More violence 'would dent investment'

Business leaders yesterday expressed fears the People's Alliance for Democracy's protests could lead to more violence and bloodshed.

This could delay investment projects in the pipeline and drive away foreign tourists unsure of their safety.

Some shops near the government agencies taken over by the PAD closed business yesterday, while some companies allowed their staff to leave office earlier than usual. Traffic was light at other parts of the city.

Santi Vilassakdanont, chairman of Thai Industries Federation, is hopeful that the situation would not get worse or foreign investors' confidence would be shaken hard if the government is forced to declare the state of emergency.

While foreign investors with long-time existence in Thailand would stay, the violence worsens the country's image and drive away new investors. "The violence would plunge domestic consumption and investment and now what we can do is praying that our export destinations are performing well to keep the economy going," he said.

The Thai Chamber of Commerce and the Board of Trade of Thailand will call for a special member meeting to assess the situation if things get worse, said the associations' chairman Pramon Sutivong. The situation would be closely monitored to estimate whether the protests affect the economic growth.

Suchart Chantaranakaracha, chairman of Thai National Shippers' Council, denounced the PAD's moves to take control of government agencies in Bangkok, citing that it is illegal, causes troubles to the public and hurts the Kingdom's image among foreign countries. He said PAD should have resorted to better strategies, if wanting to kick out the government.

"The public should not be panicked. PAD should not provoke any futher violence and the government should try to control the situation. If this is the case, the economy will move on," he said, adding that Thailand's economy is somewhat resilient to political unrest with continued growth rate despite chronic instability.

Professor Manop Bongsatad, president of the International Real Estate Federation of Thailand, feared that PAD could go further to burn down government agencies which would send a significant impact on the investment and economy. Foreign investors, including those with definite plans, could adopt a wait-and-see attitude given the uncontrolled riots.

"I don't see a way out. Violence could continue as it's beyond the government's capacity to control the situation. Soldiers and police are extremely careful in launching actions as this is a sensitive issue. Clashes would lead to casualties. Even one man dies, it could lead to a snowball effect," Manop said.

He noted that not all support PAD's actions. Even though they agreed with its clauses, they are against violence.

Cannon Marketing (Thailand) President and CEO Wataru Nishioka believed that some investors may delay investment while consumers' confidence is shaken. The Japanese company's Thai unit however believes that Thailand's economic fundamentals remain strong particularly the export sector. The company itself would reassess the situation and could review business plans if the situation changes.

Salin Tohtubtiang, chairman of Kuang Pei San Food Products (Pumpui), said that the private sector wants to see the matter end by the peaceful means. However, it is difficult to control the massive rally. All parties should be careful or the country would be affected badly particularly the tourism industry.

"This is first time that a large number of protesters managed to get into the government offices. It's not the nature of Thai people," she said.

While Thailand's trade continues, the tourism sector is expected to be hit hard by the internal conflicts.

Amid fears that foreign tourists who are sensitive to violence news could avoid visiting Thailand, Tassapon Bijleveld, chief executive officer Thai AirAsia Co, said rising safety concerns would damage the tourism industry. This could hurt the upcoming high season as booking for October-February travelling is on the way.

"Many would divert to other countries where they feel safer," said Apichart Sankary, president of Association of Thai Travel Agents (ATTA). If the situation prolongs, the industry would be hard hit and would be difficult to be normalised. He urged all parties to ponder future impacts.

Bank for Agriculture and Agricultural Cooperatives President Thirapong Tangthirasunan urged all to show others compassion.

"Some mistakes should be forgiven while irregularities (corruption in particular) should be tackled by the legal process," he said.

Pornsilp Patcharintanakul, deputy secretary general to the Board of Trade of Thailand, called for Prime Minister Samak Sundaravej's resignation or the withdrawal of coalition parties from the government to lead to peaceful resolution.

Thanavath Phonvichai, director of the Thai Chamber of Commerce University's Economic and Business Forecasting Centre, said that if the demonstration ends within a few days, it would not hurt overall economic growth. However, if the protest prolongs, it would destroy consumer confidence and economy in the next three months.