this will most likely not prevent the Asian Development Bank (ADB) and the World Bank from lowering their growth forecasts on the Thai economy from 4.9 and 5 % respectively. Although the new forecasts have yet to be revealed, the ADB is expected to lower its forecast to between 4-4.3 %. (BBC News, Reuters, Bloomberg Businessweek, Bangkok Post, National News Bureau of Thailand)
Other news have included the challenge for small and medium-sized enterprises (SMEs) to integrate into the regional market under the ASEAN Economic Community (AEC). Six keys areas were identified during a seminar on the AEC and SMEs: the adoption of active business expansion strategies, reducing production costs or raising productivity, improving the quality of goods or services through innovation, research and development, market research and preservation of existing markets while exploring new ones and finally, seeking partners for all stages of production. Thailand’s Commerce Minister, Mr. Niwatthamrong Boonsongpaisan said that if SMEs are prepared in these key areas then they should be able to compete with others in the AEC. (The Nation)
Security
The Thai government attempted to restart the far South peace talks with the Barisan Revolusi Nasional (BRN); however, some factions within the separatist group disagree with the peace process. The peace talks have been in a deadlock as the government decided not to give in to BRN’s demands, which include the release of detained insurgent suspects and revocation of arrest warrants for those at large, and the state’s recognition of the BRN as a liberation movement and not as a separatist group. A seminar regarding the BRN and the peace process conducted in Bangkok highlighted the need for a security reform. The seminar also pointed out that while the peace dialogue is not necessarily negotiation, it is a stepping stone to building trust between insurgent groups and the government. (Bangkok Post)
Women activists also call for the inclusion of women in the south peace talks, emphasizing that they should be involved beyond charitable “feminine” activities. They argue that they should be given an opportunity to take part in dialogues about political and social issues as women’s voices are often overlooked. Shadia Marharban, trainer and women’s rights activist, mentioned donors’ reluctance to support activities that are considered political in nature. Ms. Marharban argued that it is time to empower women through teaching them about democracy, peace building and fund raising, and engaging them to participate in political discussions. Angkhana Neelapaijit, chairwoman of Justice for Peace Foundation, pointed out that women have been exploited by the people responsible for violence in the South and the authorities did not realize this soon enough. (Bangkok Post)
The Foreign Ministry and the police are conducting special investigations on the disappearance of 300 visa labels from the Thai Embassy in Kuala Lumpur, referred to as an “irregularity” caused by Malaysian staff at the Embassy. The missing labels are believed to have been sold to people on the terrorism watch lists and an immigration blacklist. Two committees are investigating the incident –the Thai Embassy in Kuala Lumpur and the Foreign Ministry. A number of foreigners have been charged with using fake documents to enter Thailand after they were arrested at the Suvarnabhumi airport. They were detained at the Immigration Bureau in Bangkok. The Foreign Ministry reported that 250 of the missing visa labels have already been used and visa holders of 105 of them have already left Thailand. The immigration police are on a lookout for a Thai woman identified as “Mama”, a major visa broker in Thailand suspected of selling the missing visa labels. In response to this visa-sticker scam, Foreign Minister Surapong Towichukchaikul suggested the introduction of the photo visa where photo of the passport holder will appear on the visa. (Bangkok Post, The Nation)
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