Stumbling Thai economy lends urgency to junta's revival efforts

Stumbling Thai economy lends urgency to junta's revival efforts

BANGKOK - Thailand is expected to publish data on Friday showing stagnant consumption and investment, more evidence of a stumbling economy that will lend urgency to the military junta's efforts to get the country working again.

Southeast Asia's second-biggest economy has been battered by political turmoil since late last year when protesters backed by the royalist establishment launched a bid to oust the government of Prime Minister Yingluck Shinawatra.

The government hung onto power even after a court forced Yingluck out of office for abuse of power on May 7, but the military ousted it in a coup on May 22, saying a takeover was necessary to restore order and prevent more violence.

Military rulers have held out little hope for early elections despite calls from the United States and other allies for a quick restoration of democracy.

Army chief and coup leader General Prayuth Chan-ocha has spoken of the need for broad reforms before an election. Another top officer said on Thursday conditions had to be right and divisions healed before a return to civilian rule.

Thailand has become polarised between supporters of Yingluck and her influential brother, deposed premier Thaksin Shinawatra, and the royalist establishment that sees Thaksin and his populist ways as a threat to the old order.

Despite the animosity of the elite and the Bangkok middle class, Thaksin's popularity in the rural north and northeast has ensured that he or his allies have won every election since 2001.

Gross domestic product shrank 2.1 per cent in the first quarter of 2014 as the lengthy anti-government protesters damaged confidence and scared off tourists. Friday's private consumption and investment data for April are likely to show the depression continued into the second quarter.

Data on Wednesday showed factory output fell for the 13th straight month in April, imports plunged and exports remained weak, underscoring the difficulty the military government faces in averting recession.

'PRESSING TASK'

Navy commander Admiral Narong Pipattanasai, the junta member overseeing tourism, told reporters on Thursday that 26 million people were expected to visit this year, down from a targeted 28 million, because of the unrest.

He said revenue from tourism was expected to drop to 1.8 trillion baht (US$55 billion). The authorities had been banking on 2 trillion.

"We will do our best to improve the situation," Narong said.

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