THAILAND: Thailand’s voters have approved an army-drafted constitution but a hefty “No” vote suggests December’s general election will be messy, with ousted Prime Minister Thaksin Shinawatra still a potent political force. 

With 98 percent of votes counted on Monday in Thailand’s first referendum, the Election Commission said about 57 percent of people had accepted the charter, designed to prevent a repeat of Thaksin’s powerful single-party style of government.

However, 41 percent rejected it, sending a signal to the generals who removed the telecoms billionaire in a coup last September they will struggle to control the make-up of the next administration.

Roughly 25 million of the 45 million electorate cast their ballots, a 56 percent turnout.

Having pressed for a “Yes” vote, the army-appointed post-coup government had been hoping for at least a 60 percent turn-out for what will be the 18th charter in 75 years of on-off democracy.

After early exit polls indicated overall approval — a result that was never really in question — Prime Minister Surayud Chulanont said elections would “definitely be held at the end of the year”. Dec. 16 or Dec. 23 are the most likely dates.

Thaksin, 58, has been in exile in Britain since the coup and spent Sunday afternoon watching his newly acquired soccer club, Manchester City, beat Manchester United 1-0 in a match that generated as much interest back home as the referendum.
Many Thais, especially those in Bangkok, appeared motivated to vote by a desire to see an end to the turmoil that has reigned since Thaksin’s family sold control of the telecoms empire he founded to Singapore for a tax-free $1.9 billion in January 2006.

Analysts said investors would also be relieved there had been no major upset, although the smaller-than-expected margin of victory for the “Yes” camp suggested the election would be closely fought, messy — and dirty.

“This is telling the junta that they are going to have trouble at an election and that could mean all kinds of attempts to influence the result — and that’s worrying,” Bangkok-based political analyst Chris Baker said.

Even though Thaksin’s Thai Rak Thai (Thais Love Thais) party has been disbanded and 111 top members barred from politics, its leaders hope the mass rural support that twice swept it to power will rally to a new party under a new flag.

Voter breakdowns showed a 62 percent “No” in the Thaksin heartlands of the northeast, suggesting the army’s campaign to discredit him and his dissolved party has failed.

Analysts say the charter is designed to restore rule by the elites challenged by Thaksin, son of an ethnic Chinese silk merchant, and rekindle the “managed democracy” of the 1980s under ex-army chief Prem Tinsulanonda — now the King’s top adviser and seen by the Thaksin camp as the coup mastermind.

Human rights groups have criticised the poll as a sham, given that nearly half of Thailand’s 76 provinces remain under martial law and that a “No” vote would have allowed the army to impose any one of the previous 17 constitutions.

A full official result was expected later on Monday.

THAILAND: Internet law experts and webmasters have lashed out at the government’s illegal blocking of websites and the use of threats and intimidation tactics against webmasters. 

Paiboon Amornpinyokiart, an internet and IT law expert, said nowhere in the controversial Cyber Crime Act — which was pushed through by the military-appointed government and took effect on July 19 — does it say the government has the authority to freely block websites. The law says any move to block a website must be backed by a court order.
 
He said the Information and Communications Technology Ministry (ICT) had to first seek court orders if it wanted to block any “undesirable” websites. The Cyber Crime Act was passed through the National Legislative Assembly along with a number of other controversial bills this year, despite grave concerns raised by local and international human and media rights groups.
 
The president of the Thai Webmasters Association, Poramate Minsiri, said most of the content of the new law had been altered during the deliberation in parliament and was acceptable to him.
 
But, he said, the unchecked blocking of websites by the government without court approval was now a major problem.
 
Webmasters have received phone threats and other various forms of intimidation from officials criticising content on their websites and threatening to ban them, he said. Mr Poramate also said the officials intimidating them had refused to reveal their names.
 
He said webmasters had provided software programs such as Ultrasurf to internet users to reverse the blocking but had then been told off by the ICT for distributing the programs.
 
Mr Poramate said ICT officials should carefully study the scope of their authority permitted under the new computer crime law and alter their actions accordingly.
 
Chiranuch Premchaiporn of www.prachathai.com, a website providing information on social and political issues, said the government’s rush to issue media-related laws shortly after the Sept 19 coup was grossly inappropriate.
 
The draft Radio and Television Broadcasting Bill, currently being deliberated, has also drawn widespread criticism for the heavy punishments it will impose on radio and television operators who operate without state permission.
 
She said community radio operators would be badly affected by the draft bill as most operate without licenses.

TOKYO : Asian stocks reeled from another huge sell-off Friday with Tokyo plunging by the most in over seven years as panicky investors dumped shares to escape the snowballing credit crisis.

Heavy selling on Asia’s largest bourse quickly spread across the entire region with major markets down more than five percent as investors scrambled to exit the market fearing further heavy losses.

Japanese share prices closed with a massive 5.42 percent loss, suffering the biggest one-day point drop since April 2000.

Around Asia, stock markets also plunged as investors remained extremely nervous that more bad news might emerge from US credit markets.

For Asian markets the main worry is that foreign investment funds will be forced to further offload shares to cover losses in securities backed by US sub-prime mortgages to risky borrowers, or to stash funds in more stable bonds.

Hong Kong share prices were down 6.0 percent in afternoon trade before rebounding to close 1.4 percent lower.

Singapore tumbled more than 5.0 percent as investors fretted that problems in the US mortgage sector could spark a full-blown credit crunch.

It also bounced back on bargain hunting and ended 0.68 percent lower.

Seoul closed down 3.1 percent, Shanghai finished down 2.28 percent, Mumbai was off 1.5 percent, Kuala Lumpur fell 1.3 percent, Manila ended two percent lower, Sydney was down 0.70 percent and Wellington was off 1.63 percent.

Only Bangkok bucked the trend at 1.03 percent up amid hopes voters will support a new constitution at Sunday’s referendum.

ASIA: Bruised Asian stock markets suffered another drubbing on Friday, spiraling ever lower as panicky investors continued to dump shares with no end in sight to the recent turmoil on global markets. 

An early rally on some markets quickly fizzled out as Tokyo set the region up for another nasty fall, with Japanese shares briefly down over four percent by early afternoon as a stronger yen pummeled exporters.
 
Investors fled “the crashing stock markets and headed to the safer bond market,” said Akihiko Inoue, a strategist at Mizuho Investors Securities.
 
Hong Kong slumped 3.30 percent, sliding below the key 20,000 points level, while Singapore tumbled 3.4 percent as investors fretted that problems rippling out of the US mortgage sector could spark a full-blown credit crunch.
 
“It’s hard to believe that all the skeletons are out of the closet,” said Eric Betts, an equity strategist at Nomura Securities in Sydney.
 
“Some of these (firms’ problems) will only come to light if their lenders pull the plug on them or force them to come clean,” he added.
 
For Asian markets the main worry is that foreign investment funds will be forced to further offload shares to cover losses in securities backed by US sub prime mortgages to risky borrowers, or to stash funds in more stable bonds.
 
Overnight on Wall Street, US shares fell deep into the red again before recovering much of the losses to close slightly lower after another extremely volatile day, while the London market tumbled by over four percent.
 
In Tokyo a stronger yen dimmed prospects for Japanese exporters’ future earnings, while uncertainty about whether the Bank of Japan will raise interest rates next week kept investors on edge.
 
An unraveling of risky “carry trades” that have allowed investors to binge on cheap Japanese credit to invest in fast-growing Asian stock markets appeared to be taking a heavy toll around the region.
 
The yen shot higher against other major currencies as players scrambled to unwind risky positions and send funds back to Japan.
 
Around the region markets were buckling again under heavy selling.
 
Singapore lost 3.44 percent, Mumbai was down 1.63 percent, Shanghai slipped 0.71 percent, Bangkok declined 1.03 percent while Kuala Lumpur fell 2.5 percent and Manila ended two percent lower.
 
Seoul dipped 0.3 percent after plunging nearly seven percent Thursday — its biggest ever one-day point decline. Sydney dipped 0.6 percent.
 
“It is too early to say that the bout of correction is completely wrapped up,” said Woori Investment & Securities analyst Kang Hyun-Cheol in Seoul.
 
The Australian and Japanese central banks injected extra liquidity into the banking system again Friday to try to calm markets but the focus of investors remained on events overseas.
 
Overnight on Wall Street the Dow Jones index ended lower for a sixth straight day, but pared back steep losses to end down 0.12 percent as the market tried to find a bottom.
 
The stock gauge had pitched to a more than 10 percent loss from its record intra-day trading peak of 14,021.95 on July 17 after American investors received a double dose of bad news tied to the housing market. 
 
The US government reported that new home construction dived to a 10-year low in July, and Countrywide Financial — America’s leading mortgage lender — said it had tapped an 11.5-billion-dollar credit line to boost its finances. 
 
European stock markets took another dive Thursday, led by London where the FTSE 100 index of leading shares closed down 4.10 percent, its biggest fall since March 12, 2003, shortly before the outbreak of the Iraq war.

INDIA: Indian Prime Minister Manmohan Singh’s independence-day speech yesterday should come as a huge disappointment to investors. 

The country’s 60th anniversary of independence from Britain was a perfect opportunity for Singh to make up for lost time and announce bold, new economic freedoms, something that his government has shied away from granting the people in the three years that it has been in power.

He missed the chance.

Singh uttered the word “reform” — India’s official shorthand for all plans that seek to modernize the economy and loosen state controls — just once in his speech, and that too in the context of fixing university education.

By contrast, Singh’s predecessor, Atal Bihari Vajpayee, had used the word 13 times in 2000.

The only tangible takeaway for investors from Singh’s uninspiring address is that his government already has the 2009 polls on its mind.

Why else would the prime minister of the world’s second- fastest-growing major economy celebrate a proud and unique moment in the nation’s history with a lament that included as many as 15 references to poverty?

One hates to be a cynic, but a simple analysis of independence-day speeches seems to suggest that concern for the plight of the downtrodden follows a cyclical pattern in India.

It rises when general elections are near and ebbs once they are out of the way.

Gloomy Speech

On the six occasions Vajpayee had addressed the nation from the historic Red Fort in Delhi, he used the words “poverty” and “poor” a combined 27 times. Out of these, as many as 24 mentions occurred in the three independence-day speeches immediately preceding the May 2004 election, which he lost.

Singh isn’t taking any chances.

“Even after years of development and rising growth rates, why have we not been able to banish mass poverty and provide employment to all?” Singh asked his countrymen yesterday, adding that the purpose of his rhetorical question was “not to make you feel dispirited, but to enthuse you to march forward.”

It isn’t the people of India who need to be prodded into action; it’s the politicians that need to wake up. Almost everyone outside of the political and administrative establishment is already marching forward as best they can.

The creative solutions invented by people to make a living are visible on every street corner, though they may not always make for a pretty picture.

State-Sponsored Penury

In smaller towns of the northern Indian state of Uttar Pradesh, it’s common to find pushcart vendors who will replace — even repair — your soiled, torn currency note for a fee. They call themselves “money exchangers.”

Why do the people of India have to be engaged in such desperate, hopeless businesses 60 years after the end of colonial exploitation? Why can’t the world’s biggest democracy, which has done an incredible job of nation-building, find better uses for its people’s enterprise?

Official estimates suggest that between 22 percent and 28 percent of Indians live below the poverty line, which is defined as per-capita consumption expenditure of about 40 U.S. cents a day in urban areas.

While the ratio of poor people in the population has steadily declined for three decades, there’s no denying that 28 percent of 1 billion people translates into a huge challenge.

It’s not that Indians have chosen to live a life of penury; impecuniousness has been thrust on them by an uncaring state that isn’t even now willing to give them the freedoms they need to find a job or run a business.

Endless Wait

Take the country’s overly restrictive labor laws, which discourage hiring by making it extremely difficult and expensive to fire workers. As a result, a majority of workers have to toil in informal, extralegal businesses where they have no rights.

Based on a survey of about 2,000 retail stores across India, World Bank economist Mohammad Amin recently concluded that scrapping the country’s rigid labor laws would boost employment by 22 percent for an average store.

With retailers employing 9 percent of the workforce, the gains in employment would surely be significant for the economy as a whole. Yet, a plan to amend the labor laws has awaited political consensus since 2001.

Similarly, large-format global retailers are being prevented from investing directly in Indian stores, out of a misplaced concern for the small local shopkeeper, curtailing yet another opportunity for employment creation and economic growth.

Finance Suffers

Change is perhaps the slowest in the financial sector, where the opportunity for India is probably the largest.

Insurance, pensions and banking remain heavily state-owned, state-controlled and, therefore, tiny compared with what an economy the size of India’s really needs.

A committee established by the government has come up with a bold road map for turning Mumbai into an international financial center. The least Singh could do was to endorse the strategy in his speech so that it would be taken seriously as part of the executive’s political agenda.

But then, in his speech, Singh even forgot to claim credit for what may well become the single-biggest victory of his political career: the recently concluded civilian nuclear agreement with the U.S. That deal may be getting the Indian prime minister brickbats from politicians of all hues, but it’s also winning him praise from businessmen who are impatient for an end to the country’s acute shortage of electric power.

If only Singh had strived for a great speech, instead of a safe one.

Commentary by Andy Mukherjee in Singapore

CEBU CITY: A tourism industry executive said the Philippines could become the top tropical destination in Asia by marketing the country through Cebu, which has a flourishing tourism industry.

“It’s easier to market the Philippines through Cebu,” said Angel Ramos Bognot, president of the National Association of Independent Travel Agencies Philippines.

Bognot said Cebu is the “vortex” of Philippine tourism and luring more foreign tourists through the province will not be difficult given its positive reputation in the international market.

“It’s like selling infant’s milk formula. You only tell them one thing good about the product like it boosts brain development and it sells,” Bognot said.

“Cebu is indeed a world class destination. It’s a tourism magnet,” she added.

She said growth in tourism-related developments—such as the entry of international hotel operators, increase in the volume of foreign visitors and additional flights to and from Cebu—only proves interest among travelers and businessmen in Cebu is growing.

She said it would be easier for tour operators to create inter­island linkages and tourism packages because of Cebu’s strategic location to the rest of the country.

Neighboring provinces like Bohol, Negros Oriental, Pala­wan, Samar and Leyte are already benefiting from the spill over of tourists from Cebu.

“If Manila is for business, Cebu is for leisure,” Bognot said.

THAILAND: Quality office space in Bangkok is the cheapest in Asia now that the average rent declined quarter-on-quarter for the first time since 2000, according to the international property consultancy CB Richard Ellis. 

The average rent for prime office space in Bangkok’s central business district is slightly more than 740 baht (US$22) per square metre per month, compared with the equivalent of 2,000 baht in Singapore, 1,480 baht in Ho Chi Minh City and 4,500 baht in Tokyo.

International Financial Centre Tower 2, the highest building in Hong Kong, has attained a record rental of about 7,400 baht.

Nithipat Tongpun, director and head of office and retail services at CBRE Thailand, said the slowing economy was expected to push rental rates in Bangkok even lower in the near term.

The company projects that the downward pressure on rental rates could further increase at the end of the year when new grade-A supply enters the market. There are 520,000 sq m of new supply in the pipeline from 2007 to 2009, or about 173,000 sq m a year.

However, the situation could reverse if business confidence is restored, when new demand would exceed increased supply.

Mr Nithipat said demand had fallen because of a weak domestic economy and uncertainty involving the proposed amendments to the Foreign Business Act to control foreign investment in the services sector.

Many overseas companies have delayed expansion and there has been limited new foreign investment in the services sector.

”This has resulted in occupied offices falling dramatically. New net take-up of office space fell by more than 30% in the first quarter on a year-on-year basis, the lowest quarterly take-up since 2000.”

THAILAND: Senior Thai judges issued arrest warrants for the ousted prime minister Thaksin Shinawatra and his wife yesterday on the grounds that they sought to evade corruption charges over a multi-million dollar land deal.

The former leader, who recently acquired Manchester City football club for £81.6m, was deposed in a bloodless coup in September while he was abroad. He has since been living in exile in London and failed to appear before a hearing scheduled to begin yesterday.

The nine-judge panel of Thailand’s supreme court ordered the telecoms billionaire and his wife, Pojaman, to be produced before the court at the next hearing scheduled for September 25. Prosecutors said afterwards that if Mr Thaksin failed to appear by the new deadline then extradition proceedings would be considered.

However, an extradition request to British authorities would have virtually no hope of success. British law has no charge equivalent to that which Mr Thaksin, 57, is facing under Thai legislation. Foreign governments are also usually reluctant to extradite former heads of state where there are suspicions of political persecution.

The couple are accused of being involved in a $22m land deal to buy a prime piece of Bangkok real estate in 2003 while Mr Thaksin was prime minister, in contravention of laws barring serving officials and politicians engaging in business with state enterprises.

In the wake of the coup, an “assets examination committee” established by the military-appointed government investigated the purchase of land from an arm of the Bank of Thailand at an auction in which other bidders dropped out.

If convicted, Mr Thaksin faces up to 10 years in jail. The committee is demanding the purchase be set aside, the land returned and the money confiscated.

The former prime minister’s lawyer, Pichit Cheunban, argued that because of the political uncertainty in Thailand it was not safe for his client to return, though his wife has travelled in and out of the country often and is currently in London.

The lawyer argued that Mr Thaksin’s reappearance in Thailand would merely destabilise the fragile political situation ahead of elections that the coup leaders have pledged by December.

He added that it would be impossible for Mr Thaksin to receive a fair trial while the junta was still in control and urged that the case be postponed until next year, or until at least a month after the elections.

“I have talked with my two clients and we agree that the best timing for them to return to fight the case is after the election,” Mr Pichit said after the ruling. “We reiterate that the current situation is still not good for their safety and we have no desire to see disunity in the country.”

In his initial reaction to the Thai court’s decision, Mr Thaksin gave a non-committal response to the Associated Press.

“I am aware of the decision in Thailand,” he said in a statement. “I shall consult with my legal advisers and make an announcement in due course.”

The army chief, Sonthi Boonyaratglin, who led the coup, said Mr Thaksin’s safety would be guaranteed if he returned, directly contradicting an earlier statement that the former premier might be at risk from his enemies.

“The [National Security Council] has to be responsible and the government has to ask the police to take care of it with the military playing a supporting role,” he said. “There should not be any problem for him to return. Everything has gone in accordance with the Assets Examination Committee and court process.”

Since June, almost $2bn of Mr Thaksin’s assets have been frozen in Thai bank accounts. The tycoon was already a wealthy businessman before he secured two terms in office between 2001 and 2006. But the tax-free sale of his telecoms empire to the Singapore government’s investment arm in 2006 sparked mass street protests that led to his eventual downfall.

The Thai military, which justified its takeover on the grounds that Mr Thaksin was corrupt, vilified the former prime minister, but took almost eight months to bring the first charges against him.

THAILAND: In football crazy Thailand, Dr. Thaksin Shinawatra’s purchase of Manchester City Football Club is nothing short of political genius.

Whilst Thailand’s Military Junta ponder what to do next as the country rapidly falls into economic and political chaos, the famed exiled leader Thaksin Shinawatra is having a ball – literally. Thaksin is pouring on the charm in his adopted country England and known affectionately by Manchester City fans as “Frank Sinatra”.

To add to his growing popularity, the former Thai Prime Minister hosted a concert attended by more than 8,000 people in Manchester’s main square on Saturday – his first major public appearance since he was ousted in a military coup last year.
Surrounded by players from the soccer team he recently bought, Manchester City, Thaksin addressed the cheering crowd outside Manchester Town Hall.

Before the event, Thaksin said he had no plans to attempt a political comeback in Thailand. However, he said the event would demonstrate the strong levels of support he has back home and in England, where he lives in self-imposed exile.

‘The people in Thailand, the majority of them, are still supporting me,’ Thaksin said after watching his first Manchester City game – a 1-0 defeat of Spanish team Valencia in a preseason friendly.

‘If there were to be free and fair elections, my party would win again because this is the first time in Thai history that they have overthrown a very popular government,’ he said.

Thaksin thanked the club and Manchester for accepting him.

‘I feel very honoured and touched by the type of reception I have received from you all today,’ he said.
Thaksin endeared himself further to the crowd by closing the concert – which featured popular Thai singer Mai Charoenpura – singing the club’s anthem Blue Moon.

Mr Noi Ramasut, a friend of Thaksin’s for 40 years, predicted the images of the event broadcast in Thailand would reinvigorate supporters of his Thai Rak Thai Party, which was disbanded by a court ruling in May in a bid to eradicate the former premier’s political influence.

‘He doesn’t want to create conflict now. He will wait for it all to calm down,’ said Mr Ramasut, who moved to Britain in 1973 from Bangkok. ‘This event will make a lot of people feel alive and feel he is present and his future in Thai politics is alive and well.’