Readers' Submissions

Politics

  • Written by Will
  • December 5th, 2008
  • 5 min read


In September I wrote an article on renting or buying, the pros and the cons (3 September 2009). In it I wrote as a final paragraph the following. “At the end of the day if you decide to buy in Thailand you are taking a risk on the political and economic risks of the country. To me, given the global economic uncertainly and a global recession renting may be the smarter move in the short term which is up to five years as you have the flexibility to relocate at minimal cost.”

Well the risk of investing in Thailand has now certainly increased considerably. The PAD has been quite lucky with their timing because of world events. The global crisis affecting Europe and the USA have certainly diverted attention and the terror attacks in India put the focus on that country rather than Thailand. However, I have been seeing more articles in the west portraying the current situation in Thailand in a unfavourable light. The current crisis in Thailand is not going to go away and more attention will be focused on it.

Looking at areas that will be affected.

The tourist industry. I think the PAD and its supporters need to look beyond the borders of Thailand to see the effect they are having on the country. Whilst shutting down an airport may have been a week long protest, the psychological damage it has done to the image of Thailand is incredible. I will give you an example of a friend of mine who has flown to Thailand. I has cost her an extra £500 to amend flights. Well that money that will not be going into locals pockets. They are seasoned travellers. A lot more individuals will be easily put off. I do not mean your Billy backpacker type; I mean the families that go to the resort and the upmarket locations. The ones that have one good holiday a year and work hard and want to enjoy themselves. Because of the global economic slowdown they will look at cheaper and safer destinations and I am sorry but for Americans, Panama or Thailand well, Panama is safer and you feel welcome and if anything happened Uncle Sam will rescue you as Panama has an important canal running through it.

The property market. Well what do you think is going to happen? It's going to go down faster than a bar girl offered 3,000 baht for a short time. In the USA and Europe property prices are falling. The Russian stock market over the past three month has declined from 1300 to 600; there are a lot of Russians facing the squeeze, so no big Eastern European buyers are coming over as they need to conserve their cash. As for Europeans, well trying to get a mortgage or raise finance right now is about as easy as finding a virgin in a gogo bar. In America it’s the same. Car sales have fallen off a cliff and are plummeting like boulder off a mountain. I also think that a lot of property will have been bought on borrowed money or other parts of individuals savings are leveraged so individuals will be looking to liquidate their investments. I used for this the number of properties that seem to be for sale in Pattaya and other major areas, so their could be a lot of foreclosures in the future. You try to pursue a mortgage outstanding when the individual lives overseas. It is difficult and almost impossible to enforce. So you get the drift, I think the chance of a boom on property sales in Thailand over the next 18 months, well I think you have more chance of having snow in Pattaya on Christmas day.

General economic prospects for Thailand in the next 18 months do not look good. It may be appear to be hunky dory at the moment but I think the Pattaya flying club is about to have a whole lot more inductees over the next few months as the reality of the economic situation sets in for many people. The tourist trade will be hit first, not just the bookings but all the sellers of tourist items and other areas. With the government forced to resign and put itself up for election and the fact that results do not go the PAD way then here we go again until the “right” result is obtained. Meanwhile anyone thinking of starting a business or doing business in Thailand will look elsewhere. The opportunity to close down a factory because of the difficult business environment will be easy. Also do you have a business in a country with a fluid political situation is consistent one. Vietnam may be a one party state (and I am sure a number of readers have an opinion on this) but at least you know who you are dealing with and get a consistent approach, even if you have to grease a few palms at least you know next month the same palms will still be around to resolve any problems that you may have. In business the one thing individuals need when deciding to invest is consistency and at the present time their does not seem to be any of this. So stand by for lots of angry ordinary Thais who have lost their jobs in the next few months. Remember the social security networks we have in the developed world do not exist in Thailand, so keeping one's head above water to drowning can occur very quickly.

I do hope that all parties, both red and yellow, come to some sense quickly or else I think it could descend a lot further. The parties behind this need to realise that this could end up a bloody mess for all concerned. Given the state of the world economy it is not the time for Thailand to make things worse for itself and push the world towards the door. The only individuals who will really suffer will be the individuals at the bottom of the pile the poor Thaïs. I think also that if things get nasty then foreigners will get blamed, so their could be a backlash there.

Thai Dating, Singles and Personals

Stickman's thoughts:

The events of the past week and a half have done no good for foreigners' confidence in Thailand, whatever the industry.