Officially, the election was said to be incomplete, pending additional elections needed to fill those parliament seats left undecided by the failure of the polling stations to open. But it was obvious, advisers in Bangkok told International Adviser, that as the polling booths that managed to open finally closed on Sunday evening, there was no foreseeable end to the political stalemate.
“Numerous polling stations were closed, [and there was] violence here and there,” is how one adviser, originally from the UK, described the situation on Sunday, which he said he observed mainly on television from his Bangkok home.
“And I'm not even sure what the caretaker government hopes to gain, apart from some fresh legitimacy to carry on with its populist, and ruinous, rice-pledging scheme, and time to think up some more [populist schemes].
“The election certainly won't stop the protests, only intensify them, unless the government decides to crack down, thus bringing upon itself charges of suppression of democratic rights, which would in that instance be valid.
“Whatever else one might think of, or accuse him of, protest leader Suthep Thaugsuban’s insistence on reforms is spot-on and acted upon, might well change Thai politics, and politicians, as we know them,” the adviser, who requested anonymity, added.
For now, this adviser said, he is “not aware of any” of his clients planning to pull out of Thailand.
“But that doesn’t, of course, mean that they aren’t planning to.
“The impact, for me, has been the difficulty in meeting with some clients [as a result of the street demonstrations in and around Bangkok], and the difficulty with some clients who have been working on government projects, and are not getting paid.”
The "rice-pledging" scheme was a Thai government initiative that was aimed at supporting Thailand’s struggling farmers by purchasing their rice crop at higher-than-market rates. It has left the government with a massive government rice stockpile, which at some point it needs to unload on a thus-far-disinterested world market, and is one of a number of problems the government is struggling to deal with.
'Unlikely to resolve anything'
Paul Gambles, a co-founder of Bangkok-based MBMG Group, told Bloomberg Television’s Rishaad Salamat on Friday that the election, at that point two days away, was unlikely to resolve anything, and observed that Thailand was already showing signs of a major economic slowdown, after years of steady growth.
“It is now starting to have a very serious impact,” Gambles told Salamat, of the political turmoil.
“I first came to Thailand 20 years ago, and throughout that time, we’ve had a lot of political issues, with a lot of different personalities involved. But until the end of 2012, one thing we saw consistently was foreign buying of the Thailand stock market – we saw about 400bn baht [£1.86bn, $3bn] of net inflows. Since the start of 2013, half of that money has flowed back out again.
“That’s not all to do with the protests, but around THB100bn of that has been since the start of the protests at the beginning of November.”
Today, in an interview with CNBC, which reported that post-election trading in Thailand today showed something of a rebound from recent lows, Gambles acknowledged that "anything that suggests any kind of positive news, any kind of resolution, even temporary" was likely to result in some kind of "bounce in the market", even though "a lot of the long-term headwinds are still there".
In an email comment today, Gambles said it was still unclear to what extent Bangkok’s expat community was thinking about leaving the country. There had been an “exodus” after the 2010 troubles, he noted, “which continued until the 2011 floods, although that was reversed [by new arrivals] in 2012 and in the first half of 2013”.
A similar response is “probable” again, if not yet evident, Gambles believes.
Thailand has a major tourism industry in addition to being an important regional hub for multi-national companies as well as non-governmental organisations like the United Nations. The last few years of political unrest have not gone unnoticed by industry, and in the weeks and months since the anti-government demonstrations began in Bangkok last November , a growing number of company executives have expressed concerns about their ability to expand in the country, unless the unrest is resolved.
The unrest coincides with an outflow of money from emerging markets, blamed, at least in part, on the US cutting back on its programme of "quantitative easing", which is said to have contributed to the growth of the world's emerging markets since September 2012.
To view the interview of MBMG Group co-founder Paul Gambles with Bloomberg, click here.
To view his interview this morning with CNBC's Leslie Shaffer, click here.
