Thailand has found much-needed stability under the Abhisit Government but maintaining it is a problem
IT IS – apparently more than most new years – the season to note anniversaries; 240 years since Cook’s Endeavour arrived on our shores, 200 years of Peugeot, 75 years of Elvis and 20 years since Homer, Bart and Mr Burns began piling up profits for Rupert Murdoch.
It was eight years ago this month that Guantanamo incarcerated its first suspected Muslim terrorist and, in torture of a different kind, 35 years ago that Japan inflicted Hello Kitty on an unsuspecting world.
Troubled Thailand, in many ways South-East Asia’s political and economic barometer, has been noting two more sombre anniversaries. It’s been five years since the tsunami devastated its coast, killing 5000 people and crippling much of its huge tourist industry. And it’s been a year since the aristocratic 45-year-old Abhisit Vejjajiva became Prime Minister, which is 11 months longer than most people thought he would last.
I interviewed Abhisit a year ago, just after he became Thailand’s fourth leader in 12 months. He gave his wobbly new Government two goals: to restore unity to a country divided by deep red-yellow/city-rural/rich-poor schisms in the north and a virtual Buddhist-Muslim civil war in its south, and to fire up the economy, which had shrunk by 4 per cent in 2008 – one of the world’s deepest recessions and a self-inflicted one exacerbated by its coups and tourist turmoil at its airports.
A year on, Abhisit is delivering handsomely on the latter. The Thai economy began growing again in mid-year, which is when Abhisit and his capable Finance Minister Korn Chatikavanij predicted it would start to turn around.
Just before Christmas, Abhisit took to the airwaves to laud his Government’s first year. He told Thais his Government’s main achievement had been economic: 4 per cent growth in the fourth quarter of 2009, with inflation and unemployment tamed.
Abhisit cited his biggest achievement was to halve Thailand’s jobless rate. That’s an important advance but, truth be told, Abhisit’s biggest achievement is to have stayed in office so long.
A year ago, Thailand was being cast as close to ”failed state” status. But as Abhisit recently told The Bangkok Post: ”after one year, the export and tourism growths have become positive and I have kept my promises in implementing all major policies – raising farm product prices, free education, welfare for elder persons – and many more are in the pipeline.”
”I can say I have achieved more than many other former prime ministers.”
Abhisit and Korn have charted Thailand out of its first recession in 11 years a quarter earlier than expected, and the all-important Thai business community is optimistic for a huge GDP bounce this year.
Inflation and interest rates have been reined in and, with Korn’s pump-priming and economic stabilisation moves well entrenched, the ground has been prepared for such a rebound.
One of Thailand’s richest men, Dhanin Chearavanont of the property-to-agribusiness company CP Pokhpand, says the economy could expand 10 per cent this year if Abhisit gets the politics right and stabilised. The Government predicts GDP growth at a conservative 3-4 per cent this year.
That’s an important endorsement from the influential Dhanin, but also a very big if. It’s a qualification that speaks to the most significant failure of Abhisit’s first year in office and continues to threaten his tenure and Thailand’s stability.
Abhisit and Korn came to Bangkok’s mock-Florentine Government House plagued by demonstrations and hate, and while the heat and violence has been dissipated, Thailand’s deep social divisions have not.
A year on, Thailand remains as divided as it ever was, neatly split between the Bangkok-centred Abhisit-friendly middle class cast in yellow, the Thai King Bhumibol’s favourite colour, and the red-shirted mostly rural supporters of Thaksin Shinawatra, the thrice-elected populist who was ousted as PM in a 2006 coup by the Abhisit-friendly military.
Accused of huge corruption, the wealthy Thaksin has since been taking potshots at Thailand from various exiles, most recently surfacing in neighbouring Cambodia as ”special adviser” to the Hun Sen Government. Though never baldly stated – that would be fatal in Thailand – Thaksin is perceived as being anti-royal and seems to be biding time as the 83-year-old Bhumibol, the world’s longest reigning monarch after almost 64 years on the throne, teeters in poor health.
But Korn is showing a safe hand at the economy’s tiller and, in many respects, is a more attractive figure than his close friend since Oxford, Abhisit. Bright and charismatic, he used to run JPMorgan’s office in Thailand, where he became very wealthy as an investment banker, setting himself up for a tilt at game-changing politics.
Unlike many Thai politicians, Korn says he entered politics not to get rich but to modernise and cement its democracy. Many Thaksinistas would dispute that, claiming that blue-blooded Korn and Abhisit are puppets of the royalist establishment and military, which has never baulked at stepping into politics.
Abhisit says he is committed to parliamentary democracy and having got to office by party manoeuvring, must soon face an election to secure legitimacy and his steady hand on the economy.
It would be wrong to declare Abhisit and Thailand immune, or at least shielded, from further turmoil. This week, pro-Thaksin protesters stepped up pressure on the royalist establishment, demonstrating outside the holiday home of the military favourite and Privy Councillor, former PM Surayud Chulanont, to accuse him of corruption.
Thaksin claimed the demonstration had nothing to do with him but, a year since some welcome stability was introduced to this fractious country, few believe him or that Thailand’s problems are over to enable the Abhisit-Korn team to safely see out a second anniversary.