Latest news with #Paetongtarn
New Straits Times
an hour ago
- Business
- New Straits Times
Thai PM faces call to step down to avert coalition revolt
BANGKOK: Thailand's embattled Prime Minister Paetongtarn Shinawatra was facing the prospect of losing her government's majority on Friday, as a vital coalition partner looked set to demand her resignation after just 10 months in power. Paetongtarn, the politically inexperienced daughter of divisive tycoon and former premier Thaksin Shinawatra, is fighting fires on multiple fronts — struggling to breathe life into a stagnant economy facing steep US tariffs, and under pressure to take a tougher stand on a territorial row with Cambodia that has seen their troops mobilise at the border. The United Thai Nation party, the second-largest partner in her alliance, will demand Paetongtarn, 38, step down as a condition for it to remain in the Pheu Thai Party-led coalition, two UTN sources told Reuters, requesting anonymity because they were not authorised to speak to the media. "If she doesn't resign, the party would leave the government," one source said. "We want the party leader to tell the PM as a courtesy." Though Paetongtarn received a boost on Friday with another coalition partner, the Democrat Party, pledging its support, Thailand's youngest premier is still in an untenable position, with her majority hinging on UTN staying in the alliance following Wednesday's exit by the larger Bhumjaithai Party. UTN has not said when it will announce its position. Asked about its decision, UTN spokesperson Akaradej Wongpitakroj declined to provide details. "We have to wait for the party leader to inform the prime minister first," he said. Reflecting concerns in financial markets, the Thai baht (THB=TH) weakened for a fifth consecutive session on Friday and was on course to log its worst week since late February. Tumultuous Past Paetongtarn's battle to stay in power demonstrates the declining strength of Pheu Thai, the populist juggernaut of the billionaire Shinawatra family that has dominated Thai elections since 2001, enduring military coups and court rulings that have toppled multiple governments and prime ministers. But she is now facing domestic anger and the prospect of an internal revolt over Wednesday's embarrassing leak of a phone call between her and Cambodia's influential former leader Hun Sen — once seen as a Shinawatra family ally — which her critics say posed a threat to Thailand's sovereignty and integrity. During the conversation, Paetongtarn called for a peaceful resolution of the border dispute and disparaged an outspoken Thai army general who she said "just wants to look cool" — a red line in a country where the military has a high profile and significant political clout. Political activists met on Friday to schedule a major protest in Bangkok starting on June 28 to demand Paetongtarn resign and coalition partners leave the government. Those included groups with a history of crippling rallies against Shinawatra administrations. Paetongtarn has not commented on the turmoil in her government and has tried to present a united front on the Cambodia issue, appearing on Thursday alongside military chiefs and vowing to defend sovereignty. The premier will make a morale-boosting visit to military units at the Cambodia border on Friday, where she is due to meet Lieutenant General Boonsin Padklang, the regional commander whom she criticised in the leaked call. Paetongtarn's options for staying in power are limited unless her allies can succeed in behind-the-scenes horse-trading to keep her alliance from crumbling. A snap election could damage Pheu Thai at a time of dwindling popularity and play into the hands of the progressive opposition People's Party, the largest force in parliament.
Business Times
an hour ago
- Business
- Business Times
Thai stocks may fall to Covid lows amid political crisis: analyst
[SINGAPORE] Thailand's stock market cannot catch a break – the fallout from a major political crisis may further rock the worst-performing market in the world this year. Amid the existing headwinds from tariff uncertainty and the faltering tourism revenue, the Stock Exchange of Thailand's (SET) benchmark index has already wilted 23.8 per cent since the start of the year as at Friday (Jun 20), placing it last among all global equity indices, according to Bloomberg data. The market sell-off intensified in recent days as political jitters flared, following a leaked phone call between officials in Bangkok and Phnom Penh which heightened tensions along the Cambodian border. With economic headwinds already pressuring sentiment, analysts warn the bloodbath on the bourse may not yet be over. 'If foreign fund outflows accelerate and the prime minister faces calls to resign or a no-confidence vote, the SET Index could test 2020 Covid lows,' said Manish Bhargava, chief executive at Straits Investment Management. The index had fallen to a low of 969.1 points in March 2020, a level not seen since late-2011. Thailand's stock exchange was the worst-performing bourse in Asean on Thursday, with the SET Index plunging 2.4 per cent to 1068.7 – its sharpest drop this year – after the call was leaked on Wednesday. While other regional markets also posted losses, they did not match the scale of the Thai sell-off, underscoring growing investor unease as the kingdom faces domestic instability and macro headwinds. The losses came as a leaked phone call between Thai Prime Minister Paetongtarn Shinawatra and former Cambodian prime minister Hun Sen on Wednesday incited the Bhumjaithai Party (BJT) to announce its exit from the ruling coalition government. A NEWSLETTER FOR YOU Friday, 8.30 am Asean Business Business insights centering on South-east Asia's fast-growing economies. Sign Up Sign Up BJT's withdrawal leaves the ruling coalition, led by Paetongtarn's Pheu Thai Party, with a slim majority by just 18 seats. As calls for her resignation escalate and other coalition partners threaten to withdraw, uncertainty has arisen over the possibility of a Cabinet reshuffle, or a snap election that may lead to a political stalemate. This could mean a three to six-month wait for a new government to take office, said CGS International (CGSI) analyst Kasem Prunratanamala in a note on Wednesday night. 'We believe that it would be difficult for the SET to perform during this period.' Bhargava noted: 'Key sectors that are sensitive to political stability – banks, infrastructure and utilities – will likely lead declines.' Others, however, remained optimistic. OCBC Asean economists Lavanya Venkateswaran and Jonathan Ng maintained a baseline scenario of the political situation staying contained in a note on Jun 18, citing Paetongtarn's reconciliatory tone. The SET Index closed lower on Friday at 1067.6 points, falling 0.1 per cent. Tourist slump A slump in tourist arrivals to Thailand has reverberated through its economy, with the sector accounting for around 12 per cent of gross domestic product and employing more than 20 per cent of workers in 2024, according to the Bank of Thailand (BOT). Foreign tourist arrivals to the country dipped 11 per cent in May from the previous month, continuing what has been a slow start to the year for the industry. The 14.3 million tourist arrivals during the first five months of 2025 were down 2.7 per cent from the previous corresponding period last year, and brought in 1.9 per cent less revenue at about 668.4 billion baht (S$26.2 billion), according to a Bank of America note. The bourse's tourism sector, comprising stocks including spa operator Siam Wellness Group and hotel operators Central Plaza Hotel and Erawan Group, has fallen about 23.4 per cent since the start of the year. But hopes of a sector-wide revival have also led some analysts to look with more optimism at stocks that have been battered hard by the slump. 'The tourism sector has already priced in the bad news,' UOB said in a Jun 5 note, naming stocks such as Erawan Group and mall operator Central Pattana as rebound plays. 'We expect tourist arrivals to recover in the third quarter of 2025,' said UOB analysts Kitpon Praipaisarnkit and Krit Tanarattananon. Yet while the tourism sector's dips may have bottomed out, CGSI analyst Thanapol Jiratanakij does not foresee a 'swift recovery' in arrivals – largely owing to the declining popularity of the nation among Chinese tourists. Increasing safety concerns from incidents such as the abduction of a Chinese actor in January and an earthquake in March have put off some Chinese nationals, who have turned towards domestic tourism and other regional alternatives for leisure travel. Existing headwinds to tourist arrivals have also hit the country's retail sector, highlighted by unlisted retailer King Power's request to terminate its duty-free concession contracts with Airports of Thailand. Maybank had earlier downgraded the broader retail sector to neutral, with companies such as department store operator Central Retail receiving 'hold' ratings. The bank cited sector-wide headwinds in muted consumption, falling tourist arrivals and a subdued economic outlook. 'Restoring confidence among Chinese tourists will require real improvements in safety and perception,' CGSI's Thanapol said. 'In this regard, we believe the government still has considerable work to do.' But as Paetongtarn's leadership remains uncertain, such efforts to boost the domestic economy may no longer be on the cards. 'The timing could not be more inconvenient considering (the) external headwinds,' said OCBC's Venkateswaran and Ng. As observers await the BOT's policy decision on Jun 25, ANZ Asia economist Krystal Tan expects the central bank to hold its benchmark rate at 1.75 per cent until the fourth quarter – but a worsening political gridlock may force the BOT into a rate cut. This may provide a catalyst to Thai stocks amid the wavering political situation, said CGSI's Kasem. He maintained the index's target at 1,200 points, citing its relative undervaluation to its peers.
The Star
an hour ago
- Business
- The Star
Thailand's economy teeters as political turmoil threatens recovery efforts
BANGKOK: Thailand's economy is already on the ropes. Consumption has remained tepid despite a government stimulus programme, few of its economic engines are firing, and uncertainty wrought by US President Donald Trump's reciprocal tariffs means that the Thai economy could grow just over 1% this year. Now, South-East Asia's second-largest economy faces a fresh challenge: a new round of political chaos that can bring down Prime Minister Paetongtarn Shinawatra or her ruling Pheu Thai party. "We are currently in a period of economic downturn, with many issues affecting us," Visit Limlurcha, vice chairman of the Thai Chamber of Commerce, told Reuters. "This could make things even more complicated." The most significant short-term concern is the passage of a 3.78 trillion baht (US$115 billion) budget for the 2026 fiscal year, which starts on Oct 1, that must pass through parliament over the next few months. That process could get stalled if Paetongtarn, who is under siege for her handling of a festering border row with neighbouring Cambodia, dissolves parliament and triggers fresh elections. "If parliament is dissolved before the budget is passed, the process will be delayed significantly," said Prakit Siriwattanaket, managing director of Merchant Partners Asset Management. Thailand's economy has lagged regional peers as it struggles under high household debt and borrowing costs, and sluggish demand from China, which is also a key tourism market. It expanded 2.5% last year, and growth could be further halved this year due to US tariffs, Finance Minister Pichai Chunhavajira said last month. Thailand's stock market has been the worst performing bourse in Asia so far this year, down 23.4%. Industrial sentiment also hit its lowest in eight months in May, even as consumer confidence dropped to a 27-month low. There is a clear need to press ahead with government spending, which has dropped by over 38% annually during April-May 2025, OCBC economists Lavanya Venkateswaran and Jonathan Ng said in a report on Thursday, warning of a "double whammy" for the economy if both government expenditure and exports weaken. Amid the ongoing tumult, Paetongtarn may be able to hang on to her premiership and a coalition led by her Pheu Thai party could retain its majority, albeit in a weaker position compared to its previous grip on the parliament. Such an arrangement will prolong political instability and raise the spectre of street protests, which have been part of previous crises and could hit one of Thailand's key remaining economic engines: tourism. "I'm worried. I don't want the situation to cause people to take to the streets," Thienprasit Chaiyapatranun, President of Thai Hotels Association, which represents around 1,000 hospitality establishments, told Reuters. "If they take to the streets, it will hit tourism." Activists - including those who have in the past agitated against Paetongtarn's father, the divisive former premier Thaksin Shinawatra - met on Friday (June 20) to plan a major protest next week, and demanded the prime minister's resignation. A government lacking full authority may also struggle in ongoing trade negotiations with the United States, which has threatened to impose a 36% tariff rate on imports from Thailand, said Natapon Khamthakrue, an analyst at Yuanta Securities. "The United States certainly would not want to talk to a government without full power or with few votes," he said. Some business chambers and analysts are, nonetheless, holding out hope that a political resolution can be found quickly, minimising damage to the Thai economy, which has been rattled by multiple coups in the last eight decades, including two against governments led by the Shinawatra family. "Although the economy is no stranger to political uncertainty," OCBC's economists said, "the timing could not be more inconvenient considering external headwinds." - Reuters
Business Times
an hour ago
- Business
- Business Times
Thai stocks may fall to Covid lows amid political crisis: analysts
[SINGAPORE] Thailand's stock market cannot catch a break – the fallout from a major political crisis may further rock the worst-performing market in the world this year. Amid the existing headwinds from tariff uncertainty and the faltering tourism revenue, the Stock Exchange of Thailand's (SET) benchmark index has already wilted 23.8 per cent since the start of the year as at Friday (Jun 20), placing it last among all global equity indices, according to Bloomberg data. The market sell-off intensified in recent days as political jitters flared, following a leaked phone call between officials in Bangkok and Phnom Penh which heightened tensions along the Cambodian border. With economic headwinds already pressuring sentiment, analysts warn the bloodbath on the bourse may not yet be over. 'If foreign fund outflows accelerate and the prime minister faces calls to resign or a no-confidence vote, the SET Index could test 2020 Covid lows,' said Manish Bhargava, chief executive at Straits Investment Management. The index had fallen to a low of 969.1 points in March 2020, a level not seen since late-2011. Thailand's stock exchange was the worst-performing bourse in Asean on Thursday, with the SET Index plunging 2.4 per cent to 1068.7 – its sharpest drop this year – after the call was leaked on Wednesday. While other regional markets also posted losses, they did not match the scale of the Thai sell-off, underscoring growing investor unease as the kingdom faces domestic instability and macro headwinds. The losses came as a leaked phone call between Thai Prime Minister Paetongtarn Shinawatra and former Cambodian prime minister Hun Sen on Wednesday incited the Bhumjaithai Party (BJT) to announce its exit from the ruling coalition government. A NEWSLETTER FOR YOU Friday, 8.30 am Asean Business Business insights centering on South-east Asia's fast-growing economies. Sign Up Sign Up BJT's withdrawal leaves the ruling coalition, led by Paetongtarn's Pheu Thai Party, with a slim majority by just 18 seats. As calls for her resignation escalate and other coalition partners threaten to withdraw, uncertainty has arisen over the possibility of a Cabinet reshuffle, or a snap election that may lead to a political stalemate. This could mean a three to six-month wait for a new government to take office, said CGS International (CGSI) analyst Kasem Prunratanamala in a note on Wednesday night. 'We believe that it would be difficult for the SET to perform during this period.' Bhargava noted: 'Key sectors that are sensitive to political stability – banks, infrastructure and utilities – will likely lead declines.' Others, however, remained optimistic. OCBC Asean economists Lavanya Venkateswaran and Jonathan Ng maintained a baseline scenario of the political situation staying contained in a note on Jun 18, citing Paetongtarn's reconciliatory tone. The SET Index closed lower on Friday at 1067.6 points, falling 0.1 per cent. Tourist slump A slump in tourist arrivals to Thailand has reverberated through its economy, with the sector accounting for around 12 per cent of gross domestic product and employing more than 20 per cent of workers in 2024, according to the Bank of Thailand (BOT). Foreign tourist arrivals to the country dipped 11 per cent in May from the previous month, continuing what has been a slow start to the year for the industry. The 14.3 million tourist arrivals during the first five months of 2025 were down 2.7 per cent from the previous corresponding period last year, and brought in 1.9 per cent less revenue at about 668.4 billion baht (S$26.2 billion), according to a Bank of America note. The bourse's tourism sector, comprising stocks including spa operator Siam Wellness Group and hotel operators Central Plaza Hotel and Erawan Group, has fallen about 23.4 per cent since the start of the year. But hopes of a sector-wide revival have also led some analysts to look with more optimism at stocks that have been battered hard by the slump. 'The tourism sector has already priced in the bad news,' UOB said in a Jun 5 note, naming stocks such as Erawan Group and mall operator Central Pattana as rebound plays. 'We expect tourist arrivals to recover in the third quarter of 2025,' said UOB analysts Kitpon Praipaisarnkit and Krit Tanarattananon. Yet while the tourism sector's dips may have bottomed out, CGSI analyst Thanapol Jiratanakij does not foresee a 'swift recovery' in arrivals – largely owing to the declining popularity of the nation among Chinese tourists. Increasing safety concerns from incidents such as the abduction of a Chinese actor in January and an earthquake in March have put off some Chinese nationals, who have turned towards domestic tourism and other regional alternatives for leisure travel. Existing headwinds to tourist arrivals have also hit the country's retail sector, highlighted by unlisted retailer King Power's request to terminate its duty-free concession contracts with Airports of Thailand. Maybank had earlier downgraded the broader retail sector to neutral, with companies such as department store operator Central Retail receiving 'hold' ratings. The bank cited sector-wide headwinds in muted consumption, falling tourist arrivals and a subdued economic outlook. 'Restoring confidence among Chinese tourists will require real improvements in safety and perception,' CGSI's Thanapol said. 'In this regard, we believe the government still has considerable work to do.' But as Paetongtarn's leadership remains uncertain, such efforts to boost the domestic economy may no longer be on the cards. 'The timing could not be more inconvenient considering (the) external headwinds,' said OCBC's Venkateswaran and Ng. As observers await the BOT's policy decision on Jun 25, ANZ Asia economist Krystal Tan expects the central bank to hold its benchmark rate at 1.75 per cent until the fourth quarter – but a worsening political gridlock may force the BOT into a rate cut. This may provide a catalyst to Thai stocks amid the wavering political situation, said CGSI's Kasem. He maintained the index's target at 1,200 points, citing its relative undervaluation to its peers.
RTHK
2 hours ago
- Business
- RTHK
Thai PM meets army commander in bid to save coalition
Thai PM meets army commander in bid to save coalition Paetongtarn Shinawatra speaks with Lieutenant General Boonsin Padklang in Ubon Ratchathani province as part of an effort to save her job. Photo: Reuters Thai Prime Minister Paetongtarn Shinawatra held make-up talks on Friday with an army commander she criticised in a leaked phone call as she struggled to defuse a crisis threatening to topple her government. The daughter of billionaire ex-PM Thaksin Shinawatra and in office for less than a year, Paetongtarn is facing calls to quit or announce an election as anger flares over the call with former Cambodian leader Hun Sen. Her main coalition partner, the conservative Bhumjaithai party, pulled out on Wednesday, saying she had insulted the country and the army and leaving her government on the point of collapse. She suffered another blow on Friday as reports emerged that another coalition partner was threatening to quit unless she stepped down as prime minister. The crisis has sent the Thai stock market plunging to a five-year low and comes as the kingdom struggles to fire up its sluggish economy, with US President Donald Trump's threatened trade tariffs looming. Paetongtarn, 38, visited troops in northeast Thailand on Friday to patch things up with Lieutenant General Boonsin Padklang after she was caught disparaging him as an "opponent" during the call with Hun Sen. Boonsin commands Thai forces along the border with Cambodia, where a long-running dispute flared into deadly clashes last month, and Paetongtarn's criticism of him drew accusations of disloyalty from right-wing nationalist critics. Paetongtarn said after their meeting that the matter was settled. "It went very well. I've spoken to the commander and there's no longer any issue," she told reporters. For his part, Boonsin said "everything is normal". The meeting with Boonsin followed a public apology from Paetongtarn – at a news conference flanked by military and police chiefs – on Thursday as pressure on her mounted. Paetongtarn was criticised as being weak and deferential in the call with Hun Sen, a veteran politician known as a wily operator, but her comments about the army commander were potentially the most damaging to her. Thailand's armed forces have long played a powerful role in the kingdom's politics and politicians are usually careful not to antagonise them. The apology and apparent reconciliation with the army commander may not be enough to save Paetongtarn's premiership. The departure of Bhumjaithai has left the government's coalition with a razor-thin majority in parliament and losing another partner would likely see it collapse. There was a glimmer of good news for Paetongtarn on Friday morning as the conservative Democrat Party pledged to stay in the coalition. However, Public broadcaster ThaiPBS reported that the United Thai Nation (UTN) party, which has 36 seats and is now the biggest party in the coalition after Pheu Thai, is considering quitting. The broadcaster said UTN was going to issue an ultimatum to Paetongtarn: either she quits as premier or they withdraw, bringing down the government. (AFP)
