Thailand’s politicians “like to think of their country as the natural engine for growth in mainland South-East Asia”, says The Economist. “This year, it is acting as a brake.”
The five-month stand-off between the government and supporters of the opposition, whose violent protests eventually led to new elections that have just been annulled by the constitutional court, shows little sign of ending soon.
Ideally, says Capital Economics, the two parties would agree to respect the results of new elections, but “the threat of escalating violence has come back to the fore”. The ongoing political uncertainty means that the economic outlook continues to deteriorate.
Already, notes The Economist, the annual rate of GDP growth has been cut in half to 2.5%. Investment is down by 11%, consumer confidence hit a 12-year low. Tourism has fallen. Export growth has stalled.
A government attempt to beef up infrastructure through a $70bn spending spree has been put on hold indefinitely after a high court ruled it unconstitutional (the government had tried to borrow the cash through emergency legislation).
To cap it all, there is a severe drought in the north of the country. Thailand’s recurrent political turmoil has “become exhausting to watch”.