Thai political uncertainty could have ramifications for new investments
Foreign companies are closely monitoring the political situation in Thailand but they assured that they were continuing to invest in Thailand despite the political uncertainty, according to different sources.
They want the next government to pursue a policy of energy independence and sustainable energy to create a conducive environment for long-term business growth.
Foreign investors have been concerned about the delay in the formation of a government since the May 14 general election. Thailand is grappling political uncertainty after Move Forward, the party that won the most seats, failed to form a government as its prime minister candidate, Pita Limjaroenrat, failed to win a parliamentary vote. The uncertainty has led to foreign investors slowing down their investment plans.
The political stalemate has been aggravated by multiple petitions filed in the Constitutional Court, which could have a bearing on voting in Parliament.
Louis Blanchot, the chief executive officer of Etix Everywhere, a data centre service provider from France investing in Thailand through its subsidiary, ETIX Bangkok #1 Data Centre, said the company closely monitors the political situation in Thailand. He said they understand the nature of the democratic system, which can undergo constant changes. As an economic stakeholder, he said they comprehend the importance of being involved and supporting the democratic process.
He said the company’s concern goes beyond business profits and extends to the well-being of the Thai people, believing that a thriving democracy is essential for the country's development and prosperity.
He pledged the company’s commitment to conducting their business responsibly, not only for economic gains but also to contribute to advancing the digital economy in Thailand.
Blanchot said Etix believes the current election will lead to a stable political environment, benefiting both the Thai people and foreign businesses and investors. The Thai government has implemented policies to support investment in the digital economy. Consequently, the company has invested over 350 million baht in Thailand this year, reiterating its confidence in Thailand's potential to become a digital hub in the region.
The government's new policy to support businesses, such as enabling the trading of renewable energy and investing in private sector clean energy, is expected to lead to sustainable economic transformation. The company's operations have already reduced carbon dioxide emissions by over 35%, further aided by the government's support, Blanchot said.
The Federation of Thai Industries (FTI) president, Kriengkrai Thiennukul, said that the private sector was closely monitoring the political situation. He said existing Thai and foreign investors might adopt a wait-and-see approach due to their familiarity with Thailand's social and political landscape. However, new foreign investors that Thailand is wooing from the New S-Curve group, specialising in high-tech technology, especially from the US and Europe, might be more cautious as the competition in the region intensifies.
Kriengkrai hoped that the election of the new prime minister would be concluded swiftly so that the government could be formed within the designated timeline, which the business sector considers crucial. If it takes longer than 10 months, as proposed by a political party, it would need to be assess whether the country can bear the impact and risks.
Overall, the Thai economy is already fragile, and there are multiple risks from the global economy, he said, adding that a delay in forming a government had increased the uncertainty. Foreign investors might assess the situation in the coming months to determine the country's stability and whether they should proceed with their investment plans, Kriengkrai said.
