Economy tipped for fast recovery

Economy tipped for fast recovery

EX-finance minister sees end soon

Former finance minister Pridiyathorn Devakula expects an economic recovery to occur soon as the political situation was moving closer towards a new prime minister.

MR Pridiyathorn appeared optimistic when he shared his views on the political crisis and the economy during a dinner talk on Friday organised by the Thai Institute of Directors Association.

He was encouraged that the Senate on Friday announced its support for national reform and a government with full authority to run the country.

MR Pridiyathorn Devakula (Photo by Apichart Jinakul)

Although anti-government protesters are demanding the swift appointment of an interim premier and pro-government red-shirt demonstrators are ramping up their counter-protest, MR Pridiyathorn believes the confrontations among rival parties will soon shift in favour of talks.

Talks are expected to be held tomorrow between senators and the caretaker government to discuss ways to resolve the political crisis.

If all sides agree to settle their differences at the negotiating table, Thailand can gradually solve the political turmoil that has taken a toll on the economy, MR Pridiyathorn said.

Once a new prime minister replaces the caretaker government with its limited administrative power, especially in budget affairs, the economy can be quickly restored.

He said three urgent tasks were needed to push the economy back on track.

The new government first needs to settle the overdue payments of about 90 billion baht owed to farmers under the controversial rice-pledging scheme.

Financial institutions are reluctant to lend money to the caretaker government because of doubts over its legitimacy to borrow.

But under a new government, MR Pridiyathorn said, money can quickly reach farmers and when they are financially better off, domestic demand is expected to increase.

The new government could also go ahead with budget spending, currently halted. State spending would help drive the economy forward.

Finally, the new government is committed to carrying on investing 1.28 trillion baht in basic infrastructure projects, ranging from new electric railways in Bangkok and double rail tracks to deep-sea ports.

Investment in railway projects will stimulate the real estate sector while the Pak Bara deep-sea port development in Satun will make Thailand a major centre for transportation in Southeast Asia, MR Pridiyathorn said.

“No matter who makes up the new government, it will be phra ek [heroic] when it finishes these tasks, which are quite easy to achieve,” he said.

MR Pridiyathorn expected a new government to be established within the next three months.

He said there was no reason for businesses to slow down their investments or feel discouraged by political problems.

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