The protracted domestic
political impasse in Thailand already has impacted the country’s immediate
economic prospects. Now foreign
investors have expressed concerns that the difficulties will impact the
country’s ability to implement its ASEAN Economic Community (AEC) commitments,
beyond the 2015 implementation date.
For example, the
Thai Board of Investment, which approves projects, has been stymied since its
members’ terms expired last October.
The Thai Prime Minister, who serves as ex officio chair, cannot appoint new members due to her caretaker
status. Hence new projects cannot be
approved.
This and other delays
in AEC- related legislation and regulation was cited by the Joint Foreign
Chambers of Commerce in Thailand (JFCCT), in a report by the Nation:
"A number of specific changes to laws and procedures are required to ensure smooth implementation and to allow Thai companies and citizens to obtain the benefits envisioned. The current political situation, unclear outcome of elections, uncertainty of government functions and control issues raise significant concern in terms of decision making and implementation capabilities. Some changes will require a functioning parliament."
The JFCCT went on to note
specific AEC-related issues which require immediate attention:
“For
example, to allow the labour changes to work, the Thai labour law needs
amendment. A sitting parliament needs to do this. To allow the services changes
involving ASEAN national foreign ownership of up to 70%, the Foreign Business
Act and some other procedures need to be changed. Other changes needed include
a large effort to harmonize the many varied definitions, standards and
procedures. These include labelling, university qualifications, taxes, and
customs practices. The ministers of multiple departments and staff from many
ministries need to agree and implement these.”
Of
course, many of these issues were outstanding before the current political
crisis in Thailand. The
Thais were among those most anxious about increased competition arising from
the AEC, and so were already somewhat reluctant participants in the
process. The continuing political
impasse makes them even more so.
Without
a resolution, implementation of AEC and other ASEAN Community commitments by
Thailand becomes delayed even further.
Will this spur ASEAN to intervene directly? Very unlikely, given ASEAN’s principle of
non-intervention in domestic political matters,
as well the
current Thai leadership’s preference to seek assistance from the UN rather than
ASEAN. Nevertheless, the leaders of
Thai society need to be reminded of the short and long term negative effects to
the Thai economy, including AEC-related matters. Whether Thai leaders will
seriously consider these effects remains to be seen.
