Thailand: Prime Minister Prayut Chan-o-cha expected to hold on to power in first election since 2014
Thailand is scheduled to hold a general election on 24 March and the military is likely to maintain significant influence over politics following the vote. Incumbent Prime Minster Prayut Chan-o-cha’s Phalang Pracharat (PP) party, together with other political groupings in parliament, is expected to be victorious. As a result, this should see a broad continuation of economic policies. However, a PP-led coalition could potentially lead to greater political instability due to the sheer number of parties involved.
Recent legal changes should ensure military sway over politics going forward. Crucially, the 250 members of Thailand’s upper house, the Senate, are to be appointed by the military and therefore expected to support the PP-led coalition. Moreover, the prime minister needs to be backed by a combined majority of both the upper house and the 500-seat lower house. Therefore, even if the PP-led coalition were to lose the election, the military would still likely have leverage over who becomes the new prime minister. That said, the coalition of parties opposed to the military junta, led by the Pheu Thai party, is expected to mount a strong challenge, although the recent dissolution of one of its constituents—the Thai Raksa Chart Party (TRC)—has improved the odds of a Prayut victory.
A victory for Prayut should provide continuity over economic policy, which has been fiscally responsible and guided solid growth in recent years even if this was partially thanks to inventory re-stocking. Moreover, a return to democracy could prove to be supportive of economic growth by improving investor confidence. Historical data shows private investment growth has been significantly higher during periods of elected governments as opposed to military leadership.