News / Asia

Thai PM Calls for Reconciliation

Smoke billows across Bangkok skyline [file photo]
Smoke billows across Bangkok skyline [file photo]

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Ron Corben

Thai Prime Minister Abhisit Vejjajiva has called for national reconciliation as the country begins counting the economic cost following an army crackdown on anti-government protests.

In a televised address, Prime Minister Abhisit Vejjajiva said Friday that Thailand faces major challenges in recovering from months of protests and the military crackdown that ended them.

"We recognize that as we move ahead there are huge challenges ahead of us, particularly the challenge of overcoming the divisions that have occurred in this country. Let me reassure you that the government will meet those challenges and overcome these difficulties," said Mr. Abhisit.

Protesters known as red shirts set more than 30 fires in Bangkok Wednesday as the military moved to close their camp in the city's center. Flames engulfed department stores, malls, banks and media outlets, causing more than $1 billion in damage. International ratings agencies say Thailand's credit rating is at risk unless long term political divisions are resolved.

Mr. Abhisit says he will revive a reconciliation plan that the protest leaders earlier rejected. The plan includes early elections as well as economic, social and constitutional reforms.

A key goal, he says, is to get the economy back on track.

Economists warn growth may be cut by up two percentage points this year, to about four percent.

The crackdown and subsequent rioting cost 52 lives over six days, bringing the toll to 77 deaths since the protests began in mid-March. Over 1,400 people were reported injured. Thousands of people have lost their jobs and thousands of businesses have seen sales collapse.

Satish Sehgal, a Bangkok publisher, says the violence will have a lasting economic impact.

"It's hurt the Thai economy - it's put Thailand back two to three years - tourism has been badly affected. It is sad, it's rather sad," said Sehgal.

Tourism accounts for six to seven percent of the economy and 15 percent of the workforce. Industry experts say because of the political crisis, about 13 million tourists will come this year, down from earlier forecasts of 16 million.

Nagesh Kumar, chief economist at the United Nations Economic and Social Commission for Asia and the Pacific, says foreign investment will also suffer.

"The image of the investment outlook might be affected unless the government is able to restore confidence quickly and demonstrate everything is in order," says Kumar. "It can be contained if the government is able to overcome and restore peace and demonstrate that it is all working very well."   

The political uncertainties have led some expatriates to relocate. Andrew Durieux is the president of the Australian Chamber of Commerce in Bangkok.

"A number of expats are continuing to move out over the last couple of months, and Shanghai, and Kuala Lumpur and Vietnam have probably been the biggest recipients of those skills sets," Durieux said. "So Thailand needs to something to attract those families back."

Thailand has faced four years of political uncertainty, since a military coup ousted Prime Minister Thaksin Shinawatra. His supporters, largely from the rural and urban poor, accuse the military and the nation's traditional elite of ignoring their concerns. Mr. Thaksin, who lives overseas, has called for talks between the protesters and the government and has sought to distance himself from the rioting.

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