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The aftermath of the 11 September attack in New York continued to distract Thais from local concerns. Prime Minister Thaksin initially affirmed neutrality, then supported the US. More divisions of views occurred between government leaders, until it was decided that only the Prime Minister and the Minister for Defence should comment. Public attention also focused on the use of the U-Tapao naval air base in the south by American jets, though Defence Minister Chavalit promised it would not be used to stage an attack on a third country.
Some five per cent of Thais are Muslims. Many live in the south, close to mainly Muslim Malaysia. These are also some of the poorest parts of the country with a legacy of separatism and local bombings. As some anti-war rallies were held in Bangkok by Thai Muslims and a boycott of American and British goods emerged, Thaksin sent his top Muslim politician, Wan Muhamad Nor Matha, the Transport and Communications Minister, south to soothe local fears. The government also explained its qualified support for the 'war on terrorism' to the Thai Muslim spiritual leader, the Chula Rajamontri, and to the Islamic Central Committee of Thailand.
The supreme commander, General Sampao Chusri, flagged a military request for 200 million baht for weapons purchases to counter international terrorists. The military also want to expand a draft national security bill into an anti-terrorism law. They have banned any inflammatory anti-Muslim comments on their network of television and radio stations, and invited Thai Muslim leaders to broadcast with the aim of educating Thais about Muslim beliefs.
The crisis has given Thaksin welcome relief from a closer examination of his domestic policies. The government is making little headway at reviving the economy and the vital tourism industry is struggling. He has stepped down as Education Minister in favour of Suwit Khunkitti, the third Minister in eight months. Education reform has stalled. Thaksin also has made repeated changes in top officials, notably at the Central Bank and Thai Airways, adding to the climate of uncertainty. Although Thaksin had promised to foster small business, he has not acted against the large foreign superstores, such as Tesco and Lotus, that have made major inroads into retailing. Yet his own telecom business will benefit from the passage on 12 October of a bill that limits foreign ownership and disadvantages his competitors. Thaksin also continues to interfere with the media to silence his critics.
These developments do not inspire confidence in the government.
WATCHPOINT: Will Thaksin be able to re-boot the economy at a time of looming international recession?
About our company:
AFG Venture Group is an Asia and Australia based corporate advisory and consulting firm with over 20 years experience in creating alliances, relationships and transactions in Australia, South East Asia and India; including a 15 year history of corporate and equities advisory in Australia, undertaking merger, acquisition, divestment, fund raising and consulting for private and public companies.
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