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Summary
Dissent within the United Front for Democracy (UDD) is threatening to split the group apart, as hardcore members continue to voice displeasure over the perceived direction of the current reconciliation process and compromising attitudes of the Phuea Thai-led government. Additionally, with the coming end of the five-year ban on Thai Rak Thai (TRT) executives, there is speculation of a cabinet re-shuffle, with such well known and polarizing figures like Jatuporn Prompan poised to take a ministerial position (pending the outcome of his case in Constitutional Court over not voting in last year’s general election). The Bank of Thailand (BOT) is set to receive a new chairman if Mr. Chatumongol Sonakul, the BOT’s current chairman, is not re-appointed. Observers note that his primary competitor is Dr.Virabongsa Ramangkura, the current chairman of Prime Minister Yingluck’s advisory team. Meanwhile in the South, despite a visit by the prime minister and a pledge of support and increased focus, violence continued throughout the three border provinces. Similarly, all was not well along Thailand’s other borders with Myanmar and Cambodia, as Thai troops in Mae Sot are on alert for possible combat with the Democratic Karen Buddhist Army (DKBA) and a firefight occurred with Cambodian soldiers.
Politics
Prime Minister Yingluck Shinawatra’s meeting with Privy Council president Prem Tinsulanonda remained a major focus of political conjecture this week. PM Yingluck insisted that she did not discuss politics with Gen Prem but focused on possible improvements to the southern security environment. Sources also confirmed that Ms Yingluck offered the government’s cooperation on projects initiated by Gen Prem, which he apparently politely declined with a smile. A significant wing of the United Front for Democracy against Dictatorship (UDD) continued to voice their dismay over the meeting, which they see as being submissive to the amataya clique. Core red shirt member Chinnawat Haboonpart clarified that “The red shirt people have said that reconciliation does not mean we have to kowtow or to perform rod nam dam hua for Gen Prem so that everything will just be fine and we will be swallowed by the amataya.” He even hinted at the possibility of a red-shirt split and that street protests as well as forming their own political party would be an option. Red shirt family members of those killed during the 2010 protests remain adamant to not support the government’s reconciliation plan which they see as a sellout of the grassroots movement. UDD chairwoman Tida Tawornseth therefore announced that the movement would distance itself from the reconciliation plan as the distrust towards the amataya elite remained high. Other red-shirt leaders like Petchawak Wattanapongsirikul meanwhile were supportive of the prime minister’s decision to meet with Gen Prem as it would be in the tradition of northern people to settle differences at Songkran in a peaceful manner. For most grassroots red-shirt members, the feeling that they would be singled out alone to sacrifice for reconciliation seems to become the predominant emotion though. Abac polls, meanwhile, show public support for the meeting, with almost 50% responding that the meeting would be a boost for reconciliation, while 26% opposed this notion. (Bangkok Post) (The Nation)
Prime Minister Yingluck announced that the government will design its water resources management and flood control model after the Chinese example. Yingluck stated that China has more than 20 years of experience in flood and drought management and would thus be equipped with a strongly integrated system including related laws, which the Thai government would use as a standard. The Chinese government will send its water experts to advise the National Water Resources and Flood Policy Committee (NWFPC). Concurrently, 14 Chinese companies seem to have expressed their interest in setting up a heavy industrial base in Thailand. (TheNation)
In anticipation of the upcoming rainy season Prime Minister Yingluck asked the Bangkok Metropolitan Administration (BMA) to accelerate its flood protection work along the Chao Phraya River. Cabinet secretary-general Ampon Kittiampon announced his confidence that all construction work to prevent future flooding would be finished by the end of August. (Bangkok Post)
Doubts about the functionality of the flood prevention plan were uttered by the senior architect of the Interior Ministry’s Department of Public Works and Town and Country Planning Thongchai Roachanakanan. He voiced his concern that flood management plans are set-up to cope with regular amounts of rain but will not be sufficient should there be more storms than usual or should the storm direction change. “This is what we call dynamic climate change. The current plan to prevent floods does not take this into account. And that is what we’re concerned about the most,” Thongchai concluded. Some areas suitable for water catchment belong to politicians, which could cause further problems, he added. His concern was supported by Thanawat Jarupongsakul, director of the Unit for Disaster and Land Information Studies at Chulalongkorn University, who argued that the government’s flood plan was based on the amounts of water from last year and would thus not be able to cope with more. (Pattaya Mail) (Bangkok Post) (Asia One) (The Nation)
With the five-year ban on the 111 former Thai Rak Thai executives finishing at the end of May, speculations about an upcoming cabinet reshuffle are heating up. Pheu Thai Party list MP and red shirt leader Jatuporn Prompan is one of the names frequently mentioned to receive a cabinet post. With the intention to maintain political support from the red shirts Jatuporn is tipped to become a deputy interior minister replacing Chuchart Hansawat. The Constitutional Court might thwart this plan though as it will deliver its decision on May 18 if Jatuporn loses his House seat and Pheu Thai membership due to not voting in the July 3 general election last year. Sita Tiwari is one of the 111 Thai Rak Thai executives mentioned to be included in the next cabinet reshuffle. Inside sources see him as a possible replacement for Anudith Nakornthap, currently the Information and Communication Technology Minister. Prime Minister Yingluck is, by some sources, unhappy with Anudith’s performance due to his handling of the One Tablet per Child programme. (Bangkok Post)
Economics
The new chairman of the Bank of Thailand (BOT) will be appointed after the tenure of the former chairman, Mr. Chatumongol Sonakul, ended last month. The contest comes down to two contenders which are Mr. Chatumongol Sonakul, who is nominated to be in the position again by the BOT, and Dr.Virabongsa Ramangkura, who is currently the chairman of Prime Minister Yingluck’s advisory team and the chairman of the Strategic Committee for Reconstruction and Future Development. While there is no doubt that both are qualified for the position, the selection committee should consider public’s perception over the independence of the central bank and the integrity as an independent pillar in protecting the country’s economic interests from political influence. Mr. Chatumongol is known to value the independence of the central bank, whose mission is to guard against monetary instability. On the other hand, Dr. Virabongsa supports a pro-growth strategy to use the country’s foreign reserves to finance the government’s policies and wants the BOT to cut interest rate to generate growth as well as weaken the baht to boost exports. Critics are concerned that if Dr. Virabongsa is appointed, the current BOT governor, Dr. Prasarn Trairatvorakul, who is more conservative on monetary policies, will have a hard time running the institution and the BOT will also be at risk of losing its independence. (Bangkok Post) (The Nation)
Thai baht reached a two-week high after foreign investors raised holdings of the nation’s assets due to optimism improving regional economies which is likely to boost export growth. On Monday, April 30, the bath value touched 30.72 per dollar, which is the strongest level since April 13, making a 0.4 percent increase from the previous month. This monthly gain in baht occurred after the US Federal Reserve Chairman, Ben Bernanke, stated he may add more stimulus if needed to boost the US economy. (Bloomberg)
Thai rice exports dropped by 63 percent year-on-year in March, followed a 27 percent drop in February, as the government mortgage scheme pushes rice prices well above competitors such as India and Vietnam, causing Thai rice to lose competitiveness in the world market. According to the Bank of Thailand’s senior official, Mathee Supapongse, rice exports had fallen due to flood disruption, but the substantial decline this year is a result of government policies implementation to boost farm income. The prices are expected to rise further as more paddy is pledged to this mortgage program. (Bangkok Post)
The Thailand consumer confidence index has risen for the fifth consecutive month to reach a 7-month high in April while the cost of living index in the same month has made a 21-month record high. The consumer confidence index rose to 77.6 in April, from 76.6 in March, according to a survey by the University of the Thai Chamber of Commerce’s Economic and Business Forecasting Center shown on Wednesday, May 2. The higher confidence level was a result of consumers’ optimistic expectation from the minimum wage hike and higher consumer spending especially during the long Songkran holiday. Nevertheless, consumers showed concern over the high cost of living following the rising oil and product prices. (Nasdaq) (Bangkok Post) (The Thai Financial Post)
Thailand is planning to develop its own port and supply chain, a senior Thai official told the UK’s Port Strategy journal. Thai government last week gave approval for the plan to build a new port on Thailand’s Andaman Sea at the small fishing village of Pak Bara instead of waiting for Burma’s decision to go ahead with the Dawei port project. The British magazine also quoted the Thai Deputy Transport Minister Chadchart Sittipunt’s statement to give concession and go ahead on the Pak Bara port project. The plan also calls for Pak Bara to be connected by rail from outside similar to Thailand’s Port of Laem Chabang on the eastern coast. This new plan, together with Japanese industrial companies’ shifting interest to develop Thilawa Port close to Yangoon, may signal the end of the multi-billion dollar dream of creating a major industrial center at Burma’s southeast coastal city of Dawei. (Thai BSAA) (The Irrawaddy)
Production costs in Thailand have risen 16 percent on average due to the minimum wage rise to 300 baht per day, resulting further in higher prices of goods of nearly 14 percent, according to Dhurakij Pundit University Research Center (DPURC). The research also indicated that 38 percent of 900,000 SMEs in the seven provinces might have to stop hiring workers who are under 20 years old in the next eight months, for they will have the right to a wage increase within 12-18 months. Some 76 percent of employers have chosen to adjust by encouraging more efficiency in their employees, 61 percent have tried to reduce other production costs apart from labor costs, and 45 percent will start using machinery as a replacement of labor. Mr. Kiatanan, the director of DPURC also stated that the wage increase will affect Thailand’s ability to compete in the long-run, particularly labor intensive enterprises. (Thailand Business News)
The Credit Guarantee and Investment Facility (CGIF) will begin offering bond guarantees for private firms in ASEAN, including Thailand in July, according to the statement of Mr. Chakkrit Parapuntakul, director-general of the Public Debt Management Office on Wednesday, May 2. The fund, with capital of 700 million US dollars (216 billion baht), was established last year by the 10-member ASEAN, together with China, Japan, and South Korea, in collaboration with the ADB. So far, approximately 80 firms have applied for the guarantee from the CGIF. Both listed and non-listed firms are eligible; however, they must obtain a credit rating on debts by local or international rating agencies. The CGIF will also have to work closely with ASEAN commercial banks on this program. (The Nation)
The Stock Exchange of Thailand (SET) index reached a new 16-year high on Wednesday, May 2, at 1,239.06 as global investors cheered good news on the improvement of factory output in the US and China. Moreover, the next day, on Thursday, May 3, the SET index finished even higher in seven straight trading days, climbing more than 45 points, or 3.9 percent, to close at 1,240.03 with the trade volume of 5.052 billion shares worth 38.412 billion baht. Thai stocks are expected to have negative bias on Friday, with the weakness of the oil market pressuring on energy shares and sentiment elsewhere in Asia remaining cautious about prospects for the US recovery. (The Nation)
Foreign investors were also more active in trading Thai bonds with the first quarter average daily trading of bonds with duration of one year or more and short-term bonds showing an increase of 48 percent and 29 percent, respectively, from the year before. (The Nation) (Reuters) (RTT News)
Security
Prime Minister Yingluck Shinawatra visited Pattani last Sunday to meet with religious leaders from the five southern border provinces to follow up and give assurances on the security situation. Following a briefing with local security agencies, Prime Minister Yingluck stressed the need for cooperation between religious groups and authorities. She conceded that with 66 agencies operating under 17 ministries, the government’s work in the South requires better coordination as well. Further, she announced that more checkpoints would be set up in the interest of security for residents, and as well as the establishment of a new committee focused on solving the problems in the South. Finally, in cases where security budgets are insufficient, she pledged to inject more funding. (Thailand Business News) (Pattaya Mail) (Bernama)
More violence was reported in Pattani and Narathiwat this week. On Monday in Pattani’s Panare district, a woman was injured by a grenade attack in her shop that sells farm equipment. Reports indicate that two men arrived on a motorcycle, threw the grenade into the shop, and then fled. On Tuesday morning in Mae Lan district, a roadside bomb at No 418 Highway in Bang Wang Kwang killed three paramilitary rangers and wounded seven others. On Thursday afternoon in Saiburi district the chief of sub-district Thung Kla and his three deputies were killed when armed assailants in a passing pickup trick fired on them with M16s an AK-47s. The gunmen stopped and stole 300,000 THB in cash from the vehicle. This money was to be used to pay salaries of defense volunteers. On Monday in Narathiwat’s Rangae district, a roadside bomb injured two defense volunteers. Militants fired onto the volunteers and there was a brief exchange of gunfire before the militants fled. In that same afternoon, four gunmen wielding assault rifles attacked an outpost guarded by two security defense volunteers. In the ensuing firefight, one volunteer was killed, while the other volunteer died later in the hospital. Afterward, authorities on the scene found two pesticides cans filled with explosives. On the following day, 100 Thai security forces, made up of paramilitary rangers and police, raided 150 houses in Chanae district searching for the gunmen involved in Monday’s attack. No arrests were made, but two rifles and three boxes of ammunition were seized in the raid. (Bangkok Post) (The Nation)
A faction of the Democratic Karen Buddhist Army (DKBA) raised tensions on the Thai-Myanmar border this week after it closed 12 border checkpoints between Tak and Kanchanaburi province. The move came in retaliation to the Thai government’s decision to list the faction’s leader on Thailand’s “five most wanted list” for involvement in the drug trade. Vendors and businesses on both sides of the border have been affected. DKBA commander Lt-General Na Kha Muay has reportedly mobilized forces and told troops to be ready for combat. Meanwhile, Thailand’s taskforce of the 4th Infantry Regiment, based in Mae Sot, has been put on alert in Mae Sot and Phop Pra districts. (The Nation) (The Irrawaddy)
Tensions flared on Thailand’s other border with Cambodia, as Thai and Cambodian security forces reportedly exchanged gunfire in a ten-minute skirmish. Deputy military commander of Cambodia’s Preah Vihear province, Lt. Col. Men Ly, claims Thai forces attacked a Cambodian patrol, wounding one of his soldiers. Meanwhile, Thai Army spokesman Col. Sansern Kaewkamnerd asserts that Thai soldiers returned fire after illegal loggers shot at them and fled back into Cambodia. In a separate incident, a Thai soldier stepped on a landmine while on patrol in Si Sa Ket’s Khantaralak district. The explosion reportedly damaged both his legs below the knees. (Fox News) (The Nation)
Policemen clashed with suspected drug traffickers on the bank of the Mekong river in Nakhon Phanom’s Muang district on Thursday morning. At around 1:30am, police spotted four men arrive in a longtail boat from the other side of the river. When one man stepped out with a backpack, police sought to initiate a search. The men in the boat threw a grenade at police and opened fire. After a brief exchange, the four men fled in the boat, leaving behind a backpack with 10,000 methamphetamine pills, 10,000 methamphetamine pills and an unspecified amount of ya ice and crystal meth. (Bangkok Post)
In Bangkok’s Bueng Kum district, police arrested two suspects as they were about to deliver illegal drugs to a customer. A search of their car and a subsequent raid of the suspects’ house turned up 1,020,000 methamphetamine pills. The suspects confess to being part of a northern drug syndicate and that they bought the drugs from Talad Thai market in Phatum Thani. They also told investigators that the drugs were smuggled in from Myanmar. (The Nation)
Following the fatal crash of a Porsche that had been driving 280 km/hour on one of Bangkok’s tollways in the early hours last Saturday, police are considering harsher measures against car racing in the city. Speed racing among Bangkok’s elite is a problem that Pol Maj Gen Worrasak admits is beyond the police’s ability to address due to limited resources. When confronted by police, racers often speed away, and police generally do not chase them. If racers are caught, the most severe penalty is a fine – which is hardly a punishment for the very rich. However, the police say they are making plans to install more CCT cameras and radio frequency identification systems along popular racing routes. (Bangkok Post)
Thailand’s Ministry of Information and Communication Technology, the Electronic Transactions Development Agency, the Thailand Computer Emergency Response Team, and Symantec have recently signed a Memorandum of Cooperation (MoC) to establish a national cyber security system. A digital threat monitoring system will be established and operated to monitor and analyze threats within the network. Permanent Secretary of ICT Ministry Jeerawan Boonperm explained that the MoC would establish a system that protects users and analyzes threats, such as malwares. “The new technology would significantly assure safety for online banking for people and businesses,” she said. (Future Gov Asia)
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