Thai Prime Minister Abhisit Vejjajiva hopes an early election will be a “new beginning” for his divided country, but the result could just as easily be more unrest and policy paralysis as neither faction is likely to accept defeat gracefully.
Standing in his way is former Thai prime minister Thaksin Shinawatra, who commands a powerful opposition movement from exile and is determined to avenge his overthrow in a 2006 coup, a graft conviction and the confiscation of US$1.4 billion in family assets.
“It’s a zero-sum game and this election will only heighten the level of confrontation and polarization,” said Somjai Phagaphasvivat, a professor of politics and economics at Bangkok’s Thammasat University.
“Thaksin has promised he will return and his enemies are afraid he will want revenge. They will try to stop him and although the situation will be contained for now, after the election another face-off is inevitable,” Somjai said.
Oxford-educated Abhisit sees the July 3 poll as a chance to finally win an unambiguous mandate. It will mark Abhisit’s first test of popular support since he came to power in a 2008 parliamentary vote tainted from the start by allegations the military stitched together his coalition.
Thailand has suffered five years of political turbulence and sporadic street violence in a protracted crisis that pits the establishment elite and its military allies against “Red Shirt” protesters drawn mostly from the rural poor and urban working class.
Thaksin’s refusal to go quietly after the coup has fomented instability, making him a figurehead for the opposition to the “old money” elite. He commands the devotion of the poor even though he is a wealthy former telecommunications tycoon.
The election will be a tight race between Abhisit’s Democrat Party and the pro-Thaksin Puea Thai Party.
Neither is likely to win a majority, so more behind-the-scenes deals are in prospect to form a new coalition government, with small parties more interested in patronage than policies.
Even before that, allegations of vote-buying and contentious Electoral Commission rulings will ensure a heated campaign.
Already, rumors swirl of an impending military coup or clandestine plots by “invisible hands” keen to derail the election and preserve the status quo. The country has had 18 military takeovers or attempted coups since 1932.
Thaksin’s Red Shirt supporters, who paralyzed Abhisit’s government last year before the military quelled their 10-week protest at the cost of 91 lives, have promised to honor the result, as long as the election is fair, but the military and judiciary have frequently moved against those not aligned with the traditional power cliques that have dominated Thai politics for decades. Against that background, rank-and-file activists may be in no mood to accept defeat.
Puea Thai and its Red Shirt affiliates see the smooth, 46-year-old Abhisit as a stooge for a plutocratic alliance of royalists, conservative elites and military top brass threatened by Thaksin’s reforms and his mesmerizing influence on millions of rural poor wooed by his populist policies.
Any hint of interference by these forces could spark a new round of violent Red Shirt protests or a military coup framed as a rescue mission to reset a dysfunctional democracy, analysts say.
The royalist, nationalist “Yellow Shirts” took to the streets to destabilize two governments led or backed by Thaksin in 2006 and 2008, and many commentators believe that, despite a drop in their support, they could strike again if Puea Thai forms a government and seeks an amnesty for its de facto leader.
“The Yellow Shirts might not like Abhisit much, but they’re relying on him,” Somjai said. “I doubt they will allow Thaksin to make a comeback.”
Some Yellow Shirts have turned against the prime minister completely and are advocating abstention in the polls, their ultimate goal being an appointed parliament. It is unclear what support they command, but this is another wild card.
Pro-Thaksin Puea Thai remains popular among the rural and urban working classes, but the Democrats are in good shape and Abhisit is working overtime to convince Thais to put the past behind them.
During a marathon 15-hour Cabinet meeting last week, the government approved US$4.5 billion in projects, including low-cost housing loans, assistance to landless farmers, wage rises for state employees and increased education spending, which could help it tap Puea Thai’s support base.
An Abhisit-led government may also seem a safer bet for would-be coalition partners worried that a spell in office for Puea Thai would be limited by harassment from a military and elite looking for pretexts to intervene.
For investors, a Democrat victory might be welcomed as ensuring a continuation of policies that helped the country rebound from the global economic crisis and political unrest last year. The economy expanded 7.8 percent last year.
Thailand is still seen as an attractive destination for foreign direct investment and there have been no significant changes in trends in investment flows during the political crisis, suggesting investors are happy to stay the course.
External factors, including the global economic crisis and the freezing of work at a major industrial park from 2009 to last year, have led to declines in investment, but analysts say the country boasts stronger prospects than other rising regional economies such as Vietnam, where fiscal policy, excessive bureaucracy and poor infrastructure remain a concern for foreign businesses.
After a wobble when the protests turned violent last year, foreign investors ploughed money into the stock market in the second half. Over the full year, a net US$1.92 billion flowed in, helping the main index rise 41 percent. It has risen more than 4 percent this year, the best showing in Southeast Asia, outperforming the MSCI Asia ex-Japan stock index.
“Most investors see a new Abhisit government as the most appealing. He has a credible image, good economic clout and with the Democrats in power, political stability looks more likely,” said Danny Richards, Southeast Asia specialist at the Economist Intelligence Unit. “The main worry is that if Puea Thai form a government or there’s behind-the-scenes intervention, there’ll be a backlash. There’s no doubt Thaksin’s return to prominence is undermining the potential for a smooth election.”
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