Thailand’s economy at a tipping point as markets wake up to the potential for political turmoil

[webfact]

Foreign credit and market analysts assume that the coalition government led by Move Forward Party leader 43-year-old Mr Pita Limjaroenrat will come to power smoothly in August, given the potential for political instability and economic consequences if this does not happen. It comes with Thai exports in freefall and the country’s manufacturers nervous about the policies to be pursued by the new administration.

Baht is down against the dollar but what may take Thailand’s leadership by surprise is both the perception of the election result outside the kingdom and the views of young voters among the over 14 million citizens who came out in force to propel the Move Forward Party to the top of Thai politics.

Thai officials and policymakers may be underestimating the negative impact that any potential political turmoil may have on the country’s economy this year or even the potential of a downturn in foreign tourism if the proposed Move Forward Pheu Thai coalition government, which is seen internationally as the will of the people in the May 14th General Election, is thwarted or forced out of the running by a political surprise. The baht has already lost 3.3% against the dollar since the mid-May election and international media coverage of the kingdom has focused on the youth and appeal of what they see as Thailand’s charismatic PM in waiting, Pita Limjaroenrat, the youngest in over 78 years.

 

Thailand, on Tuesday, posted disappointing figures for April’s export volume with shipments down 7.6% on last month’s figures while falling 7.3% compared to this time last year.

 

The bad news for the country’s manufacturing and export sector comes amid rising fears of potential instability with tensions within the eight-party coalition trying to form a new government led by 43-year-old Move Forward Party leader Pita Limjaroenrat in the face of threats to his future in politics as the Election Commission carries out an intensive probe into a media shareholding held by Mr Pita in a defunct firm as part of his duties as executor of his father’s estate before the 2019 General Election.

 

by Joseph O' Connor

 

Full story: https://www.thaiexaminer.com/thai-news-foreigners/2023/05/30/thai-economy-faces-a-political-tipping-point-pita-limjaroenrat-government/

 

-- © Copyright Thai Examiner 2023-05-31

 

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[hotchilli]

If MFP are thrown out of politics Thailand will be viewed as a doomed country, much like Myanmar after the military took over.

Nations have sat back and tolerated the last coup and subsequent shenanigans of the leaders.

However if this new democratically effort is thwarted vies will quickly change.

Investment will go elsewhere, tourism will depend on the number of street protests and there intensity.

Burt since when did Thailands leaders really care about public opinion... only when it hits their pockets.

[RichardColeman]

Pretty sure its the unelected senators that are the problem in the numbers

[Srikcir]

4 hours ago, webfact said:

The baht has already lost 3.3% against the dollar since the mid-May election

And

4 hours ago, webfact said:

Thailand, on Tuesday, posted disappointing figures for April’s export volume with shipments down 7.6% on last month’s figures while falling 7.3% compared to this time last year.

Might that be the cumulative affect of the EXISTING government now out of office having done poorly for the last 8 years for the economy and income equality? Or even an effect caused by the failed re-election of the Prayut government to use its political "suicide pill" (ie., control of the Senate) to slow (if not damage) peaceful transition to the newly elected government? One might also look to the EC's post-election posture to threaten same peaceful transition to a new government that has earned a substantial popular vote.

 

Futhermore, international exchange rates are driven by a complexity of past & current events outside of one's nation's current economic policies, ie., by its major trade partners. 

Then there's the "alternate truth":

"Thai Baht Gains Most in 5 Weeks as Opposition Parties Lead Vote" ref. Bloomberg.

[bignok]

Baht is still high.

[wombat]

What turmoil?

All is going smoothly...covid is being pushed into the furthest regions of the mind and forgotten...bars are opening tourists are spending.

All is good in the Land of Smiles.

[dinsdale]

4 hours ago, webfact said:

potential political turmoil

Defined as 250 military appointed senators. That's it. If the senate was freely elected and not planted to suppport the military and uphold the three pillars there would be no turmoil.

[Gsxrnz]

The odds of Pita being permitted to become prime minister are akin to the odds of it raining meatballs - very slim. 

[anchadian]

8 minutes ago, dinsdale said:

Defined as 250 military appointed senators. That's it. If the senate was freely elected and not planted to suppport the military and uphold the three pillars there would be no turmoil.

Exactly.

[topt]

1 hour ago, bignok said:

Baht is still high.

Compared to what and why?

[herfiehandbag]

1 hour ago, Srikcir said:

Might that be the cumulative affect of the EXISTING government now out of office having done poorly for the last 8 years for the economy and income equality 

Perhaps reinforced by the very obvious presence still in office of the Prime Minister, Ministers and Government which was so emphatically rejected in the recent election, and the suspicion that they will remain in office.

[Nong Khai Man]

5 hours ago, bignok said:

Baht is still high.

Yep, Too HIGH !!

[bignok]

4 hours ago, topt said:

Compared to what and why?

5 to 10 years ago

[kinyara]

6 hours ago, bignok said:

Baht is still high.

I think that is just as much or more due to failed economic policies in countries whose currencies have weakened against the baht.

[bignok]

6 hours ago, Gsxrnz said:

The odds of Pita being permitted to become prime minister are akin to the odds of it raining meatballs - very slim. 

Be yummy

[jacko45k]

19 hours ago, kinyara said:

I think that is just as much or more due to failed economic policies in countries whose currencies have weakened against the baht.

Yes, countries that live on debt!