Monday, January 15, 2007

Military Rule in Thailand

The military overthrew the elected Prime Minister Thaksin last September. Everyone seemed to agree it was a good thing; Thaksin was very wealthy from business in telecommunications before he was elected, but he could not understand that he was not elected to enrich his family and himself at the expense of Thailand's poor. Just one example: On Thursday 1/11/07 the Bangkok Post showed Thaksin's son Panthongtae Shinawatra appearing to testify about when he bought shares of Ample Rich Investments for one baht (Thai currency) when it was selling for 47.25 and sold it a few days later for 49.25 baht. His public statement "I just signed papers, ask mum's secretary." (The Thai baht is 35.3 per US dollar today.) But what do you get when the military rule? Heavy fisted rule as we can see in Thailand this week. Limit on foreign investment - protection that hurts the "protected" The ruling council was convinced that foreign investment was overwhelming Thai businesses, so all foreign investment must be matched by 30% in government bonds [correction]. As soon as they announced this policy they were talking about exceptions. I haven't kept track of the list over the 6 days we have been here. Today's Bangkok Post (1/16/07) says that the 30% rule will cost the Electricity Company 50 basis points on borrowing over the next 10 years. 50 basisi points is 5%. That's huge. Censorship This is real censorship - prior restraint of the press by the government - not the false kind often claimed in the US when the press chooses not to publish something. (It's OK when every day they decide to publish or broadcast one story but not another; that's editing.) Sunday, January 14 the government of Thailand asked for the cooperation of the the cable TV providers to block broadcast of a CNN interview of former Prime Minister Thaksin. The Bangkok Post reported on 1/16/07:
General Saprang Kalayanamitr, deputy Council for National Security (CNS) secretary-general said the generals had to give priority to national security.
After all, he might say something that would be negative about the ruling generals. The general calls that protecting national security. We know what Thaksin said because the Wall Street Journal Aisa reported it on the front page, also on 1/16/07. Thaksin said what I just reported above - the military government's restrictions on foreign investment is hurting Thailand's economic growth. Quoting WSJA: "Such moves, he said, are steering Thailand away from the free-market course on which he had been guiding the country. 'Whether we like it or not, we have to live under a capitalist system." ... "And to live in it successfully, we have to open up our economy and our society. Competition is unavoidable, so we have to preapre for it." My opinion: the people of Thailand can compete. They are bright and hard working. Again I apologize for omitting links to the stories: internet access in our hotel is very expensive.

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