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2 ASIA
HAND Thailand's rocky road
ahead By Shawn W Crispin
(The following is an excerpt from a
longer presentation ATol Southeast Asia editor
Shawn W Crispin made on Tuesday in Bangkok to a
group of foreign-equity and investment-fund
representatives now touring the region with US
investment bank JPMorgan.)
If indeed
investors prefer certainty in making their
investment decisions, then Thailand is arguably
not the best place for your
money
over the short or medium term. With the return of
democracy later this year, Thailand is nonetheless
headed toward a highly uncertain political period,
one likely to be plagued by intense factional and
political party infighting and the incessant
shadow threat of another military intervention.
Although the ruling Council for National
Security (CNS) will follow through on its pledge
to hold democratic polls in December, the military
has no intention of fully relinquishing its hold
on political power. Knowledge of the inner
workings, personalities and proclivities of the
opaque institution, as it was before last
September's coup that ousted prime minister
Thaksin Shinawatra, will be crucial to
understanding Thai politics and policy in the
months and years ahead.
The new and less
democratic constitution passed at last month's
national referendum, which contrary to many
commentators' predictions was endorsed by 57% of
voters, in effect provides for a future role for
the military in day-to-day politics. Appointed
military proxies or outright representatives will
make up nearly half of the 150-member Senate,
which will have extraordinary new oversight powers
to censure and potentially remove elected
politicians with a mere three-fifths majority of
the Upper House.
It's one of many new
political circuit-breakers the military has
installed to weaken the executive branch and avoid
a recurrence of the political juggernaut of
Thaksin's Thai Rak Thai (TRT) party. Only
one-fifth of the members of Parliament will be
needed to file a no-confidence motion against the
prime minister (it was previously two-fifths) and
only one-sixth to file a motion against a
minister. These new measures, meant to improve
oversight of elected politicians, will also likely
hobble the parliamentary process, resurrecting
complaints from the 1990s that slow-moving and
fractious democracy is bad for business and
investor confidence.
The
military-influenced Senate will have powers to
delay legislation and must be consulted through a
joint session with the Lower House to amend the
constitution. The Council of State, meanwhile, is
readying new national-security legislation, which
in times of national crisis could entail a
breakdown of the parliamentary order, and will
give the military legal protection to launch
future coups.
Questions about the legality
of last year's military intervention still loom
heavily over the CNS - despite a blanket amnesty
the military wrote into the new constitution to
protect itself, its investigative committees and
legislature from future prosecutions. Pro-Thaksin
politicians, including new People's Power Party
(PPP) leader Samak Sundaravej, have already
indicated they plan to raise legal challenges in
Parliament, including in relation to TRT's
dissolution in May and the five-year bans on its
111 executive members, including the exiled
Thaksin.
In response, a government led by
the Democrat or the Motherland Party could pursue
with vigor lingering corruption charges against
Samak, potentially knocking the newly formed
party's leader from politics. Samak also has a
two-year jail sentence hanging over his head from
a criminal-defamation conviction that could come
into play. All in all, fierce and potentially
destabilizing parliamentary clashes loom ahead as
Thailand transitions back to a limited form of
democracy.
Those clashes will quickly put
the military's back-to-the-barracks pledge to the
test. To what degree the Thai military actually
exercises the broad new discretionary powers
they've vested in themselves will be largely
determined by which of three distinctly different
career soldiers is elevated this week to the
army's top spot. The selection between an extreme
hardliner and two less known moderate candidates
will reflect just how secure the top brass feel in
their positions after toppling Thaksin and a year
of purging his loyalists from the military and
bureaucracy.
The military reshuffle is
nearly as important a signpost for the country's
political direction than the results of the
upcoming polls. A hardline camp, led by General
Saprang Kalayanamitr, appears to favor the
military continuing to play a prominent role in
day-to-day politics after the elections. A more
moderate camp seems to favor a more
behind-the-scenes political presence. It's not
clear that these opposing philosophies represent a
full-blown schism, yet. But the potential for
future intra-military instability also
looms.
The decision will be the first of many crucial
personnel appointments that the military and its
proxies will make that shape Thailand's democratic
transition. Another concerns what role, if any,
current army commander and CNS leader Sonthi
Boonyaratklin decides to play in the next
government. Speculation has centered on whether he
and the military would form their own political
party to contest the upcoming polls.
More
recent indications are that Sonthi will trade in
his khakis for a seat in the Senate or,
alternatively, has already been given the nod by
the Democrat and Motherland parties that he will
be appointed deputy prime minister for security, a
security-czar position newly created specifically
for him.
Either appointment would give the
CNS a prominent role in the next coalition
government and avoid the risk of contesting
popular polls under a military-affiliated party
that would likely fare poorly. Sonthi's entering
politics will nonetheless open him up to potential
opposition-led censure motions, including over his
role in leading last year's coup. How the military
would react to such an attack is another looming
wild card.
Outside of these intra-military
maneuverings is a shifting political-party
landscape, which was fundamentally altered by the
May 30 court-ordered dissolution of Thaksin's TRT
party and the five-year ban on politics slapped on
its 111 executive members. Three or four main
political parties are expected to contest the next
polls, with the previous opposition Democrat
Party, the TRT-influenced People's Power Party,
and the new Motherland Party all expected to
garner significant votes.
I predict that
the Democrat and Motherland parties will form the
core of a new coalition government, also
consisting of the smaller Chat Thai, Rak Chat and
Mahachon parties, convened under a national-unity
banner. That will put the PPP and a smattering of
other smaller parties in the opposition.
I
also predict that the marriage won't last longer
than two years. As was the case throughout the
1990s, the coalition government will likely
dissolve because of factional infighting,
conflicts over government resources and
allegations of the PPP-led opposition playing
money politics to lure enough members of
Parliament (MPs) into its camp to break the
coalition government.
That would arguably
set the stage for a new military intervention,
completing the age-old cycle of Thai politics:
coup, constitution, political parties, election,
legislature, honeymoon period, crisis, new coup,
and the installation of another - though not
necessarily interim - military-appointed
government that with the perceived failure of
elected politicians would likely be less committed
to returning the country to democracy.
Parties and personalities Three
main and four small parties will contest the next
polls, and each is expected to run on similar
populist policy pledges. Nearly all of the
relevant political parties - including the
Democrats, who in the opposition often railed
against Thaksin's perceived profligate populism -
plan to campaign on pro-poor policy platforms,
pledging an array of government services, handouts
and goodies if elected.
The similarity in
approach shows how much Thaksin's TRT party has
changed the face of at least electoral Thai
politics. It's unclear how relevant these campaign
promises will be to actual future economic-policy
making and the state of the national finances,
which at present are at a manageable level. A
constitutionally mandated medium-term
fiscal-management framework, aimed at maintaining
medium-term fiscal stability, should keep actual
populist and off-balance-sheet spending in check.
The Democrats, Motherland, and Chat Thai
parties are known to have strong followings in
separate geographical regions - south, northeast
and central respectively - where residents
historically
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