Dec 24, 2007

Thailand Election Result: More Instability Ahead? And Why Should New Zealanders Be Interested?

It seems that the allies of deposed Thai PM Thaksin have done best in the Thai elections. But they have not achieved an absolute majority. To govern, a coalition partner will need to be found.

How is the Thai military going to react to this news. They deposed Thaksin a couple of years ago. Will they simply stand by and watch as Thaksin's people take back power, or will they put big pressure on smaller parties not to join a coalition with Thaksin's People Power Party? And how will the military react if a People Power Government allows Thaksin to return from exile?

Aside from being concerned about instability in a trading partner of growing importance (thanks partly to the FTA negotiated on goods trade three years ago) New Zealanders should be aware that an important negotiation between Thailand and New Zealand is pending. The negotiation of the services component of the FTA. The reason New Zealand went ahead an signed an FTA without services (services make up almost 70% of NZ's GDP and almost 30% of exports) was because the Thaksin Government was unwilling to open up the services regime, in which Thaksin and friends were major players, to further international competition. Will a People Power Government be anymore willing to open the services market in 2008?