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Year ends on high note for Thai prime
minister
By Marwaan Macan-Markar
BANGKOK - The signs are everywhere, on the
streets and shopping malls to the stock market and the
conference halls: Thailand is on a roll. There is little
mystery as to who is receiving bouquets for guiding the
country toward this spirit of good cheer - Prime
Minister Thaksin Shinawatra.
This week served up
the latest reminder of this perceivable faith Thais have
in Thaksin. On Monday, the media reported that the prime
minister had been voted the "Person of the Year" in an
independent poll conducted by a local university.
Thaksin's overwhelming popularity - he got 82.5
percent support from the 2,203 people surveyed in
Bangkok and four other cities - placed him way ahead of
the runner-up, a high-profile forensic expert who
received 3.6 percent support.
In another poll by
the Assumption University, Thaksin was voted the
country's "Outstanding Politician" by 86.4 percent of
those surveyed.
That Thaksin's stock is hot
property these days was also underscored when he
delivered a public lecture here Monday on the future of
the country's economy, which is currently worth an
estimated US$136 billion. He drew a capacity crowd,
including hundreds of businessmen and policymakers.
During the lecture at the Bangkok Bank's
headquarters, he reiterated the central features of his
administration's economic agenda.
His
three-year-old government will continue with its
dual-track economic agenda, Thaksin said, referring to
the policies of increasing domestic demand and consumer
spending, while promoting export-led growth.
Thaksin, whose Thai Rak Thai (Thais Love Thai)
party won a thumping victory at the 2001 general
elections, also rebuked his critics, who have argued
that the country is being set up for an economic crash
similar to the 1997 financial meltdown.
"The
working style of this government is different from
others," a confident Thaksin asserted. "We move fast to
implement our projects. If there are problems we fix
them. If the government is not bullish on the country,
who will be?"
The numbers flowing in suggest
that Thaksin's touch is a winning formula - at least for
now. This year, for instance, the Thai economy is
expected to grow by 6.4 percent, outpacing its Southeast
Asian neighbors. By the end of 2003, Thailand's exports
are poised to reach $79 billion, a 15 percent spike from
the $68.81 billion last year.
These robust
statistics have already prompted some analysts to
suggest that Thailand's economy may be well on its way
to achieving the 8.5 percent annual growth that it
maintained from 1984 to 1995.
"Mr Thaksin's
economic management and the political stability that has
come with his control over parliament had boosted
investor confidence despite initial doubts about his
government's commitment to financial reforms," the
English-language Bangkok Post said on Monday.
Lending weight to that view is the dizzying
heights that the Thai stock market reached by
mid-December. On December 18, the Stock Exchange of
Thailand (SET) index broke new ground, when it passed
the 700-point level for the first time since the 1997
economic crisis. Trading was worth 48.91 billion baht
($1.2 billion).
This may have critics
questioning the depth and sustainability of economic
activity, but the results of a survey last week showed
that regional fund managers are excited about the SET's
performance and consider it Asia's best over a 12-month
period.
But it is not just in the world of high
finance that Thaksin, a telecommunications tycoon, is
earning praise. One of his populist programmes -
encouraging each village in the country to produce
crafts that it has a knack for to be then marketed by
the government - has enjoyed early success.
Two
years after the "One Tambon (district) One Product"
scheme was launched to generate more income to the
country's 77,000 villages, the government has recorded
sales to the tune of 33 billion baht ($825 million) from
October 2002 to September 2003.
"The government
does not spoil the poor, we give them opportunities,"
Thaksin said.
The Nation, an English-language
daily, commented in an editorial on Tuesday:
"Encouraging rural people to become more entrepreneurial
also helps improve productivity from the farming sector
in that farmers are now learning to add value to their
farm products and locally available resources."
But there are critics who question
"Thaksinomics", as the prime minister's economic agenda
is known.
One area of concern is the mounting
personal debt that Thais are incurring as they indulge
in spending sprees due to the easy availability of
credit - trends that have caused concern in such
countries as South Korea, also recovering from the 1997
financial meltdown.
Stories of people earning
close to $600 a month buying new cars that cost 30 times
as much are among the frequently mentioned examples of
domestic demand. "Credit cards are also starting to be
flung around like confetti, just as they were before the
1997 crash," observed The Nation in a recent editorial
on "Vicious debt cycle makes its return". "This means
that people who really cannot afford them are being
signed up and then tempted to buy all manner of goods on
credit."
Average household debt has increased
from the equivalent of three times monthly income in
1994 to 5.5 times in 2004, it said.
"Thailand's
debt-driven boom looks fine today, but what happens when
the economy slows? This is no small risk when you
consider Thailand's unimpressive progress in ridding the
banks of poor loans," wrote William Pesek of Bloomberg
financial news in a commentary this week. Bad loans in
the Thai financial system remain significant, at 30
percent of assets.
For now, however, such
arguments are being largely drowned out by the sounds of
the busy cashiers' machines in malls and car
dealerships. In the feel-good factor in the air, many
Thais feel they can spend confidently with him in charge
of the economy.
On Monday, during his speech,
Thaksin also indicated that more good news was in the
offing due to the country's consumer-driven growth. In
2004, he said, economic growth should hit 8 percent and
thereafter strike a new high - 10 percent - by 2005.
(Inter Press Service)
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