Foreign business communities in Thailand are hoping that the new government is established within one month, as the longer it is delayed the more opportunities the country will lose, according to the former chairman of the Joint Foreign Chambers of Commerce in Thailand (JFCCT).
Stanley Kang said that because there was no clear winner in the May 14 election, investors have been patiently waiting to see which parties would be able to form the new government.
"We understand there are processes. We hope everyone does their best and they should find the best solution that benefits the country the most, not their self-interest," said Mr Kang.
"I think they will form the government soon -- hopefully within one month," he told the Bangkok Post. "Foreign businesses are ready to work with anyone who successfully forms the government to ensure the economic development of Thailand."
Political protests are deemed to be acceptable as long as they are under control.
"I'm not so worried [about protests]. As long as they are under control, it should not be a big problem. We had a lot of experience in the past," Mr Kang said.
If the government formation is delayed until next May when the term of the Senate ends, Mr Kang said Thailand would lose significant opportunities.
"We have no time to wait that long. If the government cannot be formed as soon as possible, Thailand will lose a lot of opportunities. It will be very challenging for Thailand due to all the issues, but that is possible in the worst case," he said.
Meanwhile, stock market analysts said the Stock Exchange of Thailand (SET) index is volatile with thin trading value due to rising uncertainty about the government's formation.
Late on Monday the Office of Ombudsman asked the Constitutional Court to consider whether parliament's rejection of the Move Forward Party leader Pita Limjaroenrat's renomination for prime minister was unconstitutional and asked for the voting to be postponed until the court's ruling was made. It remained unclear earlier this week whether the second parliamentary vote for prime minister would be held as scheduled tomorrow. However, it has since been postponed.
"Government formation is becoming more unclear, so the political vacuum and budget vacuum may last longer," Asia Plus Securities (ASPS) said in a research note issued on Tuesday.
The political vacuum is likely to take longer so the 2024 budget may not be fully disbursed.
"Waiting until the Senate's term ends will lead to a political vacuum and a budget vacuum," noted the brokerage.
The 2024 budget is set to be disbursed from Oct 1, 2023 to Sept 30, 2024. However, if the political vacuum lasts until May 2024, the 2024 budget will not be fully disbursed for the shorter remaining term.
"Investors have to closely watch the political situation because political uncertainty triggers fund outflows and hurts the SET index," ASPS said.
KGI Securities said foreign net selling of Thai stocks looked significant on Monday. "That indicated a remaining anxiety on Thai politics and could limit near-term upside," it said.