Prime Minister Surayud Chulanont, third right, talks with Mitsuhiro Sonoda, president of the Japanese Chamber of Commerce in Thailand and president of Toyota Motor Thailand, during yesterday’s luncheon.

Japanese investors welcomed Prime Minister Surayud Chulanont's pledge to hold a general election within six months and give priority to equality and good governance in achieving stability.

Nonetheless, they refused to say whether they believed the worst was over for Thailand's political uncertainty.

Toyota Motor Thailand president Mitsuhiro Sonoda said, "It's difficult for Japanese to understand the real situation. But many of my Thai friends told me that maybe the situation will become better."

Surayud yesterday gave a speech during a luncheon hosted by the Thai-Japanese Association at the Dusit Thani Hotel. He assured Japanese investors that in the next six months, he would "make Thailand become a leading democratic nation in Asia once again".

Thai-Japanese Association president Staporn Kavitanon said the meeting was suggested by Surayud late last year, because the PM wanted to explain the situation to Japanese investors, who are the biggest foreign investors in the Kingdom.

Yoichi Kato, president of the Japan External Trade Organisation in Bangkok, was impressed by Surayud's speech.

"We are happy. We understand we can share the same values regarding good governance. The prime minister spoke about transparency, evenness and fairness," he said. "If Thailand's policies are carried out according to the principles the prime minister mentioned today, we will find a clear solution to the problems."

Surayud's meeting with over 500 Japanese executives and the association's members was part of the government's attempt to restore foreign confidence. "Although the political situation is fragile, trade and investment will be looked after and promoted," he told his audience.

He said that during his visit to Japan in April, he was asked about the violence in the deep South. Surayud said he would try to use peaceful means to solve the conflict and "win the hearts and minds of the people".

Toshiba Thailand president Hidenori Matsui said, "I appreciated the opportunity to listen to the speech of the prime minister. He spoke about transparency and fairness. These key words are quite important for the future. I believe they will be the key words to lead the Thai people."

Matsui said he thought the highlight of Surayud's speech was that he would like to concentrate on making Thais participate in political activities and fighting corruption. "This kind of action plan will considerably develop Thailand," he added.

Asked to what extent Thai politics had dampened foreign investors' confidence in the country, he said, "There are various evaluations. Some believe the economic slow-down was not caused just by the political situation, but also by inflation, high appreciation of the baht and Thai policies.

"I think that Thailand is a very attractive country, because of its infrastructure and people, and already we have the Japan-Thailand Economic Partnership Agreement. The current situation may make some hesitant, but personally my concern is about the appreciation of the baht. When we look at investment, most Japanese companies think about Thailand as a base for exports."

Toyota chief Sonoda said Japanese investors were very concerned about Thailand's political situation, but he doubted whether they would change their long-term investment plans because of it.

Asked what were the biggest concerns for Japanese investors, he said, "First, security. Second, the political situation and whether the political timeline will be completed on schedule. A short-term concern is how to stimulate the current political situation. Our headquarters will be very encouraged by the direction."

He noted that politics aside, the government should also promote education and training, in order to help industry in the medium term.

Japanese Chamber of Commerce (JCC) vice president Tetsuji Banno said most Japanese investors were concerned about the Kingdom's political instability and the baht's strength.

"The sooner the next election is held, the more confidence Japanese investors will have in their investments here," he said.

Negative factors have not affected their long-term investment projects, he said. Nevertheless, some small- and medium-sized Japanese operators have suspended their projects.

The JCC will announce its updated survey on Japanese operators' confidence on July 4.

Jeerawat Na Thalang,

Chalida

Ekvitthayavechnukul

The Nation