4 Questions

There has been a lot of noise regarding the PM’s four questions last week post the bombing at the Phramongkutklao hospital where the military typically visits.

  • The first question asked whether people think the next elected government will ensure good governance.
  • The second question asked what should be done if there is no such government after the next election
  • The third question asked whether elections that fail to take into account matters relating to the country’s future, reforms, and national strategy are the right thing.
  • The fourth question asked if politicians who behave improperly should get a chance to run in elections again. He asked who will deal with them and how, if problems should occur again

You can take these questions from him with two viewpoints

The negatives

  • The military wants to postpone elections and continue their control over the country and that Thailand will likely not return to a democracy anytime soon.
  • He’s being hypocritical especially given the news of nepotism, the rather silly purchase of Chinese submarines (yes Thailand has to protect itself from the threat of Laos using the rivers to invade the country…)
  • The economy is slowing and will continue to slow under their leadership because face it a military government has no idea how a modern day economy works.
  • The citizens will never have their chance to vote, which after experiencing the rise of Thaksin, they will now feel it is their right to vote, if they aren’t careful this is will lead to another fight.
  • This would be the 3rd delay of promised elections.

The positives

  • The quality of politicians in Thailand is laughable and he’s right to ask whether or not there is good governance, given the fact that everyone knows that corruption is in the system, that the %age’s were ridiculously high, and very short term in nature. (side note: There are/have been a few decent ones)
  • One could argue that the populus was led to be afraid of what would happen when the former King passed away and that under military rule there would be a higher probability of a smooth succession versus under civilian government.
  • The rule of law is not properly followed in Thailand, this country does have every law that exists in the developed world however they just aren’t followed nor are the penalties given to those found guilty harsh enough (eh-hem drunk drivers of well to do families), but arguably under the military’s reign thus far there have been harsh penalties given to those caught doing corruption in the past 10 years with very hefty consequences (TAT, KTB).

So what’s the reality?
I still see the following timeline

  • 4Q17
    Cremation of King Rama IX
    Coronation of King Rama X
  • 1Q18
    Announcement of elections
  • 4Q18
    Elections held

The military does effectively control parliament for the next 5 years as per the vote held last year, the only case in which this wouldn’t be the case is if all the political parties somehow agreed to work together to form a coalition against the military, something which I put a very low probability. So despite all this noise I don’t see that this event changing much in the timeline to new elections.
13.45 mn people apply for welfare
During my travels in Europe this headline provided to me one of the biggest WTF moments I’ve experienced this year . For a country that has a population of ~70 mn to have nearly 20% of the population requiring welfare is a staggeringly high #. That is 13 mn people that earning less than 100,000 baht a year. It’s sad for a country size, with the economic growth seen over the past 2-3 decades to still have such a higher # of people living on effectively nothing. I hope one day that those deciding upon the path of Thailand’s development will realise that having a country having demonstrating the ability for people to improve their earning power, education, access to healthcare will benefit everyone.

Source: Bangkok Post

A new sugar trading system
The one positive thing that Thailand has is the agricultural sector and that the country has done a decent job in ensuring that there is enough food kept within the country to feed people. Now there are changes within the sugar trading system, one that has been in place for the past 3 decades, which are as follows:

  • Thailand agreed with the WTO to revoke its quota system, known as Quota A, for 2.2-2.5 million tonnes a year to secure sugar supply at home, after it was challenged by Brazil, the world’s biggest sugar exporter.
  • As sugar is a key commodity that could directly affect the country’s food prices and inflation, the government has been pegging the retail price of white sugar at 22.50 baht per kg for years.
  • To revoke the fixed price system, the OCSB will calculate a benchmark price to be announced every month based on London white sugar futures prices, which sets the global trend of grade white sugar consumption.

What does this mean?
The sugar co’s will be more correlated to the international sugar prices.

It hasn’t been in the news much but TCC Group bought out shareholders in three of its property funds, Thai Commercial Investment Freehold and Leasehold Fund (TCIF), Thai Retail Investment Fund (TRIF) and Thai Hotel Investment Freehold and Leasehold Property Fund (THIF). Naturally this has all been passed despite the IFAs opining that the unitholders should not approve the asset disposal transaction to AW because the offering price to purchase assets is lower than the fair value and it’s the sale of potential assets without a competitive bidding in a short consideration period.
Now don’t be surprised to see TCC repackage all of these assets into a REIT to list again next year, probably to fund the One Bangkok project.

  1. Fact that junta will effectively control the parliament for next 5 years is well known to the PM. Still he asks such rehetoric questions from the public which has little say or powers to make any changes in the governance of the country. Is he saying the constitution he wrote is not good enough? Or some firework, which appears to be shame him, can derail road to the Democracy. I have my doubts on election in 4Q18

    • Of course the constitution is not good enough, they only stipulated 5 years of control instead of the 50 they may have initially wanted, someone must’ve forgotten to add that zero…

  2. Regardless of which branch of the nomenklatura is in charge, dysfunction rules–as any traveller with waterwings on the streets of Bangkok can attest. Since the last flooding in 2011 (aside from incentivisations associated with “interim measures”), what steps have been taken in flood control? And who are the SVI’s and ROJANA’s lurking in this market now? Six years is a long time in hydraulics: in 1953, the Netherlands was flooded out; by 1959, six years later, it was controlled. The saddest thing of all: 25 years ago, the Dutch would have designed a comprehensive flood control scheme for the entire kingdom–at cost, possibly even gratis.


    It is still raining hard upcountry.

    • Thailand could still ask for help from the experts but that would be admitting failure and shock horror loss of face, meanwhile the rest of world is already laughing at all this ineptitude by the boys in charge,

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