Thai Prime Minister Abhisit Vejjajiva may need to do more to reassure foreign investors and tourists that stability is being restored after anti-government riots killed two and injured 135 people in Bangkok this week, a travel industry official said.
“It will take some time for the government to regain confidence,” said Apichart Sankary, president of the Association of Thai Travel Agents. “If we can’t create reconciliation in the country, we shouldn’t go out to assure foreign travelers. We may be seen as liars if we can’t deliver what we have promised.”
The capital and surrounding provinces are entering their sixth day of emergency rule after troops broke up violent protests in the Thai capital and a 2 1/2 week siege of the premier’s office ended. Today and yesterday were declared public holidays, following a three-day Thai New Year break.
The demonstrations dealt a blow to Abhisit, 44, who had to call off a regional summit of Asia-Pacific leaders last weekend after the so-called Red Shirt protesters stormed the meeting venue in the resort town of Pattaya. The group, which supports exiled former Premier Thaksin Shinawatra, contends Abhisit came to power illegitimately and is seeking his ouster.
“What we are now trying to do is to make sure there is a complete restoration of law and order,” Abhisit said yesterday. “We have to make sure that there are no further disruptions and rioting of any kind. We hope over the next few days to make sure that is achieved.”
Banks, shopping malls, markets and public transit were operating again yesterday.
Fitch Ratings yesterday cut its long-term foreign currency rating for the nation to BBB from BBB+, citing the civil unrest. Mark Mobius, whose Templeton Asset Management Ltd. has invested in Thailand for two decades, said the political turmoil poses a risk to Southeast Asia’s second-largest economy after Indonesia.
Moody’s Investors Service and Standard & Poor’s have said they may lower their foreign currency debt ratings as continued political instability hurts tourism revenue and spurs capital outflows. S&P yesterday lowered the local currency rating to A- from A.
Thailand’s SET Index and the baht have slid for the past five quarters. The 0.7 percent gain in the equities’ gauge this year compares with a 14 percent advance in the MSCI’s developing-nation index.
“The bigger challenge is how to stimulate investment in the medium term,” Finance Minister Korn Chatikavanij said in an interview broadcast on Channel 9 television yesterday. Thailand’s economy may shrink more than the government’s 3 percent estimate as visitors stay away and consumer confidence suffers, Korn said April 14.
Thaksin yesterday urged his supporters to be part of reconciliation talks with the government, the Associated Press reported, citing an interview with the former prime minister from Dubai. Police this week issued arrest warrants for Thaksin and other protest leaders on charges of inciting the demonstrations.
“We didn’t issue warrants against people who demonstrated, we issued them against people who’ve been rioting and who’ve been instigating violence,” Abhisit said.
The emergency was decreed April 12, the same day the government revoked Thaksin’s passport. The former premier, who left the country in August to evade a jail sentence for corruption, has since been issued a Nicaraguan passport, AP reported yesterday.
Backing From Ortega
Nicaraguan President Daniel Ortega said his government supports the return of Thaksin, according to an April 15 statement from the president’s office.
Thai police have informed Interpol of the arrest warrant for Thaksin, Cabinet member Sathit Wongnongtoei yesterday told state-controlled Channel 9. Abhisit said Thaksin is in Dubai. The United Arab Emirates is one of Interpol’s 187-member countries.
Thaksin, who gave speeches via video links and telephone at the protests, was removed by a 2006 coup that supporters say was orchestrated by Bangkok’s elite. He said in an April 12 CNN interview broadcast from an undisclosed location that he is ready to return to the country at the appropriate time.
Abhisit yesterday said he is seeking agreement on political reforms in the country and will call for elections when there’s stability and the threat of violence won’t mar voting.
Tourism Target Doubtful
The Tourism Authority of Thailand had expected 14 million visitors this year, a target that may be cut after the latest political unrest, said Juthaporn Rerngronasa, deputy governor of the state-run agency.
“There is no chance we will meet our target,” said Apichart of the Association of Thai Travel Agents. “If we are lucky enough to restore confidence, we may get 12 million.”
About 14.3 million tourists visited Thailand last year. The industry makes up about 12 percent of gross domestic product and provides around 4 million jobs.
Arrest warrants have been issued for 37 people, including Jakrapob Penkair, a protest leader and Cabinet minister under Thaksin, following the clashes. Three other leaders, Veera Musikapong, Nattawut Siakuar and Weng Tojirakarn, turned themselves in, and are being interrogated and say they are innocent, according to Tanee Somboonsap, a national deputy police chief.
Police denied bail for the three and have the right to hold them for investigation until emergency rule is lifted. The maximum penalties under the charges are jail terms of 7 1/2 years.