Thailand: Call for early elections in Thailand after dissolution of parliament
December 12, 2013
King Bhumibol Adulyadej complied with Prime Minister Yingluck Shinawatra's request on 9 December to dissolve the parliament and call for early elections, which will take place on 2 February 2014. The decision was fueled by the resignation of all opposition deputies from the parliament on 8 December. Political tensions have been high between the ruling Pheu Thai Party (PTP) and the opposition Democrat Party since 2006 when the Thai military launched a coup against former Prime Minister Thaksin Shinawatra, following a year-long political crisis. Tensions intensified a month ago, when supporters of the opposition (the so-called "yellow shirts") took over the streets of Bangkok in protest of an amnesty bill the PTP had proposed. The amended bill offered blanket amnesty to Thaksin, Prime Minister Yingluck's brother, who has been in self-imposed exile since 2008 in order to avoid facing charges of corruption. On 11 November, the Senate voted down the amnesty bill in hopes of easing political tensions. The call for early elections failed to quell the anti-government protests. Following the dissolution of the parliament, the yellow shirts hope to replace the current government with an unelected "People's Council". In addition, they aim to change the current constitution and ban the policies that were implemented over the course of the PTP's rule. The Democrats do not believe that the election will be the solution to the current political crisis and thus the protests could lead to a new military coup. In the short-term, the political turmoil is expected to have an impact on key sectors of the economy, such as tourism and investment. Against this backdrop, FocusEconomics panelists downgraded their growth projections for both this year and the next. For 2013, the panel expects the economy to grow 3.3%, which is down 0.3 percentage points from last month's estimate. For next year, the panel projects that GDP will grow 4.4%, which is down 0.1 percentage points from the previous month's estimate.
Author: Dirina Mançellari, Senior Economist