Sun, Oct 01, 2006 - Page 5 News List

More revealed about scale of Thaksin's business ploys


When fallen prime minister Thaksin Shinawatra endorsed a multimillion dollar government loan to Myanmar two years ago, it was billed as a chance to help the impoverished country finance construction and telecommunications projects using Thai suppliers.

What the billionaire tycoon neglected to mention was that the US$97 million in low-interest assistance would also benefit Shin Corp, a telecommunications conglomerate controlled by the Thaksin family which already was doing business with Myanmar's military junta.

The Myanmar loan, critics said, was just one example of how Thaksin used his office during his five years in power to boost the fortunes of his media and telecommunications empire and enrich his family.

Helped by government concessions, Shin Corp's stock soared 86 percent after he took office in 2001, although it has dropped recently. The Thaksin-controlled company Advanced Info Service more than doubled, while SC Asset Corp increased by 72 percent.

"I have so many cases where Thaksin abused his position to give favors to companies related to his family," said Somkiat Tangkitvanich, a researcher at the think tank Thailand Development Research Institute, who estimates that two-thirds of Shin Corp's market capitalization in 2003 was a result of government connections.

"If he was promoting growth-oriented policies that also benefited his companies, I wouldn't mind," he said. "But what he has done is focus only on his companies. That's the problem."

From the moment he took office in 2001, the 57-year-old businessman has been dogged by allegations of corruption and conflict of interest.

A court in 2001 narrowly found Thaksin not guilty of violating a disclosure law by hiding US$56 million in assets. Five years later, similar questions were raised again over the sale of Shin Corp to Singapore's state-linked Temasek Holdings for US$1.9 billion, after it was disclosed that the government amended a law in January to allow foreigners to own a 49 percent stake in Thai telecommunication companies -- up from 25 percent.

The corruption charges and the fact that Thaksin paid no taxes on the deal sparked massive protests that almost brought down his government. The graft allegations also contributed to the military coup that forced Thaksin from power.

"There were higher hopes for the Thaksin regime because anti-corruption was one of the pillars of his campaign," said David Lyman, chairman of the law firm Tilleke & Gibbins and an expert on corruption.

"But when it came time to put up or shut up, he didn't do either, which was a shame," he said. "He protected those people in his organization who were corrupt ... he set things up so that his companies could benefit from deals."

His supporters insist that Thaksin never took a cent from government coffers.

Since taking power, the military council has established several anti-corruption panels to investigate accusations of wrongdoing against the Thaksin government.

Much of its work, the panel said, will focus on public works projects approved by Thaksin -- including a scandal over baggage scanners and a rail link for Bangkok's new Suvarnabhumi Airport. Thaksin's private business dealings including the Shin Corp sale, however, may escape scrutiny because they did not directly involve government contracts.

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