Thai Protesters May Face Test of Support as Abhisit Signals Early Election
Thai Prime Minister Abhisit Vejjajiva signaled he may call an election as early as April, undercutting street protests that have limited gains in the country’s stocks and currency as he seeks to remain in office.
Lawmakers may approve constitutional changes next month that Abhisit set as a condition for calling the contest, he told reporters yesterday in Bangkok. Asked whether he will dissolve the House of Representatives in April to trigger a vote, he said: “It’s possible, it’s possible.”
“The political risks provide a discount, while the country’s economic fundamentals are solid,” said Masahiko Ejiri, a Tokyo-based senior fund manager at Mizuho Asset Management Co., which oversees the equivalent of $41 billion. “It’s not a market we want to sell,” he said, adding that Thai banks and energy firms, such as PTT Plc and Banpu Pcl, looked attractive.
An election would test public support for yellow-shirted protesters currently blocking a Bangkok street, who backed Abhisit’s rise to power in 2008 and now say the government is ceding territory to Cambodia. It would also meet a demand of rival red-clad supporters of ex-leader Thaksin Shinawatra, whose occupation of downtown Bangkok to press for an immediate election last year led to at least 95 deaths.
Leaders of the People’s Alliance for Democracy, who mobilized tens of thousands of protesters when they seized Bangkok’s airports 26 months ago, say they won’t move until Abhisit meets their demands. About 2,500 protesters have joined the latest demonstration to pressure the government to drop out of the United Nations’ World Heritage Committee, cancel a border-negotiation agreement and urge Cambodians to withdraw from disputed border areas.
Calling an election would be tantamount to “avoiding the problem,” Parnthep Pourpongpan, a People’s Alliance spokesman, said on Bloomberg Television today. “We request the government to do its duty,” he said. “It’s a protest for the nation, for the territory, for the motherland.”
Deputy Prime Minister Suthep Thaugsuban offered today to facilitate negotiations between the protesters and Abhisit. He dismissed rumors that soldiers might stage a coup, a feat they’ve pulled off 10 times since 1932, most recently when Thaksin was ousted in 2006.
“As far as I know the army chief has a democratic mind,” Suthep said. “If there will be a change in our country, it should be in line with democracy.”
Lawmakers should pass two constitutional amendments on Feb. 11 to alter the composition of Parliament and make it easier to sign international treaties, Abhisit said. The changes would take effect in either late February or early March, he said.
Thailand’s benchmark SET Index gained 0.4 percent as of 10:08 a.m. local time. The gauge lost 4.3 percent on Jan. 24, its largest drop in 15 months, after protesters announced plans for an indefinite stay on Bangkok’s streets. Thai stocks were valued at 11.6 times estimated 2011 earnings, the fourth-lowest in Asia after Pakistan, South Korea and Vietnam, according to data compiled by Bloomberg.
The Bank of Thailand needs to boost borrowing costs again to damp quickening inflation and may use capital controls if needed, central bank Governor Prasarn Trairatvorakul told reporters in Bangkok yesterday.
“We hope that the elections will happen smoothly and the result will be accepted,” Prasarn said. “If things turn out that way, the political factor may turn from a negative to a positive for the economy.”
Thai lawmakers this week approved a proposal from Abhisit’s Democrat party to increase the number of party-list seats to 125 from 100, and boost the total number of lawmakers to 500 from 480. In the 2007 election, the Democrat party finished with 68 fewer total seats than the pro-Thaksin party after winning the most party-list votes.
Abhisit took power in a December 2008 parliamentary vote when a faction of pro-Thaksin lawmakers defected to switch the balance of power. The appointment came two weeks after a court disbanded the pro-Thaksin ruling party, a move that coincided with the seizure of Bangkok’s airports by the People’s Alliance.
In 2008, the military refused orders from a Thaksin-linked prime minister to disperse the group. Commanders have twice followed Abhisit’s orders since then to disperse pro-Thaksin protesters, support that remains strong, said Michael Montesano, a visiting research fellow at the Institute of Southeast Asia Studies in Singapore.
“Abhisit ultimately depends on his backers in the other political parties, his own political party, the military and the palace,” he said. “There’s no sign that support in these areas has diminished for Abhisit.”
Pro-Thaksin parties have won the past four elections on a platform of improved health care and cheap loans. Abhisit’s Democrat party has sought to woo those voters with programs to refinance loans, guarantee crop prices and give cash to the elderly in a bid to win the most seats in a nationwide vote for the first time since 1992.
“Politics is probably more stable than it’s been in a long time,” said Andrew Stotz, Bangkok-based strategist with Kim Eng Securities (Thailand) Pcl, the country’s biggest brokerage. The country is moving back to an era “where politics goes up and down but business can get on with things,” he said.
To contact the reporter on this story: Daniel Ten Kate in Bangkok at email@example.com