State of Emergency will hurt Thailand’s economic growth

April 13, 2009 11:34 pm 

BANGKOK, April 12 — The State of Emergency imposed in Bangkok and five neighboring provinces by Thai Prime Minister Abhisit Vejjajiva on Sunday will further deteriorate foreign investment and the country’s economic growth, experts said.

Thanawat Palavichai, director of the University of the Thai Chamber of Commerce (UTCC) Economic and Business Forecast Center, said he believed the government would issue new laws or decrees to contain political turmoil in the country.

Negotiations between protesters and the government to return to normalcy could be difficult to arrange, and it is possible that clashes between the parties could lead to political changes, he said.

It is highly likely that foreign investment through money and capital markets in Thailand will slow down, Mr. Thanawat said.

He said if political unrest could not be resolved soon, Thailand’s economic growth could contract more than 5 per cent this year while government-sponsored projects would also be delayed.

Santi Vilassakdanont, chairman of the Federation of Thai Industries (FTI), said he believed the government would not use violent measures against the protesters.

The State of Emergency if imposed for a short-term would affect tourist confidence and Thai economic growth this year may further contract despite the government’s newly-launched economic stimulus programs, said Mr. Santi.

The state of emergency is effective in Bangkok, Nonthaburi, Samut Prakan, Pathum Thani, Nakhon Pathom and Ayutthaya provinces due to a group of people inciting unrest, according to the government announcement. (PNA/TNA)

DCT/rsm

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