Monday, August 25, 2008

Thailand’s shaky coffers

Nakhonratchasima, Thailand — Thailand’s revered monarch, King Bhumibol Adulyadej, granted a royal audience to Bank of Thailand executives last week amid concern for the country’s coffers, which many experts have described as depleted to the point of bankruptcy. The same week, the Thai king was called the world’s richest royal by Forbes magazine – which was denied by the Thai government.

The audience was to allow the finance leaders an opportunity to present proceeds from the sale of commemorative banknotes in celebration of the king’s 80th birthday, but it also served as an opportunity to discuss domestic and international threats to Thailand’s economic stability. Facing decreased exports from a stronger baht and more competition from fellow ASEAN partners, Thailand’sf inances, like those of most other nations these days, are anything but solid.

Corruption by leading politicians has been a major factor. Former first lady Pojaman Shinawatra was found guilty of tax evasion to the tune of more than a quarter of a billion baht (US$7.3 million) and her husband, former Prime Minister Thaksin Shinawatra, is with her on the lam in London, seeking asylum. As they do so, some 76 billion baht ($US2.1 billion) of Thaksin’s assets in Thailand have been frozen and are likely to be seized permanently, despite his attempts through legal counsel in Thailand to intercept any government efforts at taking what he took.

And while the Thaitanic is sinking, current Prime Minister Samak Sundaravej fiddles with one megaproject proposal after another, throwing in for good measure several smaller projects costing merely tens of millions of dollars. One is the forced relocation of students from a century-old school and the demolition of the school to be replaced with a brand new parliament building. All this work and guess what? No budget has been allocated.

But lack of money seemingly never bothered Samak, nor does it seem to give him much concern now. The prime minister recently reneged on a 45-million-baht pledge to the monarchy on the occasion of the queen’s birthday on Thailand’s Mother’s Day, Aug. 12. Only seven days after he had set up what he promised would be a 116-day celebration for the king and queen, the equipment and pomp were already torn down and forgotten.

Samak blamed the redirection of public interest to nearby People’s Alliance for Democracy protests, but Samak himself has proven to be a huge disappointment, even to the king apparently. When Samak first promised to set up the celebrations, the king said, to paraphrase, “I hope you actually go through with it.”

While Thailand’s national bank is on shaky ground, its U.S. counterparts have been trying to draft a game plan to help save the United States and the rest of the world form what some say is an imminent recession, to be quickly followed by some sort of actual depression. Most pro-government experts are denying rumors of a depression – and not a few even deny seeing clouds in the financial skies – but are at a loss to come up with any concrete data that disproves either recession or depression.

All we hear is “A really huge bank is going to go bankrupt soon.” Who? JPMorgan Chase? The huge economic damage caused around the world by high oil prices and the destructive impact of two major wars going on in Afghanistan and Iraq, as well as corporate corruption and greed that have undermined the stock market and finances in general, all combine to cast a dark shadow over those of us who are subject to so-called market forces – but not, it seems, over those who created the laws and regulations they now hide behind and are protected by.


(Frank G. Anderson is the Thailand representative of American Citizens Abroad. He was a U.S. Peace Corps volunteer to Thailand from 1965-67, working in community development. A freelance writer and founder of northeast Thailand's first local English language newspaper, the Korat Post – -- he has spent over eight years in Thailand "embedded" with the local media. He has an MBA in information management and an associate degree in construction technology. ©Copyright Frank G. Anderson.)

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