The recently sanctioned constitution in Thailand is giving more power to the military junta and it might just boost the economy.
Giving up democracy in exchange of tighter military junta control in Thailand is a result of the referendum that may help the country’s struggling economy. Sunday’s referendum yielded a 61.4% vote for a military-backed constitution. 94% of the overall votes have been counted when the declaration was made. Out of the total number of electorate however, only 55% voted.
This new constitution will hopefully bring stimulus to a waning Thai economy. The slump comes from the low external demand for the country’s exports. Add to that the uncertain political situation, stagnant investments, and a gloomy tourism sector and you won’t wonder why the Thai economy is in dire need of a much awaited boost.
Experts believe that the new constitution will bring good news. For one, they think that investors will be more at ease with the tighter junta control. This means investor sentiment is expected to bloom following the referendum. According to Kasikornbank capital markets head, Kobsidthi Silpachai, the vote will help rebuild political normalcy which is what investors seek in an economy.
Silpachai says, “What investors are more concerned about is actually no violence, continuity of policies. They get visibility on how they can plan towards foreign direct investment.”
The military junta has been in power since May of 2014. The military coup that succeeded is the twelfth in a line of revolution that ensued since the country adopted a constitutional monarchy in 1932. The Prime Minister seat was given to army chief Prayut Chan-o-cha to displace the controversial administration Yingluck Shinawatra.
The revolution was said to be a peacekeeping effort that would eventually restore democracy that has been plagued by unrest for years. According to Chan-o-cha, once political stability has been achieved he would step down to make way for a general election after the constitution was replaced.
The resulting tighter junta control is expected to lift up markets even if for a little while as it shows that the country is ready for political stability once more.