Thailand s political situation will remain highly volatile, and it is diffi- cult to envision political stability over the next few years. Following the recent coup in May, the roadmap to a return to civilian government is unclear, and we expect the political situation to remain very volatile over the coming years. ...Moreover, Thaksin is also accused of corruption and vote-buying. Judging from the disagreements regarding constitutional changes, such as the occasional street demonstrations, we view the schism between the two groups to - Business Monitor International Ltd www political outlook characteristics of society Weighing on ratings long-Term Political risk ratings Source: BMI be a gulf too wide to be bridged in the short term. Government efforts to reconcile the political interests of both sides in a bid to broker a peaceful resolution have achieved limited success in recent years. ...Thailand s scores a low --.- out of --- in our Long-Term Political Risk Ratings, which is below the regional average. With the constitutional framework still on shaky ground and no clear path towards reconciliation between the Red Shirts and the Yellow Shirts , it is difficult to envision Thailand enjoying political stability over the longer term.
...The Thai military s assumption of power following failed talks between rival factions in the ongoing political crisis raises the prospect of an un- elected government being installed. Such a move would risk a violent pro-government backlash, and we maintain our view that the path of least resistance is for escalating violent unrest. ...Such a move would risk a violent pro-government backlash, and we maintain our view that the path of least resistance is for escalating violent unrest. Just two days after the Thai military announced the imposition of martial law while stressing that the Pheu Thai Party (PTP) government would remain in power, failed talks between rival factions have resulted in the army s assumption of power, mark- ing the country s --th coup d etat in just over -- years. This also marks the third time in -- years that power has been taken away from the PTP by court rulings or coups. ...We cannot rule out a much more violent confronta- tion considering that tensions have been brewing between the opposing forces since then. civil War a Growing possibility In the event of the instalment of an unelected government, and a subsequent Red Shirt backlash, the risk of a civil war would - Business Monitor International Ltd www thailand Q- ----
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