Summary
In politics, the main topic for the past fortnight has been the Amnesty Bill, set to be deliberated on August 7 by the Parliament. Although seen by the Pheu Thai Party as the only way for Thailand to reach reconciliation between opposing political groups, the Democrat party has resisted this idea strongly and the National Security Council is expecting anti-government rallies to be held in Bangkok in the coming weekend.
In economy, political unrest continues to shake the market while the Government moves forward on infrastructure investment and tax reform. In the agricultural sector, allegations about toxic substances in Thai rice have been in the spotlight over the past fortnight. The situation for Thai farmers has been tough during this year since the sector is burdened by the pecuniary uncompetitiveness of Thai exports as well as droughts in part of the country and diseases affecting shrimp farms. In security, the 40-day “Ramadan Peace Initiative” in the three Southern Border Provinces has brought down casualties to its lowest point since January 2013. Meanwhile, the Cabinet has approved an increase in the budget for the armed forces, aimed at investments in for example navy frigates. The past fortnight also saw a significant oil spill outside of popular beach destination Koh Samet as well as floods in Western Thailand.
Politics
A meeting among the Pheu Thai political enforcers (whips) has set a priority of bills to be discussed within the month. It was decided that the Amnesty Bill be deliberated first, followed by the 2014 budget bill and the 2.2 trillion baht infrastructure loan bill. The Amnesty bill, set to pardon participants in protests who have committed criminal acts since the September 2006 coup, has been hotly debated. Lawmakers argue that national reconciliation can only be achieved if the terms of the amnesty bill are clearly defined yet the five submitted bills lack clear definitions as to which crimes can or cannot be pardoned. It has been confirmed by that the Amnesty Bill proposed by the Pheu Thai MP, Worachai Hema, will be considered for next week’s session. This bill has met opposition from several anti-government groups who believe that it would unfairly favour red-shirt protesters arrested on charges such as theft, arson, and murder. The Pheu Thai Party leader, Mr. Churapong Ruangsuwan, nevertheless defended the bill by saying that an amnesty is the first step to ensure equality and human rights that can mend Thailand’s divided society. Former Prime Minister Thaksin Shinawatra is among the main topics of contention as it is believed that an amnesty bill would pave the way for his return to Thailand. (Matichon, Bangkok Post, The Nation)
The National Security Council is expecting anti-government groups to rally in large numbers to oppose the bill during the coming weekend. In a special cabinet meeting yesterday, it was decided that the Internal Security Act (ISA) will be imposed in three districts in Bangkok (Dusit, PhraNakorn and Pomprat) from August 1-10 as a preventive measure for escalated violence. The gives power to the Internal Security Operation Command to ban the public from leaving their homes, traveling to particular places, and use of certain transportations or routes in order to maintain internal security. Since the law was passed in 2008, it has been in effect seven times, several of those during the protests in 2009 and 2010. (Bangkok Post).
Police have also conducted anti-riot drills for two scenarios, in the case where the parliament or the government house could be taken over. The police have said that they will adhere to international standards when engaging with protesters. Concrete barriers have also been set up at the entrances of the government house in anticipation of the Pitak Siam group rally expected on Sunday. Red-shirt groups have set up camp in front of the parliament building in order to “protect the lawmakers from anti-government groups”. The resumed parliamentary session may further worsen the political conflict between the government and its rivals. At least one anti-government group has announced that they intend to go ahead with their plan to rally this Sunday, despite the implementation of the ISA. (The Nation)
Economy
Renewed unrest in Thailand’s capital and fears of large-scale protests against the Amnesty Bill have affected the Stock Exchange of Thailand (SET) negatively over the past fortnight. The SET has fallen 12% over the past three months and analysts emphasize the importance of political stability to support the continued growth of the Thai economy. The Internal Security Act (ISA) that was put in place in three Bangkok districts may also have affected investor confidence negatively as it could have pushed investors to “wait and see” before investing, according to Mr Areepong Phucha-um, the permanent secretary for finance. The senior director of the Bank of Thailand (BoT) however stated that it was still too early to assess the impact on the economy of the ISA and that the bank was monitoring the situation closely. (Bangkok Post, The Nation)
The much discussed 2 trillion baht state loan, earmarked for infrastructure investment, seems to go ahead as planned despite Democrat Party concerns that it would be unconstitutional. Deputy Prime Minister and Finance Minister, Mr. Kittiratt Na-Ranong, spoke at a seminar devoted to the loan on July 30. He there declared that the government had been in close contact with the BoT to ensure that the loan would not break the target for public debt in relation to GDP. Another possible change to state revenue includes a draft bill, approved by the Cabinet on July 30, designed to revise the income tax rates. The goal of the bill is to achieve a more equal tax distribution. According to the draft, lower-income groups (0-300,000 Bt) would pay only 5 per cent tax instead of the earlier 10 per cent rate that was imposed for people earning between 100,000 and 300,000 Bt. Although the bill would reduce state revenue, the increase in net personal income is expected to boost household consumption and thus fuel the market economy. (Bangkok Post, The Nation)
On another topic, food product exports are a vital part of Thailand’s economy and recent doubts over the quality of Thai rice have shaken the industry. Earlier this year, reports of worryingly high levels of lead and pesticides in several rice brands led the Thai Rice Packers Association to take unconventional measures to restore consumer confidence. They are now launching a campaign in which 20 million baht will be given as compensation if any consumer lost their life due to toxic substances in Thai rice to prove their confidence in the product. The association has also allocated funds to perform monthly randomized tests of rice quality. The current controversy arose when a fumigant substance was found in packaged rice. The toxic substance methyl bromide is above all known to be harmful to the ozone layer but humans who are directly exposed to it may suffer respiratory disease and central nervous system damage. Thailand has vowed to stop using the substance by the end of next year. Other agricultural industries are also encountering hard times; the eruption of a shrimp disease has brought down national agricultural GDP growth forecasts by 1-2 percentage points while droughts in many areas of Thailand have adversely affected certain crops. (The Nation, US Environmental Protection Agency)
Security
The 40-day ceasefire agreement between the Thai government and the Barisan Revolusi Nasional (BRN) has been amended. The so called “Ramadan Peace Initiative” was intended to be a “violence free” period extending over the Muslim fasting month of Ramadan. The initiative has had a notable effect on violence in Thailand’s south as casualties have been lower over the past month than in the past six months. In the latest amendment, BRN has agreed to the exclusion of Sadao district from the ceasefire pact. BRN filed a complaint to the Malaysian government mediator claiming that the Thai government troops had failed to comply with the ceasefire agreements, thus prompting BRN to launch counterattacks. This was rebuked by Thai Government authorities. The 40-day “violence free” period will expire on August 18. (BBC, Bangkok Post, The Nation)
Despite the relatively peaceful period, there have been a few significant attacks in the three Southern Border Provinces over the past fortnight. In Pattani, a local official was killed and a village headman wounded in two separate shootings in Muang and Yarang districts. A road side bomb detonated in Pattani’s Muang district slightly injuring two soldiers providing security for teachers in the area. In Chanae district, Narathiwat, two teachers were killed and another was injured in a bomb explosion that also wounded two policemen. This attack led schools to suspend classes for three days due to security concerns. In Yala, a teacher at an Islamic school was shot and killed in Betong district while a village security guard was ambushed in Bannang Sata district. In the same district, a bomb explosion inside the Ban Tao Pun school grounds injured a defense volunteer. The bomb was detonated remotely when the volunteer approached it. All schoolchildren were in class at the time of the explosion. (Bangkok Post) National security news include the approval by the cabinet of a 16.3 billion baht budget for the armed forces for the next fiscal year. The budget allocation will be used for various projects that will enhance national defense. The navy received support for procuring three new frigates while the 718 million baht allocation for the air force will be spent on fleet repair and renovation. The army’s 600 million baht budget will be used for a Thai-Israeli joint project aimed at increasing the production of black powder used in grenade launchers. (Bangkok Post)
Moving on to a man-made disaster, on July 29 the usually picturesque beach destination Koh Samet was gravely affected by an oil spill, leading authorities to declare a maritime disaster area. Western Thailand has also been affected by floods and landslide warnings have been issued in some areas. In Kanchanaburi, the famous Mon Bridge, the longest wooden bridge in Thailand, was damaged by flood currents and floating weeds. Heavy to very heavy rain is expected to fall in North and Northeast Thailand. Tropical storm “Jebi” is expected to hit Thailand on August 2 and the provinces of Loei, Nong Khai, Bueng Kan, Udon Thani, Nong Bua Lam Phu, Sakon Nakhon, Nakhon Phanom, Mukdahan, Chiang Rai, Phayao, Nan, Phrae, Uttaradit and Phetchaburi are advised to take caution. (The Nation, Thai Meteorological Department)
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