Most business leaders see last month's coup as a positive sign for the Kingdom's long-term economic development, according to a survey by the University of the Thai Chamber of Commerce.

Most of the 580 businessmen and businesswomen surveyed felt the coup would end the political crisis and social confusion.

They said the overall economic environment should recover by the second quarter of next year or within one year at the latest.

The survey was announced on the same day that GE Capital International Holding Corp delayed its planned purchase of Bank of Ayudhya's shares, as the American financial group re-assesses the situation after the coup.

It was also released on the same day that Moody's Investors Service showed its positive reaction to the creation of the economic advisory committee appointed by the military junta that took power on September 19. It called the panel - chaired by Bank of Thailand Governor MR Pridiyathorn Devakula - "a good step forward".

"There has also been noticeable progress in the restructuring of the Thai banking system, and the central bank has curbed excessive lending by state-owned financial institutions," Moody's vice president Thomas Byrne said in a statement.

"We recognise that uncertainty still exists over future political and economic developments and will closely monitor how events unfold," he said.

To Moody's, Thailand shows low level of vulnerability to exchange- and interest-rate shocks or to an adverse shift in foreign-creditor confidence.

"This should provide some breathing room for restoring Thailand's democratic and constitutional institutions, on which the long-run economic and financial stability of the country most likely depend," he said.

Moody's affirmed its investment-grade ratings for Thailand on September 20. Its outlook for Thailand's sovereign ratings is stable.

On Thai businessmen's survey, the chamber asked 580 executives from various business sectors - including the agricultural sector, services, manufacturing and trading - from September 22 through the 27th, three days after the military seized power.

Thanawat Polvichai, director of the economic and business forecasting centre at the university, said the business community in general believed the coup would lead to a return to normal economic development. He said those polled felt domestic spending and consumption, and investment from both Thai and foreign sources, would recover by the second quarter of next year.

"Although most business people see good signs for the economic future, most say they will not make new investments in the next six months," Thanawat said.

Almost 60 per cent said they would put new investments and expansion on hold until the new government's polices are clear, he said.

The poll found that 40 per cent of respondents believe the economy will grow by 4 to 4.5 per cent this year, while 26 per cent said they expected the economy to grow by the same amount next year.

About 32 per cent said the economy would grow more slowly, by 3.5 to 4 per cent next year, because of the delay in the last several months in the government's disbursement of the budget.

Saowanee Thairungroj, dean of the university's economics faculty, said executives hope the government will quickly solve three main problems: the economy, political stability, and the conflict in the South.

Yajai Chuwicha, head of the chamber business office at the university, said very few businesspeople were against the coup.

About 85 per cent of executives said they were "very satisfied" with the coup, saying that it would end the confusion in the Kingdom and improve both the political and economic situation, she said.

Only 0.3 per cent said they opposed the coup.

Petchanet Pratruangkrai

The Nation