Pavida Pananond, an associate professor at Thammasat Business School’s Department of International Business, Logistics and Transport and a well-respected academic shares her views on various issues that are going on in the country.
These include the outbreak of the coronavirus, the ongoing student movement against what they see as the “lack of political development” in Thailand, and a court decision that has undermined the Rule of Law in this country.
The impact of the coronavirus on exports
It is quite clear that the coronavirus outbreak is affecting Thailand’s tourism and export sectors. The movement of goods in the supply chain has been disrupted as the production in China has been paused. This is creating a slipover impact on Thai suppliers and manufacturers that rely on raw material from the mainland.
The impact of the disruption in the supply chain will be more apparent this month when February’s numbers are shown.
“[A contraction in exports] is very likely because exports would be affected by the already dampened global demand following the US-China trade war.”
The impact of the coronavirus on retail
In Thailand, the outbreak is impacting consumer sentiment because people are avoiding crowded places. This is undermining businesses that rely on foot traffic such as shopping malls and restaurants.
There is also a trend of people saying that they should be stocking up on canned and dried foods which is not helping the situation, she said.
“This kind of panic does not help and it might happen because people are feeding on rumors,” she said. “These are the changes in behavior that will be in the short-term aspect. In the longer term, retail will be affected because of the reduced number of shoppers,” she said.
The impact of coronavirus on travel
Apart from the movement of goods, the outbreak is also affecting tourism and airline services, and as well as the movement of people.
Right now, you can see the ramifications extending beyond the movement of the Chinese, she said.
“If the US or the UK raised their warning for citizens who travel to countries that are considered to be high risk, [it will] directly deter the movement of people,” she added.
Major travel hubs or transit points like Dubai and Abu Dhabi in the UAE will likely be affected by travel warnings and weary travelers as well, Pavida said. If the WHO upgrades the disease to pandemic status, look for the situation to get even worse for those in the tourism and travel industry.
Coronavirus on student protests
Pavida said the outbreak of the coronavirus might discourage large gatherings of people, especially among those who are not working or studying in universities from joining student protests against the Prayudh Chan-Ocha government. However, it will not stop the students’ discontent.
“The Students’ sentiment against the government should not be affected by the coronavirus outbreak,” she said. “But if the university that is involved in the rally announces that they have to close down because of an outbreak, that would affect the political activity inside the universities.”
On the student movement
On the student movement, Pavida said what we are seeing with the student movement inside universities is “a welcome sign” and she believes that this kind of “expression of political ideas” should be welcomed no matter what the ideas are.
“If there is a group of students that want to organize activities to support the government then they should also be allowed to do so,” she said. “A university is an academic space where freedom of expression of people should be respected.”
Student movement on political stability
It is too early to say that the ongoing student movement that we are seeing across universities nationwide would lead to some kind of political instability.
But, this is a sign that young people no longer accept the deterioration of democracy in the country.
“This is a signal that there is a lot of discontentment among the young generation against what is happening in Thailand in terms of the lack of political development,” she said.
“And yes, things may not be so smooth going forward compared to when the government had Article 44 to control dissents and opposition”
She said that more and more people are questioning the government and if we are to look beyond the student movement, then the rising tension is undermining confidence in the government.
Student movement on the economy
The political situation has been occupying most of the government’s time from the delay in the fiscal budget bill, the dissolution of the Future Forward Party (FFP) and the censure debate.
Now they will have to be concerned over the student protests and this will certainly affect the economy as well, she added.
“When they have nothing much to worry about, they still did not do a stellar job and now they have deal with more political undercurrent to manage so their focus on the economy will likely be more distracted” she explained.
On the Rule of Law
The political situation in the past month has undermined the country’s standing in regards to the rule of law, especially with the dissolution of FFP and other issues that were raised by academics and people who study the constitution.
This development will affect foreign investor confidence, she said.
“Thailand now looks like a country that does not has a transparent rule of law,” she said.
“Loans or land rights can be interpreted differently for different parties and the integrity of some independent institutions are being questioned,” she said.
She said this is one of the concerns which any investors would have, whether they would be investing in a country where rules and regulations may be different for them and they would not be entering an even playing field.
“If you are foreign investors looking at countries whose rule of law is being questioned, you would wonder whether rules and regulations governing business and economic activities will be interpreted the same way,” she explained.
Pavida pointed out that “big businesses” that have aligned themselves with the government coalition are doing “very well” and they are not under any close scrutiny.
This is why some activities of the government-aligned businesses should be investigated.
On the government economic performance
Pavida said the government’s economic performance has been subpar.
She said the government has yet to come up with “visionary measures” and what we have been seeing more of are mostly “peripheral populist policies” such as “Chim-Shop-Chai”.
“The measures are not addressing the root causes of the problems and they can only neutralize minor symptoms,” she added.
She said that so far, she has yet to see the government come up with a visionary direction that would lead the country out of the “economic doldrums.”
She said that globalization has placed emphasis on services and higher value addition but the country is still focused on traditional export-supporting measures, such as the need for weak baht.
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