Thailand. Efforts to get Thailand out of its economic
crisis began to produce results. According to
Countryaah official website, two stimulus packages
totaling almost seven billion dollars were intended to clean
up the property market and create jobs in the countryside.
The latter package included tax cuts for small businesses
and low-income earners, lower energy taxes and temporarily
reduced VAT. While the measure contributed to raising the
budget deficit to 6% of GDP, it was supported World Bank.
A special bankruptcy court was set up in an attempt to
recover the huge sums of outstanding loans that slowed the
economic recovery. These so-called bad loans represented
more than 45% of the total loan amount.
In September, the government said it was expecting growth
of up to 4% in 1999 and that therefore it was not necessary
to utilize the entire $ 17 billion credit granted by the
International Monetary Fund in 1997. About three billion
remained to be withdrawn.
In July, the Social Action Party, Kij Sangkhom, left the
coalition government, weakening government support in
parliament by 20 votes.
Thailand's economy is now growing even stronger, reaching
89 per cent in annual growth of 10.5%. At the same time,
both the EC and the US made a difference. In the first case,
Thailand criticized the extensive Community subsidies for
agricultural products competing with Thai on the world
market. Ifht. The United States was conflicted that Thailand
would not accept the North American Intellectual Property
Guidelines. This was particularly the case with trade in
The Chatichai government concentrated mainly on foreign
policy and did not tackle the domestic policy problems that
the severe absolute poverty experienced by most of the
population or the increasing destruction of the environment.
The increasingly rapid deforestation in 89 led to floods
that assumed catastrophic dimensions due to the importance
of the forest for regulating the humidity and destruction of
the trees along the rivers. The government had to ban
further deforestation to prevent further damage. The
government, in cooperation with the World Bank, encouraged
extensive planting of eucalyptus trees, but this was
counteracted by the poor peasants who regarded the new
commercial forests as a serious competition for their
traditional municipal forests.
In March 91, the military, led by General Sunthorn
Kongsompong, conducted a new coup, and presented a draft new
constitution to King Bhumibol Adulyadej. This approved the
draft, defended the military coup with "the rising
corruption" in the civilian government, and agreed with the
military in printing new elections. As an indirect
consequence of the military coup, peace talks in Cambodia
were more or less stalled as the country's government
condemned renewed Thai support for Cambodia's armed
opposition. Through 91, Thailand was subject to the National
Peace Conservation Council (NPKC) - a military body led by
General Sunthorn. In December, the king proposed a new
constitution, which required elections within 120 days to
replace the NPKC board. Still, the military reserved the
right to appoint 270 UF of 360 senators, giving it full
control of the new government.
In the March 22 election, the opposition got most of the
votes. There were 15 parties with 2,740 candidates and out
of the country's 57 million inhabitants, 32 were eligible.
In early April, General Suchinda Kraprayoon was inaugurated
as Prime Minister. He had been chief of staff until then and
his government rested on a small coalition of 5 pro-military
parties. Out of his 49 ministers, 11 were accused of
financial fraud under the Chatichai government.
The following week, 50,000 people took part in a
demonstration called by 4 opposition parties demanding the
resignation of the government. At the same time, opposition
leader Chamlong Srimuang and 42 other opposition politicians
launched a hunger strike. In late May, the
government-hostile demonstrations ended in a massacre of
hundreds of killed and wounded. The military shot directly
into the crowd gathered at the Democracy Monument in the
middle of Bangkok. The demonstrations continued until King
Bhumibol surprisingly appeared on TV and called for national
reconciliation. At the same time, Suchinda gave his support
for a revision of the Constitution that would make it
necessary for the Prime Minister to be a member of
Parliament. Such a change would itself be disqualified as
prime minister with this change. Furthermore, Srimuang was
released, and amnesty was given to the many who had been
arrested during the street fighting. While there was a
curfew in Bangkok, parliament initiated the debate over the
constitutional amendment, and the king appointed General
Prem Tinsulanonda to oversee this process.