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Political Uncertainty to Take Toll on Thai Market: Report
Thai business leaders warned that economic recovery and new investment could be put on hold due to new uncertainties in the country's political arena, The Bangkok Post reported Wednesday.
They made the comment in the aftermath of a ruling by the National Counter Corruption Commission (NCCC) that Thai Rak Thai leader Thaksin Shinawatra should be barred from political office for violating asset-disclosure laws.
If the Constitutional Court upholds the decision, the election front-runner will be barred from office for five years.
With few observers expecting a ruling before the January 6 election, Thaksin could potentially win the election, serve as prime minister and then be forced out later.
Many analysts expect a delay in forming the next government already, if election fraud leads to significant numbers of disqualification and by-elections.
Prospects that new policies would spur the economy, regardless of which party forms the government, could be delayed well into 2001 depressed local stock and currency markets Tuesday.
The Stock Exchange of Thailand (SET) index Tuesday closed at 264.86 points, down 1.66, in thin trading of shares worth 1.244 billion baht (29.6 million U.S. dollars).
Krissana Unasuwan, vice-president of ABN Amro Asia Securities, was quoted as saying the NCCC decision "could keep the SET bearish for another six months."
"I think that we can expect delays in new direct and portfolio investment, since the decision raises questions about the stability of the next government," he said.
Soros Sakornvisava, senior vice-president of Bangkok Metropolitan Bank, agreed that investor sentiment would be affected.
"Foreign investors want to see the new government's policies on the economy, on fiscal and monetary policies, as quickly as possible."
Poosana Premanoch, president of the Institute of Social and Economic Policy, said Thaksin's declaration that he would keep campaigning would only bring further market confusion.
"The uncertainties are huge about how long Thaksin, if elected, would be able to stay in office, raising questions about the continuity of policies," he said.
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