Pheu Thai Party Faces Possible Dissolution Amid Political Turmoil
Published: 22 Oct 2024 at 05:52
Recent developments in Thai politics signal potential instability for the Pheu Thai Party as the Election Commission (EC) has accepted a case claiming internal dominance by former Prime Minister Thaksin Shinawatra. Analysts warn this situation may also affect the Stock Exchange of Thailand (SET), which recently saw its index fluctuate around the 1,500-point mark.
Political tensions escalated following the EC’s decision to entertain a petition seeking the dissolution of Pheu Thai. Independent lawyer Thirayut Suwankesorn filed the complaint, urging the Constitutional Court to act against Mr. Thaksin and the ruling party for allegedly undermining the constitutional monarchy and violating Article 49 of the Constitution.
The EC deemed the complaints valid and established a committee on October 18 to investigate the matter, which could lead to the party’s dissolution.
Key allegations against Pheu Thai involve concerns over Mr. Thaksin’s possible influence on the party’s internal dynamics and its impact on Thailand’s constitutional monarchy, according to Rakpong Chaisuparakul, senior vice-president of KGI Securities (Thailand).
“Further developments regarding the political complaints against Pheu Thai are expected in the coming weeks,” he stated.
On the global front, tensions intensified as Chinese President Xi Jinping instructed his military to prepare for a possible conflict, likely relating to rising tensions with Taiwan. Observers note that investors are closely monitoring these developments.
Additionally, a recent survey indicates that Republican candidate Donald Trump is gaining ground against Kamala Harris, raising concerns over potential implications if he wins the upcoming U.S. election.
In the Middle East, geopolitical tensions are anticipated to escalate amid ongoing conflicts between Israel and Iran, which could adversely affect oil supplies.
“The interplay of Thai and international political factors is currently creating headwinds for the stock market,” Rakpong noted.
According to Asia Plus Securities (ASPS), the EC’s investigation into Mr. Thaksin and Pheu Thai is expected to wrap up within 30 days, with the possibility of a further extension of the same duration.
If the EC determines that Pheu Thai must dissolve, the case will then be forwarded to the Constitutional Court for further deliberation. Following these political uncertainties last Friday, the SET index declined from a peak of 1,506.82 points to close at 1,489.82 points.
“The stock market is projected to experience volatility while awaiting the court’s decision, particularly in light of ongoing foreign fund outflows,” ASPS concluded in a research note.
