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Uncertainty in the political landscape and investment environment
Whatever the outcome of the election for prime minister, the new civilian government will remain vulnerable to internal politicking and extra-parliamentary interference. Mr. Sreeta’s ouster also suggests that the influence of conservatives and the military on politics may grow, not weaken, in the coming years.
But his fall is unlikely to spark mass protests as sympathy for Pheu Thai has waned over its betrayal of the now-defunct Popular Front.
Another complicating factor is Thaksin’s political ambitions. The former prime minister’s one-year prison sentence is set to officially end on August 31, when he could make provocative moves.
A Padangtan government is likely to bolster his ambitions for political hegemony against his other coalition partners and the military. Thaksin’s two-decade struggle for political hegemony with the military looks set to continue, albeit within the confines of an uneasy alliance.
All of this is unlikely to do anything to restore investor confidence in Thailand. Policy continuity in the investment and economic spheres will remain elusive as political fragility is likely to persist.
While the previous government’s stimulus and tourism plans appear likely to continue, there will be more uncertainty about foreign investment priorities and the fate of current casino and marijuana legalization proposals.
Thailand is therefore still waiting for a lasting political system. The question is whether foreign investors are willing to stay in Thailand until they see that system take shape.
Harrison Cheng is a director at risk consultancy Control Risks.
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