Foreign investment will be hit: chambers

The Joint Foreign Chambers of Commerce in Thailand (JFCCT) and the Bangkok office of the Japan External Trade Organisation yesterday said the political unrest would damage foreign investment in Thailand.

"For investors, political stability is the most important thing. The latest developments have not contributed positively to stability and predictability," said JFCCT president Nandor von der Luehe.

Von der Luehe said Thailand had been doing

pretty well despite the many problems it faced but that it was also paying a cost in lost opportunities. Without the tensions, it could have done even better.

Apisak Tantivorawong, president of both the Thai Bankers' Association and Krung Thai Bank, agreed the political unrest had eroded business confidence.

"The economy does well when businessmen and investors are confident, so we need to rebuild sentiment. Hopefully, the unrest will be short-lived," he said.

"The problem is there is

no signs of improvement yet. Due to the lack of fresh investment, the demand for new long-term loans is weak. At present, much of the business comes from revolving credit. I think we need a return of political stability, to boost business confidence before there are new investment projects. Instability is now a major risk."

Meanwhile, Board of Investment (BoI) deputy

secretary-general Hirunya Suchinai said the People's Alliance for Democracy protest had harmed investor confidence.

"Our offices abroad have been trying to explain the situation to foreign investors. We've reassured them that investment-promotion policies remained intact and had nothing to do with the political unrest," she said.

Although the BoI has targeted Bt600 billion worth of new investment this year, Hirunya said that would be more difficult to achieve if the political situation did not return to normal quickly.