BBC News: Thais wonder at coup aftermath

Thais wonder at coup aftermath
By Kate McGeown
BBC News, Bangkok

So far the coup has been peaceful
Thailand has been in political limbo for months, but the events of Tuesday night still took everyone by surprise.

"What happened last night took me by surprise," admitted Giles Ungpakorn, a political commentator at Bangkok's Chulalongkorn University. "There had been rumours, yes, but there had been rumours about many things recently."

There is no doubt that something needed to be done.

Since a general election in April was annulled as undemocratic, Thailand has been run by a caretaker administration, and has been struggling to get back to normal.

As time ticked by, Thaksin Shinawatra's position as prime minister was increasingly being questioned.

In fact, just last week army chief General Sonthi Boonyaratglin said in a statement that the military would not stage a coup.

But a week is a very long time in current Thai politics, and it was General Sonthi himself who led the move to oust the prime minister on Tuesday evening.


It took a lot of time and effort to make the last constitution, and that's just been thrown in the wastepaper bin

Pasuk Pongpaijitr

Although details are still sketchy, it is now apparent that the military had split into two factions, one loyal to Mr Sonthi and the other loyal to Mr Thaksin.

Without a single shot being fired, Mr Sonthi's side triumphed, taking over Government House and national broadcasting networks in a well-organised operation, and accusing Mr Thaksin of causing an "unprecedented rift in society".

The coup leaders also accused Mr Thaksin of harming the dignity of Thailand's highly revered king, which many in the military would have seen as tantamount to treason.

According to Pasuk Pongpaijitr, the author of several books on Thai politics, the pro-Thaksin soldiers are now keeping a low profile.

"They were resisting at first," she said, "but they are being quiet at the moment, as people close to Thaksin are being arrested."

Analysts will now be watching very closely to see if and how these pro-Thaksin groups decide to respond.

Constitutional doubts

The people of Bangkok largely seem to have welcomed the night's developments. Some are even going onto the streets to bring presents to the soldiers and take their photographs.


People will be wondering what the coup leaders will do about Thaksin's policies

Giles Ungpakorn

"To many people here, it's a breath of fresh air. They hated Thaksin," said Dr Pasuk.

But she said the military coup was a worrying development in a country which had prided itself on being one of the most democratic in South East Asia.

"The problems over Thaksin had to be addressed, but I don't like the way it happened. It took a lot of time and effort to make the last constitution, and that's just been thrown in the wastepaper bin," she said.

"If the prime minister has done something wrong, I'd rather see him tried legally in the courts than be overthrown like this."

Many people in rural Thailand are also likely to be frustrated by the turn of events. Mr Thaksin is popular among poorer farming communities, for initiatives such as a low-cost health scheme and rural loans.

"I think these people will be wondering what the coup leaders will do about Thaksin's policies. The new government will have to give them answers on that soon," said Mr Ungpakorn.

According to local media professional Kittipong Soonprasert, pro-Thaksin political leaders in rural areas are likely to be assessing their options over the next few days.

"They need time to decide what to do - and they know they're being watched," he said.

"Martial law is in place, so I think that although they might well want to take a stand, I don't think it will be now," he said.

King's role

The question of whether there is a backlash from the rural poor - or indeed from senior aides close to Mr Thaksin - is just one of many issues which are still far from clear.

The long-term intentions of the coup leaders also seem uncertain.

Many analysts are drawing parallels with the last military coup in 1991, when General Suchinda Kraprayoon toppled a civilian government in a bloodless takeover, putting the military back in power.

General Sonthi has promised to restore democracy as soon as possible, but Giles Unprakorn has his doubts.

"People are claiming Sonthi is a reformist, but in reality he is similar to Suchinda," he said.

According to Dr Pasuk, though, the situation is different this time.

"In 1991, the military wanted to come back to power and replace the elected government. There will be huge pressure to stop them doing that this time round," she said.

Ultimately, the outcome may well be decided by the actions of King Bhumibol Adulyadej.

So far the palace has not commented on this crisis, but in the past the king's interventions have immediately calmed the situation, such is his influence throughout the country.

In the meantime there is little the Thai people can do but wait and see how this drama unfolds.

The coup leaders have declared Wednesday a public holiday in Thailand, closing schools, banks and government offices.

Usually, public holidays are a time for celebration. But right now there is just a palpable sense of unease, as Thai people try to digest what has happened in the last 24 hours, and speculate on what happens next.

What next for Thaksin Shinawatra?

Mr Thaksin is reportedly planning to fly to London
Thai Prime Minister Thaksin Shinawatra was in New York to deliver a speech to the UN when news came in that he had been overthrown in a military coup.
He initially phoned a Thai television station to declare a state of emergency, but was cut off after 10 minutes.

His speech to the General Assembly, scheduled for Wednesday, was brought forward to Tuesday evening before being cancelled altogether.


The billionaire businessman-turned-politician has not been heard from since, although he is expected to fly into London later on Wednesday.

It would be difficult to Thaksin to come back quickly, but there's always a possibility he'll return one day

Dr Pasuk Pongpaijitr
Thai political economist

As phone networks went down in Thailand, Mr Thaksin was reported to be able to do little but watch events unfold from a TV set in his room at the plush Grand Hyatt hotel.

"It is very difficult to communicate with people, to get to know the exact situation here," one official was quoted by the AFP news agency as saying.

Another said Mr Thaksin was "calm" and had watched US President Bush's speech to the General Assembly from his hotel room.

Family wealth

Mr Thaksin was initially reported to have chartered a Russian plane to fly him to London, where he has a home and where one of his daughters is a student.

A reporter travelling with him said he had boarded a chartered Thai Airways flight at New York's John F Kennedy bound for London at 0900 GMT.

The UK foreign office said he was free to travel to Britain "on a private basis" and said he does so often as he has relatives in the country.

His wife is reported to have travelled from Thailand to Singapore on Monday night. It is not know where his son and other daughter are.

Thailand's coup leader General Sonthi Boonyaratglin has said Mr Thaksin may return to the country, but warned that he could face criminal charges.

He refused to be drawn on whether the military would seize Mr Thaksin's considerable assets in Thailand, saying only: "Everything will comply with the law. Anybody who has committed a wrongdoing must be held responsible."

The sale of Mr Thaksin's stake in the telecoms firm he founded, Shin Corp, to Singapore investors at the beginning of the year led to the current political crisis.

Many Thais were enraged that the family had sold off a national asset, and had not paid tax on the $1.9bn deal.

But while support for him has dropped in Thailand's urban areas, Mr Thaksin retains support in the countryside.

Thai political economist Dr Pasuk Pongpaijitr says it may be difficult for the ousted leader to return in the short term, "but there's always a possibility he'll return one day".

"Having a lot of money means he definitely has options," she adds.

It remains to be seen whether Mr Thaksin, who has played such a big part in both the political and business life of Thailand, will settle for a life in exile.

World reaction to Thailand coup
Leading international figures react to the announcement by the Thai military that they have overthrown Prime Minister Thaksin Shinawatra.


EU FINNISH PRESIDENCY STATEMENT
The current president of the EU expresses grave concern over the events that have taken place tonight in Bangkok.

It is highly regrettable that democratic institutions seem to have been taken over by military force. Prime Minister Vanhanen emphasises the need to revert to democratic order without delay.




US ENVOY TO THE UN JOHN BOLTON
I think we have made it clear that we expect constitutional processes to be followed.



UN SECRETARY GENERAL KOFI ANNAN
This is not a practice to be encouraged. We, as an organisation, have always supported governmental changes through democratic means, through the ballot box...

All I will say is that they should remain calm. Over the past decade or so, they have established a solid democracy and institutions under the leadership of the king. I am sure they will be able to restore that institution and go back to a democratic system as soon as possible.



AUSTRALIAN FOREIGN MINISTER ALEXANDER DOWNER
We deeply regret the fact that such a coup has taken place. Obviously, to see democracy destroyed in that way is a matter for grave concern to us.



NEW ZEALAND PRIME MINISTER HELEN CLARK
New Zealand condemns any process which seeks to overturn a government by unconstitutional and undemocratic means.

New Zealand urges all political and military players to resolve their differences peacefully, and to act in accordance with Thailand's constitution and democratic principles.



JAPANESE FOREIGN MINISTER TARO ASO
Our country will closely watch the progress of the situation with grave interest.

Our country strongly hopes that the situation will become normal and a democratic political structure will be restored swiftly.



MALAYSIAN PRIME MINISTER ABDULLAH AHMAD BADAWI
I am really shocked, I didn't expect a coup would have taken place in Thailand.



INDONESIA FOREIGN MINISTRY STATEMENT
As a fellow member of the Association of Southeast Asian Nations (Asean), the government of Indonesia expects that the principles of democracy, which is an important element of the Asean community thus agreed upon by all member states, would be further upheld.

The Government of the Republic of Indonesia further hopes that the political crisis in Thailand could be resolved amicably and democratically for the greater interest of the people of Thailand.

Soldiers greeted with flowers on streets of Bangkok
By Andrew Drummond, for The Times, in Bangkok, and Jenny Booth

Soldiers who took over Bangkok in last nightтАЩs military coup were today greeted with flowers as the city woke up not in fear but more in a holiday mood, despite the presence of tanks on the street of the capital.

The city had a Sunday morning atmosphere, while troops loyal to Lieutenant-General Sonthi Boonyaratglin, the Army Commander-in-Chief, did little to interfere with everyday life. Yellow ribbons signalling loyalty to the Thai king were tied to their tank turrets and rifle barrels.

Bangkok residents joined in the public holiday which had been ordered to all bank and government staff and schools.

It was rumoured that the General is preparing to install Pridiyathorn Devakul, the Governor of the Bank of Thailand, as caretaker Prime Minister.

Mr Pridyathorn, who is in Singapore at the meeting of the World Bank, is officially denying the reports. "No one has approached or called me about the post. You all should not listen to rumours," he said at a press conference.

At 9.10am local time today Lieutenant-General Sondhi went on air to announce his intentions to Thailand. Flanked by officers from the Army, Navy, Air Force and Police in an evident show of solidarity, and seated in front of portraits of ThailandтАЩs King and Queen, he repeated that he had installed martial law, shut down the government and suspended the constitution in order to heal the country.

He said that he himself would act as prime minister for two weeks, until a new leader "who is neutral and upholds democracy" is found.

Then, the new government would hold on to power for no more than a year, and general elections would be held in October 2007, he promised. There would be no change to Thailand's foreign policy or tinkering with international agreements.

"We have two weeks. After two weeks, we will step out," Lieutenant-General Sonthi told a news conference. "We do not want to control this country. We want Thai people to love each other. We want people to keep calm.

"I am the one who decided to stage the coup. No one supported me," he said, referring to ThailandтАЩs revered King Bhumibol Adulyadej.

"I would like to assure that the Political Reform Council has no intention of running the country by itself and will return power, under the constitutional monarchy, to the people as soon as possible. The Thaksin government has divided the country and has stopped freedom of the ordinary people and independent organisations."

General Sondhi said that Mr Thaksin was mainly interested inтАШ helping his own peopleтАЩ. He also accused him of coming close to insulting the King. "If we let him continue to do that Thailand would get worse and worse." He added that Mr Thaksin was welcome to return to his homeland but could face criminal charges.

Mr Thaksin, who last night from New York impotently ordered the General to surrender himself to the Office of the Prime Minister and declared his own state of emergency, was this morning rumoured to be planning to fly to London, where he has property.

The Prime Minister, a former policeman turned billionaire entrepreneur whose business tentacles have penetrated many areas of public life, has been the countryтАЩs most popular and at the same time most hated Prime Minister. A feared counter-coup from forces loyal to him has so far failed to materialise.

Thailand's land borders with Laos and Myanmar have been closed.

Meanwhile the military leaders had meeting with academics, top civil servants and foreign ambassadors to explain the new deal.

Censorship has been imposed on the media banning negative reporting of events and there were few supporters of Thaksin Shinawatra, the ousted Prime Minister, giving television interviews. BBC and CNN were still off air in Bangkok.

There were reports that members of Mr ThaksinтАЩs Government, including his Deputy Prime Minister, Chitchai Wannasathit, and the Defence Minister, Thammarak Isaragura na Ayuthaya, had been arrested by the military and had resigned.

The coup has been condemned internationally as anti-democratic. The European Union issued a statement demanding the return of "the democratically elected political government".

Margaret Beckett, the British Foreign Secretary, said: "We are never happy about military attempts to overturn a government, if that is what is happening. We hope there will be peace."

Dramatic events began to unfold early yesterday when at 8.00am Thai time Mr Thaksin, sensing a whiff of treachery, ordered an urgent teleconference with all armed forcesтАЩ commanders. His suspicions were confirmed when no-one attended.

In the early evening Special Forces troops started moving the 100 miles south from Lopburi to Bangkok, and by 9pm they began taking up positions along with the 1st Infantry Division at key locations in Bangkok, including Government House, various Ministries and Mr ThaksinтАЩs private home.

At 9.30pm the Army took control of Channel 5 television station, which started playing patriotic films of the King Bhumibol Adulyadej, the worldтАЩs longest serving monarch, accompanied by royal songs.

One song in English was broadcast repeatedly: "The greatest King of Kings in all our time, Heavenly gift to all mankind, as his fame will forever remain.

"He is the son the moon and the stars to his people near and far, Millions of others cannot compare, Our greatest King, King Bhumibol."

Meanwhile the Thai News Agency reported that Mr Thaksin would return from the United Nations General Assembly in New York to Bangkok tomorrow, a day early. Mr Thaksin managed to put in a call to Channel 9 television in Bangkok. In the broadcast he ordered General Sondhi to report to the Deputy Prime Minister and he declared a state of emergency. He was cut off mid-sentence.

By 11 pm the coup was a fait accompli. The new тАШPolitical Reform CouncilтАЩ issued a statement saying that the armed forces and national police had peacefully seized control of Bangkok and surrounding areas.

Giving further details in a second statement at 11.50 pm the ARC cited national disunity and rampant corruption as reasons for the coup, adding that it planned to return power quickly to the people.

By 1am the ARC had nullified parliament, the constitution, the caretaker Cabinet and the Constitutional Court. It issued an edict banning political gatherings of more than five people.

In urban Thailand analysts reported a feeling of euphoria in large sectors of society. City voters have questioned whether Mr Thaksin's landslide electoral victories - delivered mainly with the backing of countryside voters, encouraged by subsidies for rural business - actually espoused democratic principles, with some condemning him as a greedy Chinese businessman.

He was widely criticised for pocketing ┬г1.1 billion tax free after selling his satellite and mobile phone company to Singapore - shortly after condemning businessmen for selling out to foreigners. His companies have a record of getting favourable government contracts.

Since he has been in power he has been accused of stifling the press, enriching himself at the publicтАЩs expense, and instigating a war on drugs in which some 2,500 people died, many innocently at the hand of police. His opponents say he lied to the world about the presence of bird flu in Thailand, and has failed to deal with an Islamic insurgency in southern Thailand.

His populist policies included a health scheme for the poor, loans for farmers, and attempt to buy Liverpool Football club.

Many were waiting for a statement from the King. None is expected soon and any royal statement is likely to request a quick return to democracy.

As threats of a counter-coup failed to materialise it seems this latest coup, the first in 15 years, had ended bloodlessly with just a few of the PMтАЩs allies in custody for their own тАШsafekeepingтАЩ.

English backpackers in the Banglampoo area of Bangkok, near the Royal Palace, spent a sleepless night nonetheless.

Nicole Sullivan, Jenny Gaskin, Laura Prendergast, all aged 22, students in Media studies at the University of Westminster, Harrow campus, arrived in Thailand last night from New Zealand as the coup was in progress. They became scared after finding most guesthouses either full or shuttered up.

Miss Sullivan said: "All the way from the airport there were military vehicles. When we got to Banglampoo we were told there was a coup on. We didnтАЩt panic. ItтАЩs not British, but we were concerned. We knew a lot of people had been killed in the last coup in Thailand."

Miss Prendergast added: "We had difficulty sleeping after we eventually found a room. Every noise I heard I thought it was the military coming. But when we woke up today everything was fine. Shops and restaurants were opening as usual. The tanks are just like another sight to see."

ThailandтАЩs financial markets were closed after the coup. Regional stock markets also wavered, though the political crisis was only one negative factor amid weakness on Wall Street on poor house building data and a profits warning from internet company Yahoo!.

Thai coup as generals seize power in Bangkok
By Richard Lloyd Parry, Asia Editor


Richard Lloyd Parry's Weblog
TANKS and armed soldiers were enforcing martial law on the streets of Bangkok this morning after the Thai Army launched a lightning coup against Thaksin Shinawatra, the Prime Minister, while he was attending the UN General Assembly in New York.


An army statement said that its commander, Lieutenant-General Sondhi Boonyaratglin, had taken control of the country, and claimed that he was in consultations with the king, Bhumibol Adulyadej.

The coup was the climax of a year of political unrest surrounding Mr Thaksin, a bitterly divisive figure who has won three election victories, but provoked the contempt and hatred of many urban, middle-class Thais. Vast crowds of demonstrators have rallied in Bangkok calling for his resignation, and at various moments there have been wild rumours of imminent coups. But last nightтАЩs events came out of the blue.

The turmoil raised fears over economic stability in Thailand, which less than a decade ago sparked the Asian financial crisis. The Thai baht weakened slightly yesterday as some nervous investors moved their money into the safety of the dollar, but there was no sign of the financial panic which dragged down the whole region in 1997.

Tens of thousands of Britons, including about 2,000 holidaymakers, are currently in Thailand. They were advised by the Foreign Office to avoid large crowds and demonstrations.

In a televised statement, General Sondhi said that the military had seized power temporarily, and suspended the constitution, but that sovereignty would be тАЬreturned to the Thai people as soon as possibleтАЭ. He ordered all troops to report to their stations and not leave without permission from their commanders.

The general, a Muslim in a predominantly Buddhist country, who is believed to be close to the king, that the coup was necessary because тАЬthe democratically elected government had caused unprecedented division in Thai societyтАЭ. There were reports that members of Mr ThaksinтАЩs Government, including his Deputy Prime Minister, Chitchai Wannasathit, and the Defence Minister, Thammarak Isaragura na Ayuthaya, had been arrested by the military, and had resigned. тАЬThe Government is no longer administering the country,тАЭ Colonel Akara Chitroj, an army spokesman, said. тАЬI think Mr Thaksin will not return to Thailand for the time being.тАЭ

But in New York, Mr Thaksin insisted that he remained Prime Minister. Spokesmen said that he remained calm although his planned address to the General Assembly on the situation was cancelled. тАЬSome of the military officials came out and tried to make a coup attempt but we confirmed that they cannot succeed,тАЭ Surapong Suebwonglee, a government spokesman, said. тАЬNow weтАЩre in control.тАЭ

In Bangkok, loudspeakers mounted in tanks urged people to return home but, despite unconfirmed reports of shooting, there appeared to have been no bloodshed. Tourist bars and hotels a few miles from the centre of the coup were unaffected.

Thai television broadcast a message from Mr Thaksin announcing that General Sondhi was to hand over his command to Mr Chitchai, and instituting a state of emergency. Regular television programmes were then replaced by images of the Royal Family and patriotic songs.

Some 14 tanks took up positions in front of Mr ThaksinтАЩs offices in Government House and the nearby Royal Palace.

Coups used to occur every few years in Thailand, but this is the first for 15 years and the first use of military force in political disputes since 200 people were killed when troops opened fire on anti-government demonstrators in 1992. In that time, democratic elections appeared to have become firmly established although that stability has been undermined by the bitterly divided attitudes to Mr Thaksin.

Thailand is home to 45,000 British passport holders. A Foreign Office spokeswoman said that although there are only 20,000 registered Britons in the country, mainly expatriates, many more are visiting and reside there. Thailand attracts 750,000 British tourists every year, although the peak season is not until December.

The Foreign Office advised people about to travel to look out for the latest information before setting off. A notice on its website also instructed tourists to restrict movements around government buildings and in public until the situation becomes clearer.

The spokeswoman added: тАЬIf anyone is concerned about a relative in Thailand, they should contact them directly, because communications are still operating normally.

тАЬWe are monitoring the situation closely and will update our site as and when a clear picture emerges.тАЭ

A spokeswoman for Thomson, BritainтАЩs largest holiday operator, said that it was not running any charter holidays to Thailand until the winter, but that there were 194 holidaymakers in the country on tailormade packages.

British companies were monitoring developments. Tesco, Boots, Marks & Spencer and Cadbury Schweppes are among operating in the country.

Thailand is TescoтАЩs third largest market, after South Korea and Britain, generating sales of just under ┬г1 billion last year. It has a 200-strong chain of stores and is planning to open a further 170 there this year.


For the latest Foreign Office advice, go to www.fco.gov.uk (http://www.fco.gov.uk) and click on Travel Advice

Thai army chief couldn't kick coup habit
Wed Sep 20, 2006 06:03 AM ET

By Ed Cropley
BANGKOK (Reuters) - Throughout months of political stalemate, Thai army commander Sonthi Boonyaratglin swore the military had moved on from its days of meddling in government.

But having broken the mould as the first Muslim military chief in an overwhelmingly Buddhist country, the decorated Vietnam War veteran demonstrated that some habits are just too tough to kick.

With Prime Minister Thaksin Shinawatra at the United Nations in New York, Sonthi and his counterparts in the navy, air force and police carried out Thailand's 18th military coup in 74 years of on-off democracy.

Flanked by the heads of the other branches of the military and the police, the stocky 59-year-old appeared on national television on Wednesday morning to announce the formation of a 'Council of Political Reform'.

"The Council has no intention to run the country by ourselves and will return power, under the constitutional monarchy, to the people as soon as possible," he said.

Whatever the long-term outcome, the move was a major about-turn for Sonthi, who took up the position as army commander-in-chief a year ago, painting himself as a modern, professional soldier who shunned interference in politics.

"Don't worry about coups," the former special forces officer told reporters in November as speculation mounted about a military move to resolve a looming political stalemate stemming from a Bangkok street campaign against Thaksin.

"The country needs a strong economy, society and stable government. Coups will ruin the country," he said.

However, as the crisis deepened with an inconclusive and then annulled election in April, his frustrations -- and unswerving loyalty to King Bhumibol Adulyadej -- started to emerge.

"The country's problem, which originated some time ago and which has prevailed until now, has saddened His Majesty, which has upset and worried me," he was quoted as saying in a Thai paper.

"As a soldier of His Majesty, I would like to help him relieve his worry and the Army would adhere strictly to whatever advice he gives us," he said.

WORDS OVER WEAPONS?

Analysts said the promotion of a Muslim to head of the army appeared to be a deliberate attempt to resolve a separatist insurgency in Thailand's Malay-majority far south, where more than 1,700 people have died in 2- years of violence.

However, the native of central Thailand rejected the notion, saying he had been appointed purely on his track record.

"I'd rather use the mouth and negotiations than weapons to fight the insurgency," he said on his appointment, which was expected to last for two years before his retirement at the age of 60, as is standard in the Thai military.

Last week, he organised a peace rally in the south and opened the door to potential negotiations with the still unknown leaders of the insurgency -- a stance that put him at direct loggerheads with his political masters.

Perhaps sensing rumblings within the ranks, Thaksin made sure Sonthi was at his side when he made a surprise trip at the start of August to see leaders of the military junta in neighbouring Myanmar.

Last week, Sonthi returned alone to the generals' new jungle stronghold in the heart of the former Burma, although insisted on his departure for the three-day visit he was going only to forge closer military ties.

Wait and see for Thai tourist sector
By Will Smale
Business reporter, BBC News

Travel firms are telling tourists not to photograph Thai tanks
As tanks continue to fill the streets of Bangkok, UK tourists appear to be going about their holidays relatively unaffected.

Tour operators say they have no plans to cancel flights to Thailand, and UK holiday companies insist that "it's very much business as usual".

With tourism being such a key component of the Thai economy - attracting 15 million overseas visitors last year and contributing more than 6% of the national economy - this will be welcome news for the many Thais who rely on the sector for their livelihoods.

We have a flight going out to Thailand from the UK today and everyone due to travel will be doing so

Thomson spokeswoman

Yet while both the UK and German governments are still saying it is safe for their nationals to travel to Thailand, other nations, such as Australia and New Zealand are currently urging their citizens to stay away.

Whether the coup knocks Thailand's tourist industry to the same extent as the immediate aftermath of 2004's tsunami appears to rest on how the political impasse continues to develop, most notably whether things turn violent.

Quiet season

While it is fair to say that coups are never good news for a country's holiday industry, this one has at least come at a convenient time of the year for the Thai tourist sector - it is currently the quiet season.

For that reason the UK's Foreign Office currently estimates that 2,000 Britons are on holiday in Thailand, way below the 8,000-to-9,000 on any one day during the peak November-to-February period, when temperatures are cooler and there is less rain.

And the great majority of UK holidaymakers visit the main beach resorts and islands in the south of the country, many hundreds of miles away from the ongoing situation in Bangkok.

"It's very much business as usual, with flights to and from Thailand continuing as normal," says Keith Betton, head of corporate affairs at the Association of British Travel Agents.

"It's really only Britons who are in the centre of Bangkok who are likely to be affected by the coup.

"These people will need to be aware of what's going on and should not, for example, take pictures of the military."

Holiday firm Thomson, which currently has around 200 Britons in Thailand, agrees.

"All our people out there are fine," says a Thomson spokeswoman. "Most are in coastal resorts."

She added: "We have a flight going out to Thailand from the UK today and everyone due to travel will be doing so."

In Germany, the country's main airline Lufthansa said all flights to Bangkok were continuing as normal.

'Avoid demonstrations'

Yet despite the relative calm of British and German authorities and holiday companies, their Australian and New Zealand counterparts are being much more cautious.


Thailand's main tourism region is way to the south of Bangkok

The Australian government has told its citizens - be they holidaymakers or business people - to avoid all unnecessary trips to Thailand until the political situation is clarified.

By contrast, the UK Foreign Office is simply warning Britons in Thailand to stay on their guard and be sensible.

"If you intend to travel to, or are currently in, Thailand, you should monitor all available information on the local situation and keep in contact with your tour operator," it says.

"You should also avoid any demonstrations and large crowds.

"Movements around government buildings in Bangkok and in public may be restricted until the situation becomes clearer."

Only time and developments will tell whether Thailand's tourism industry is affected to any serious degree by the coup.

However, the sector proved its ongoing popularity with overseas tourists by recovering strongly and quickly from 2004's tsunami - overseas visitor numbers in 2005 rose 15% to 13.38 million.

The Tourism Authority of Thailand and Western holiday companies must be hoping for the same resilience again.

Banks, government offices will open Thursday

Gen Winai Phattiyakul, secretary-general of the Administrative Reform Committee said Wednesday that Thursday would not be a holiday.

Answering reporters' questions at a press conference, Winai said Thursday would be normal working day.

He said the martial law would be lifted if the situation returned to normal.

The ARC issued an announcement at 4:55 pm, saying government agencies, state enterprises, schools, banks and the Stock Exchange of Thailand would be open on Thursday.

The Nation

[Aunty]

Well I have three questions about the immediate aftermath of the coup in Thailand.

1. What will happen now to that ridiculous 1am closing time for bars and clubs throughout the country? Will this be abolished and bar and club owners be allowed to stay open to a more reasonable hour to serve their customers?

2. Will there be any retraction to the recently announced VOA policy changes.

3. Will Farang's go back to buying condos using Thai companies, and will the land transfer office go back to looking the other way?

Thailand
September 20 2006 09:01

Risk has returned to haunt markets with a vengeance. Hot on the heels of riots in Hungary and massive hedge fund losses comes a military coup in Thailand.

Given the months of political turmoil in Thailand тАУ and the countryтАЩs penchant for coups тАУ there was always a possibility that tanks would roll in. Foreign investors, however, seem to have forgotten about political risk, ploughing a net $2.8bn into Thai equities last year. The level of investment this year is similar, on an annualised basis, and represents more than a quarter of inflows into emerging Asia. That looked increasingly hard to justify as political uncertainty trimmed economic growth and stunted corporate investment.

Bullish economic growth targets once pencilled in by Thaksin Shinawatra, the ousted prime minister, have subsequently fallen back to earth. The economy is expected to grow at an annual 4-4.5 per cent this year and next, pedestrian by emerging Asian standards. Moreover, nearly all of that comes from exports: domestic consumption and investment have fallen by the wayside in the face of political vacuums and caretaker governments. Grand pump-priming plans have likewise been relegated to the backburner.

Far from channelling their money elsewhere, investors justify their Thai allocations on the basis of discounted multiples. On a price/earnings basis, Thailand is certainly among AsiaтАЩs cheapest markets. But the decision to defer investments has left companies sitting on swollen piles of retained earnings, reducing return on equity. Prospects for growth are slim. Corporate earnings are forecast to grow by just 2.5 per cent this year and 4.9 per cent next, on consensus estimates. It is 15 years since ThailandтАЩs last military coup, so younger fund managers can perhaps be forgiven for neglecting to factor in sufficient political risk. If nothing else, the events of recent days are a reminder that markets are often cheap for a reason.