Global Economics

'We Will See a Lot of Repression in Thailand'


Thai anti-government protesters cheer during a rally in Bangkok on May 15

Photograph by Apichart Weerawong/AP Photo

Thai anti-government protesters cheer during a rally in Bangkok on May 15

Congratulations, Thai anti-government protesters: You have now gotten what you wanted. Since late last year, you helped paralyze the country’s political system, saying what Thailand urgently needed was not a government with a mandate from the voters but instead an unelected group of Thais empowered to fix the country’s dysfunctional politics. (Never mind the political system was rendered dysfunctional largely by your side, which hasn’t managed to win an election in two decades.)

And now, with the military staging yet another coup, Thailand indeed has a group of unelected officials in control. Yesterday, Army Chief Prayuth Chan-Ocha went on national television to declare the military was now in charge of the country. “To restore peace back to the country in a short time and to reform the country’s politics, economy, and society, the Thai military, army, navy, air force, and police have seized power from May 22 onward,” he told the nation.

The junta is calling itself the National Peace and Order Maintaining Council. Not as sinister an acronym as the one formerly used by the generals in next-door Myanmar, where the military named itself SLORC (State Law and Order Restoration Council), but still suitably creepy.

Having successfully staged a dozen coups since 1932, Thailand’s military has had plenty of practice in forming regimes to replace democratically elected governments. Some investors are optimistic this coup will lead to an end of the instability that has plagued the country. Mark Mobius, executive chairman of Templeton Emerging Markets Group, told Bloomberg News by e-mail “we view the current military coup as likely overall positive as it creates a more stable environment.” Alan Richardson, investment manager at Samsung Asset Management in Hong Kong, told Bloomberg “we are approaching the endgame to the political crisis.”

Investors certainly didn’t panic today. Thai stocks fell in morning trading, but with the benchmark SET Index down less than 1 percent by the end of the day, there was hardly a rush for the exits. Thailand is a major production base for the automobile industry, and while automakers such as General Motors and Toyota suspended their night shifts (the military has imposed a 10 p.m.-to-5 a.m. curfew), production resumed for the daytime operations.

Still, it’s not clear the junta will be able to deliver its promised peace and order so easily. “There will be resistance and defiance against the military coup,” Thitinan Pongsudhirak, director of the Insitute of Security and International Studies at Bangkok’s Chulalongkorn University, told Bloomberg Television today. “The coup makers, the generals, will be forced to be repressive. I think we will see a lot of repression in Thailand.”

The generals got off to a quick start. The military ordered political leaders to report to army command, including former Prime Minister Yingluck Shinawatra, ousted by the constitutional court on May 7, and banned 155 people from leaving the country. Several pro-Thaksin leaders were arrested, Sean Boonpracong of the United Front for Democracy told Bloomberg. In addition to closing schools for several days, banning political protests, and taking international TV channels off the air, the regime had a warning for social media operators, saying they should prevent messages that incite violence or break the law.

The junta has reason to be worried. They overthrew the government of populist tycoon Thaksin Shinawatra in 2006, and since then the divisions between his “Red Shirt” supporters and the country’s “Yellow Shirt” establishment have only grown deeper. The pro-Thaksin forces might not allow this latest coup to stand without a fight. “Things could escalate very, very quickly if the Red Shirts decide to move,” IHS Jane’s Jon Grevatt told Bloomberg Television today.

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Einhorn is Asia regional editor in Bloomberg Businessweek’s Hong Kong bureau. Follow him on Twitter @BruceEinhorn.

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