Thai election set for January 6; race wide open

November 7, 2000
Web posted at: 8:21 PM HKT (1221 GMT)

BANGKOK, Thailand (Reuters) -- Thai Prime Minister Chuan Leekpai ended months of speculation on Tuesday by calling general elections for January 6, with the race for power wide open amid political horse-trading and accusations of corruption.

Chuan said parliament would be dissolved on Thursday. He is expected to seek an audience with King Bhumibol Adulyadej in the next couple of days to win formal permission for a dissolution.

"The suitable timing to give sufficient room for preparation for the election is January 6... Any time earlier than that would clash with the festive season," he told reporters.

"I will propose to His Majesty the King that the dissolution of the lower house takes place on November 9."

The election timetable was no surprise. But the likely outcome is proving far harder to call.

Telecoms tycoon Thaksin Shinawatra holds a clear lead in opinion polls, and under different circumstances would be regarded as certain to lead the next coalition government.

But Thaksin is under investigation by the National Counter Corruption Committee (NCCC) for failing to declare stakes in 17 companies during his past tenures as a government minister.

Thaksin insists he is simply guilty of an oversight rather than corruption, and says he is not worried by the investigation.

"It is just a matter of a misunderstanding. There is no evil intention," Thaksin told Reuters in an interview over the weekend. He said the investigation would clear him of wrongdoing.

But if the anti-graft body decides he deliberately concealed his assets he would face a five-year ban from politics.

"The country is now being clouded by major suspense, and nobody except the anti-graft agency has a clue as to how it will unravel," said Tulsathit Taptim, deputy managing editor of The Nation daily, in a front-page editorial on Tuesday.

Chuan has suffered a series of setbacks in recent months and has failed to close the gap on Thaksin despite the graft investigation. But his Democrat Party cannot be ruled out.

Chuan says the coalition partners have agreed to aim to work together after the election even if the Democrats only win second place in the polls. Opinions polls suggest that if they pool their seats, the parties may keep hold of a majority.

Such promises are notoriously fragile in Thailand's fractured political landscape, and Thaksin will be hoping to lure away Chuan's coalition partners. But everything hangs on the verdict of the NCCC, which could throw the campaign into chaos.

Tulsathit said Thailand was facing "suffocating political uncertainty."

"What is supposed to be a most predictable premiership race is growing more complicated each passing day," he said.

"If Thaksin's fate is sealed, Thai politics could come under a whirlwind of horse-trading and double crosses."

Thaksin's Thai Rak Thai (Thais Love Thais) Party is seen very much as his personal election vehicle and it is unclear how it would fare without him at the helm.

The uncertainty has financial markets on edge.

Thai markets have usually rallied as elections approach but the added political risk this time is sparking caution.

"With uncertainties over economic policies, the investigation of Thaksin Shinawatra by the NCCC and the slowing economy, we do not expect (stocks) to enjoy any significant rebound before the end of the year," said Kenneth Ng, head of research at ING Barings in Bangkok, in a report on prospects for November.

Shane Gunther, head of research at UBS Warburg Securities, said the election could be bullish for Thai markets if it produced a party strong enough to dominate a ruling coalition and provide strong leadership and decisive policy implementation.

But he said the role of the NCCC complicated the political picture. "Any investigations relating to top political parties does cast some uncertainty, and therefore there is some risk."

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