BANGKOK – After nearly two years of political doom and gloom, suddenly Thailand’s economic prospects are brightening. Foreign investors have ushered in the 10th anniversary of Thailand’s spectacular 1997 collapse with a buying binge, recently bidding up the local bourse and currency to 10-year highs. But should foreign punters be so optimistic? Foreign capital is rushing into the country, with foreign equity inflows so far this year exceeding US$3.7 billion, including an inrush of US$600 million over the last fortnight. Foreign direct investments (FDI) has also exceeded expectations, and some economic analysts believe those capital inflows could accelerate in the months ahead as the government approves more foreign applications to produce so-called “eco-cars”.
Political uncertainty and policy miscues have this year weighed against the Thai bourseÂ’s performance, which on a price-equity ratio basis has lagged badly most other global emerging markets. Now with deposed Prime Minister Thaksin Shinawatra fading from view, and the ruling military junta that ousted him sticking to its promise to hold democratic polls by yearÂ’s end, investors see new clarity in the countryÂ’s political outlook.
“It’s clear now that Thailand is not going to fall off the cliff anytime soon,” says Cem Karacadag, an economist with Credit Suisse. “And it’s the cheapest market in Asia.”
| The article continues at length with not a single word about the insurgency in the southern provinces. How in the world would investor plop their money into what's going to be strife-ridden state, unless they're betting that the Buddhist north is going to land hard on the insurgents? |