'Bad for business'

'Bad for business' Thai and foreign business leaders on Tuesday came down strongly against the government's decision to declare a state of emergency, saying it would hurt investor sentiment and national business while failing to end the violence. Prime Minister Samak Sundaravej imposed the state of emergency in Bangkok, and said it would remain in effect until Nov 30. "The declaration of emergency make investors' confidence worse. It has also raised concerns over whether the situation in Bangkok is as bad as in war-zone countries like Iraq," said Santi Vilassakdanont, the chairman of the Federation of Thai Industries (FTI). "I hope things will be back on track as soon as possible, I know Mr Samak means to control the violence, but personally, I feel [an emergency declaration] is not the right resort as it makes the whole situation far worse than it was." He said the declaration had put questions in foreign investors, minds as to whether the People Alliance for Democracy (PAD) rally was out of control. Mr Santi said that the longer the state of emergency remained in place, the more the country would face economic losses, especially investors' confidence, which would be difficult to bring back. "We want to see the declaration of emergency lifted as soon as possible," Mr he. Mr Santi's comment was echoed by Nandor von de Luehe, chairman of the Joint Foreign Chamber of Commerce in Thailand (JFCCT). "We look at political stability and its predictability," he said. "The implementation of a state of emergency shows that Thailand is having stability problems, the government could no longer control the situation and I don't like seeing this happen." While he wishes the violence will end soon, he fears that Thailand is moving close to a situation rivalling the May 1992 violence. "The PAD was staging a peaceful rally, I don't know how the incident escalated into violence." Karl-Heinz Heckhausen, former chairman of the German Chamber of Commerce Thailand and head of DaimlerChrysler (Thailand), called on the government and demonstrators to hold talks. "They should sit down and compromise to find the solutions to prevent the violence from escalating further," said Mr Heckhausen. The political arena has become even more complicated with the Election Commission's unanimous vote yesterday to seek an order of the Constitution Court to dissolve the People Power Party on vote-buying committed by its former deputy leader Yongyuth Tiyapairat. Chai-anand Ukosakul, chairman of the Thai Chamber of Commerce's subcommittee on international trade, said the state of emergency had its pros and cons _ it may help control violence,but it definitely gives Thailand a bad image. "Foreigners may view that the situation is bad, to an uncontrollable level where peace measures can't help," he said. Phongsak Assakul, vice-chairman of the chamber, said a serious impact on export industries was anticipated if the Bangkok and Laem Chabang ports were forced to close. Chookiat Ophaswongse, president of the Thai Rice Exporters Association, however, said rice exports were not likely to be affected as most shipments utilised private ports not the state-run ports. Board of Investment secretary-general Satit Chanjavanakul said he still believed the declaration had not frightened off foreign investors as most expect to see the situation soften very soon. "Investors will continue to invest despite many concerns because they understand the situation and they can ask for explanations from their partners," Mr Satit said. However, he added "It is vital to make investors confident and for tourists come to Thailand. The country needs to be back on track as soon as soon as possible." Kongkiat Opaswongkarn, chief executive officer at the brokerage Asia Plus Securities, said he believed the state of emergency could actually help ward off the risk of further violence. "If the government did not use this measure, there would have been many people injured or dead from the violence. This is a way to put the brakes on all parties to stop the violence and seek peace through negotiations," he said. But Dr Kongkiat said a state of emergency, if protracted, would undermine investment, destroy the economy and hurt tourism.