This photo shows safety manager pointing up to workers painting the Thai oil company PTTEP Arthit CPP topside jack-up rig in Bangkok, Thailand.

All of the main political parties set to contest Thailand’s December 23 polls have vowed to ramp up spending and put the economy back on track. Yet the odds are against the country’s next democratically elected government lasting long enough to honor those populist pledges.
The Thai economy has slipped under the junta’s watch, lagging behind the economic growth rates seen in several other regional economies. Meanwhile, foreign investors have openly lamented the military-appointed government’s economic management since coupmakers seized power from deposed prime minister Thaksin Shinawatra in September 2006, ATIMES.COM reported.
Those complaints have centered on the decision to impose capital controls on equity, bond and currency transactions, the central bank’s unorthodox and restrictive handling of interest rate policy, nationalistic proposals for amending the Foreign Business Act and the politicized cancellation of certain state contracts and seizure of certain foreign-held assets.
The still unresolved political situation, including lingering concerns that the junta might backtrack on its previous promise to restore democracy through new elections, have weighed against local business and consumer sentiment. Private investment contracted in the third quarter, while whole segments of the local economy are in recession. Mobile telephone companies have reported for the first time ever declining usage rates.
Some economic analysts believe the Thai economy could slip further as a slowing US economy starts to drag on exports, which have recently been strong and contribute 70% of gross domestic product. There are concurrent concerns that spiking global oil prices will start soon to take a heavier toll on Thai industry, considering the country ranks as the largest oil importer as a percentage of gross domestic product (GDP) in Asia.
The poor economic news has been factored into political parties’ electoral strategies, with all of the main contenders avowing vigorous fiscal pump priming if elected. They have universally adopted Thaksin’s past successful campaign strategy, entailing promises of government handouts for the rural poor. While there is some financial space for more government spending, with official public debt at 37% of GDP and near 44% when including off balance sheet liabilities, the next government will be constrained by scheduled fiscal deficits of 1.7% and 1.8% of GDP for this year and next.
The previous opposition Democrat Party is promising to restore the country’s neo-liberal credentials and usher in a new era of economic optimism, by making amends with alienated foreign investors topped up with aggressive public spending. Democrat party leader Abhisit Vejjajiva has said that if his party wins enough votes to form the next government, he will
prioritize scrapping the current government’s capital controls policy.
Deputy party leader and former investment banker Korn Chatikavanij, who would presumably take the finance portfolio of any Democrat party-led coalition, said during a recent private presentation to foreign investors in Bangkok that he would aim to quickly ramp up infrastructure spending, including plans for at least three new mass transit train lines in Bangkok, a major renovation of the country’s decrepit railway system and an expansion of irrigation systems in rural areas.
The party is also offering a raft of populist spending policies, including a new universal education system, an extension of the low-cost universal health care scheme first implemented by Thaksin’s government, and other schemes targeting the rural poor. To finance those schemes, Korn said the Democrats will be willing to pump up public debt to between 55%-60% over the next five years.
That, of course, all rings familiar with the People’s Power Party (PPP), the newly formed incarnation of Thaksin’s disbanded Thai Rak Thai (TRT) party. The PPP says it plans to maintain the TRT’s past policies, including a heavy new dose of populist spending programs and a new push to follow up the ambitious infrastructure spending plans Thaksin first proposed but never implemented, which before the baht’s recent appreciation was scheduled to amount to about US$44 billion over five years.
The PPP’s populist programs include the continuation of the TRT’s former revolving village fund, a debt moratorium for farmers, as well as the establishment of a new so-called People’s Bank, which would be charged with providing start-up capital to budding rural entrepreneurs. The policies also include agriculture price supports, which historically have proved costly and done little to address underlying economic weaknesses in the rural economy. However, the policies are designed to give cheer to the PPP’s faithful supporters in the poor north and northeastern regions of the country, which proportionally accounts for about 260 of the Lower House of Parliament’s 480 seats.

Europe’s paternal trading relationship with African states threatens to end in an almighty family fall-out if they fail to sign the economic partnership agreements (EPAs) by the end-of-year deadline, reported Ipsnews.com.
European Union trade commissioner Peter Mandelson went on the offensive this week, accusing non-governmental organizations of ignorance or prejudice in wholly misrepresenting the aims of the deals.
The EPAs, he argues, are desperately needed by African, Caribbean and Pacific (ACP) countries to move out of poverty. So what is there not to like?
Aggressively promoted by Europe as necessary to meet its commitments under World Trade Organization (WTO) rules, but attacked by critics as a Trojan horse that could wreck Africa’s economic progress and do little for its political self-determination, the EPAs are likely to remain a bone of contention way beyond the January 1, 2008 deadline.
No one disputes that the preferential trade arrangements historically enjoyed by Europe’s former colonies are in need of reform. But it is contested whether reciprocal trade agreements in the form of EPAs will be an improvement.
The delays in the EPA talks have to a large extent been blamed on the EU’s inclusion of the so-called “Singapore issues“. A far-reaching set of institutional reforms that Europe linked to market liberalization, they were first introduced into trade negotiations by rich nations at the WTO meeting in Singapore in 1996.
The Singapore issues are new generation or behind-the-border regulatory reforms that address the areas of investment protection, competition policy, government procurement and trade facilitation. Developing states managed to get them off the WTO agenda, only to find them reintroduced in the bilateral EPAs.
While the EU has since agreed that concluding the trade in goods section of the EPAs by the year-end deadline would be sufficient, the Singapore issues will remain on the table for conclusion later on.
They involve a raft of provisions, the implications of which may not be fully appreciated by many African countries, says Dr Sanoussi Bilal, coordinator of the European trade co-operation program for the European Centre for Development Policy Management (ECDPM). He was an observer during recent EPA negotiations.
Bilal has deep reservations about the pace and extent of the EPAs, which, he says are in danger of being passed by default. Even of central Africa, the region closest to concluding the deal, he remarks: “I don’t know if they understand what they are signing.“
ECDPM is just one of a number of non-government organizations (NGOs) concerned that EPAs are a “blank cheque“ for European business to profit from African economies without guaranteeing a positive balance sheet for development in return. Bilal says even signing a goods-only trade agreement at this stage may be leaving some African countries hostage to fortune.
In particular, NGOs highlight concerns over the transfer of intellectual property rights, foreign direct investment (FDI) in service sectors such as banking, transport, communication and energy markets, and the liberalization of government procurement procedures, a b�te noir for Europe, often accused of being a cloak for corruption.
While the main plank of the EU argument is that economies outside of the ACP are growing at a faster rate than those within the group because they are more attractive to foreign investors, NGOs counter that FDI can bring costs as well as benefits.
Indeed, some elements of the EPAs are prescriptive enough to restrict African countries’ ability to strike strategic deals. Opponents talk of a loss of policy space, which may limit pursuit of development objectives outside of the EPA regime.
Some are as critical of opportunities missed as much as liberties taken, particularly in the fraught legal area of intellectual property rights, arguing that potentially positive measures around intellectual property rights are absent from the EPAs.
These include the transfer of technology, joint ventures, prevention of biopiracy and misappropriation of traditional knowledge by EU companies.
But that involves a level of detail way beyond the capacity of many of the resource-restrained African negotiators to fully engage with, says Dr Mareike Meyn, research officer in the international economic development group at the Overseas Development Institute, based in London.
Bottom-up, bespoke documents are needed to take into account African states’ different levels of economic development, rather than a top-down template for reform, says Meyn.

Credit card spending could well be simply delaying rather than preventing a slowdown in US economy.

October saw more sharp divergence on the world’s stock markets between the good, the bad and the plain ugly.
As reported by BBC, into the ugly category, of course, would go Merrill Lynch, whose disastrous mishandling of its exposure to the US sub-prime mortgage market drove its shares down 11 percent last month--they’ve fallen by a third over this year.
Merrill is not a member of the Global 30, but its misadventures have tainted all financial institutions in the US. Citigroup fell 11.1 percent in September. The S&P 500 share index, which includes a number of financial firms, was down 4 percent in the same period, while the US component of the Global 30 is up 1.1 percent.
The other big issue is the falling dollar, pushed lower by two US interest rate cuts. This has created in some parts of the world what might be called “bad“ stocks.
The greenback’s fall has been most keenly felt by European companies. Politicians, most notably French President Nicolas Sarkozy, have been banging the exchange rate drum, saying their exporters are being punished unfairly.
However, Japan, because investors are borrowing there to take advantage of the low interest rates, has seen the yen barely move. But every few weeks or so, Japanese investors start to get a fit of jitters over whether the currency is about to go shooting skywards.
In that sort of nervousness, exporters have had a rocky time, with Canon down 8.6 percent and Toyota losing 6.7 percent. The 13 percent fall in Takeda Pharmaceutical has a different story behind it.
The question of whether the US economy is slowing down or not is giving economists endless cause for argument.
“Just when I think the economy is about to nosedive, I am constantly amazed at the American consumer’s ability to open up their bottom drawer and, hey presto, find another credit card to keep on spending with,“ said Justin Urquhart-Stewart of Seven Investment Management.
But that, in itself, could well be simply delaying rather than preventing a slowdown.
One of the most inexorable pressures on the economy is rising commodity prices.
Proctor & Gamble (P&G) shares slid back 5.2 percent in October, despite good results, for this very reason.
P&G products--everything from Gillette shavers to Tide detergent--depend heavily on energy and commodity prices, and there is barely an analyst on the planet who thinks they are coming down in the foreseeable future.
The heavy equipment maker, Caterpillar, went so far as to say that it could cause a recession in the US next year. Yet a number of businesses disagreed.
Chemicals maker Du Pont said it was feeling fine, thank you. Third-quarter net income was up 8.5 percent and the weak dollar was doing wonders for its exports, particularly in Canada and Latin America.
You can see what Caterpillar was driving at, though, Du Pont’s sales in the US fell 1 percent.
And now for the good--although many might say the word “good“ cannot realistically be applied to what they consider to be a Chinese market bubble.
One of the popular themes in the market is “decoupling“, with the Chinese and Indian economies motoring along on their own independently of the US. No-one really believes it, but a lot of people talk about it.
“I don’t believe the US has decoupled from Asia, and a slowdown or recession there will still have dampening effect on the bubbles in China and India, and that’s no bad thing,“ says Urquhart-Stewart.
But China and India’s market performance suggests the bubble is not over yet. Five of the 10 largest companies in the world by market value are now Chinese, with only three being American.