Stunning Political Upset in Thailand

July 4th, 2011
in econ_news

Yingluck Econintersect:  The 44-year old sister of former and exiled ex-premier Thaksin Shinawatrahas will be Thailand's next prime minister after her party scored aclear victory.  Yingluck Shinawatra, a political newcomer, will come to power after her Phue Thai party won 264 of 500 parliament seats in Sunday's election.  This is the second election since a military coup in September, 2006 removed Thaksin from office and sent him into exile in Dubai, where he remains.  Yingluck will replace the Democrat Party Prime Minister Abhisit Vejjajiva after that party won only 160 seats.

Follow up:

From The New York Times:

Ms. Yingluck, a businesswoman with no political experience, was selected to head the party by her brother, who called her his “clone.” She proved to be a brilliant campaigner in the election, which will give Thailand, a major American ally in Southeast Asia and one of the region’s most important economies, its first female prime minister.

The vote is a vindication for Mr. Thaksin, 61, a populist champion of Thailand’s long-marginalized rural poor, who was elected prime minister twice, in 2001 and 2005, and removed in a coup in September 2006.

Thaksin was been charged with corruption during the 2006 coup and those charges are presumably still pending.  The Phue Thai party has mainatained that the charges were political fabrications.

The clear victory for the Pheu Thai party is expected to provide Thailand with an immediate financial dividend.  From Reuters:

"Winning by a big margin would ease the problem of the military intervening and make it easier for them to form the government and implement all their policies," said Kongkiat Opaswongkarn, chief executive of broker Asia Plus Securities.

"We expect a jump when the stock market opens and this is because it is a big win, with less risk of having the military meddling with politics."

The baht rose more than 1 percent against the dollar Monday, outperforming other Asian currencies.

Sources: The New York Times and Reuters

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