|
|
| • EXCH RATES |
|
Baht/$ 33.49/52
Bid/Ask
|
GOLD |
14,650
- 50
|
|
STOCK MARKET
NUNTAWUN POLKUAMDEE
Oil prices rather than local politics will remain the main driver of the Stock Exchange of Thailand over the next several months, analysts said yesterday.
So long as political conflicts do not erupt into violence, they believe the ongoing disputes involving the People's Alliance for Democracy, former prime minister Thaksin Shinawatra and the ruling People's Power Party should not have a significant impact on the market.
But this assumes that the government is sensitive to the growing dissatisfaction of the public over state policies and the economy, according to Abhisit Vejjajiva, the leader of the opposition Democrat Party.
He told investors at a conference at the SET yesterday that economic and political stability required clarity from the government, starting with the need for Prime Minister Samak Sundaravej to shake up his cabinet.
 |
| Abhisit: Cabinet shake-up needed |
''It's clear that there are some ministers who have failed in their duties and should be changed,'' Mr Abhisit said.
He said the government's energy policy also needed a revamp to address the country's long-term problems in the face of soaring global oil prices.
Thailand needed to reduce its dependence on imported oil and improve its efficiency, he added.
Mr Abhisit said the government also needed contingency plans to address the problems of rising inflation and economic instability, and ensure that policies from the Finance Ministry and the Bank of Thailand, the country's two main economic bodies, were synchronised.
''If [Mr Samak] refuses to reshuffle the cabinet and continues to keep people who have failed in their duties, it will only be a growing burden on the government,'' he said.''Politicians should do their jobs earnestly and focus on working for the country rather than simply sit in their positions with no goals.''
Usara Wilaipich, a senior economist of Standard Chartered Bank (Thai), said the sharp declines of the SET over the past two months reflected not only internal problems, but external factors as well.
The SET index, which closed at 743.03 yesterday, has fallen by nearly 10% over the past three months and is off 13.5% since the beginning of the year.
Ms Usara said Thailand and other Asian countries were primarily net oil importers, and as a result faced problems in terms of inflation and their trade balances as oil prices rose.
The economy over the past two years posted only modest growth of 4% to 5%, she said, primarily driven by exports.
''Foreign investors have dumped their shareholdings due to fears that the currency will weaken, so they are exiting for fear of both [currency losses and capital losses],'' Ms Usara said.
But political conflicts did affect investor psychology and market confidence, she said.
''If the conflicts are protracted, certainly it will have a negative impact. But changes in economic policy will have an even greater impact,'' Ms Usara said, adding that trends for 2009 looked to worsen with inflation and declining corporate profits.
Panitan Wattanayakorn, a Chulalongkorn University associate professor of political science, said the impact of political instability on the economy would be highest if events turned violent.
He said so long as all parties remained within a legal, democratic framework, the disagreements voiced by various parties would have only a limited impact on the economy.
Maris Tarab, president of ING Funds (Thailand), said the conflicts over the past several years represented lost opportunities for the country's economic development.
''Thai companies have growth prospects and the competitiveness to attract interest from investors. What people are waiting for is only political stability and clarity,'' he said.
Prev
1
2
3
4
5
6
7
8
9
10
11
12
Next
