Political risk will continue to weigh on business and market sentiment for the foreseeable future, according to local analysts.
''There is no signs of compromise in the current situation among Thais, who in the past have always been known for their compromising nature,'' said Supavud Saicheua, a managing director of Phatra Securities.
He said political and oil price risks would remain major issues for businesses over the near future.
Whereas in past decades, economic growth was able to be maintained despite political change, today's social conflicts are clearly undermining investor sentiment. The Stock Exchange of Thailand has fallen 18% since the beginning of the year, largely due to political uncertainties and rising inflation.
But Finance Minister Surapong Suebwonglee said he believed political risk had passed its most dangerous point.
Political stability first began to spiral downward in 2006, when the People's
Sentiment nosedived after the military coup on Sept 19 that year, while policy uncertainties undermined new infrastructure investments needed to spur growth.
''But today, I think we can see that political development can be accomplished within the democratic system. We have had [PAD] street protests for three months now, even longer than those in 2006, but things have remained peaceful,'' Dr Surapong said.
He ruled out a new coup and expressed confidence that political stability was improving.''I'm not saying that changes won't be made. But they will be made within the democratic system,'' said Dr Surapong, who also stands as secretary-general of the coalition-leading People Power Party.
He dismissed speculation that the government was planning to call for early elections, saying that it was intent on serving out a full four-year term.
Other projects, including an expansion of
Some 40 billion baht in funds would be invested in IT infrastructure and human resource training for the health-care sector, with other funds allocated to improve the country's education system, including new libraries and ''knowledge centres'' nationwide.
But Dr Supavud said the megaprojects were poorly prioritised, and argued that irrigation improvements should be a priority to help meet global demand for agricultural commodities.
A second priority should be the country's rail networks, to reduce logistics expenses for the business sector.
''But the government has set its first priority on mass transit. This should be third in my view,'' Dr Supavud said.
He warned that the