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Thailand’s Election Result - good news for Tourism?

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AJ Wood  Jan 01, 2008

On Sunday 23rd December 2007, almost 70% of eligible voters turned out to exercise their rights in the country’s first general election following the 19th September 2006 military coup, which ousted former Prime Minister, Thaksin Shinawatra.

The People’s Power Party (PPP), that rose from the ashes of Thaksin’s Thai Rak Thai party were the winners, with 48% of the vote, with the Democratic Party in second place with 34%. Five other parties made up the remaining 18%.

The challenge now is to form a coalition government under the PPP leader, who is also a former Bangkok Governor, Mr Samak Sundaravej. It will not be an easy task. Firstly there is the hurdle of the Election Commission who may suspend or ban MP’s accused of cheating in the run up to the election. Their findings will not be made known for two weeks. Secondly, as the horse trading starts, and the smaller political parties jockey to form a coalition with a working majority, it is still unclear who PPP will fall into bed with and how long the love affair might last.

The outcome of the election did not, as constitutional planners had hoped, enable the smaller political parties to gain a foothold. The re-written constitution allowed for a greater number of smaller constituencies in the hope that smaller parties may have a greater influence. However the truth is that we still endure a polarized two party system and the outcome is a pointer to the rivalry between the two major parties. The PPP sweeping the board in the North and Northeast whilst the Democratic Party dominated densely populated Bangkok and the whole of the South.

Coup leaders, the Council for National Security (CNS), backed by the army, are not happy with the outcome. Many of the richer educated masses in Bangkok that initiated the demonstrations against Thaksin, which ultimately led to his demise, are also not happy. The voters in the poorer North are pleased as they hope that Thaksin will return to power, the man that gave them food to eat and money in their pocket and initiated populist policies, such as Baht 30 ($1.00) healthcare scheme.

Mr Samak Sundaravej, who many thought had not be a particularly successful Governor of Bangkok, makes no secret of the fact that he is a supporter (some say mouthpiece) of the former premier. Mr Samak has even gone so far as suggesting an amnesty for the politicians of the former TRT party.

So was it all worth it and how will this effect Travel and Tourism?

Few argue that a military junta has been bad news for Thailand Inc. Losses to private industries of Baht 500 billion ($14.7 billion) have been circulating for some time. The corporate and MICE markets have been badly affected by companies unwilling to conduct their business in a country ruled by an un-elected military dictatorship. Following the 23rd December election this is now a thing of the past and the industry has reacted cautiously over the result. The local stock market however surged 29 points (3.7%) following the election.

Tourism in 2008 is expected to generate an additional 1 million visitors, up from 2007’s estimate of 14.8 million. With a new government in place it is hoped that commerce and industry will be a top priority for the new government. Investor confidence was blunted under the old regime and many believe there is a brighter future. The new government will be under considerable pressure to perform and with an electorate worried how the new government will deal with Mr. Thaksin’s expected return to Thailand, from his self -imposed exile.

Thailand’s Tourism will fare better in 2008, however the swing doors of opportunity that opened to Thailand’s neighbors, following the coup, countries like Vietnam and China, may be difficult to swing closed, in the highly competitive market of attracting tourism dollars.

Thailand’s Election Result - good news for Tourism?

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