Political tensions hurting Thai economy

The Associated Press

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By SUTIN WANNABOVORN –

BANGKOK, Thailand (AP) — Anti-government street protests and rumors of a military coup are hurting Thailand’s economy and investors’ confidence, the finance minister said Monday as the stock market dropped 2.8 percent.

Protesters were back on the streets for an eighth day of demonstrations to demand the resignation of Prime Minister Samak Sundaravej and his coalition government.

On Saturday, Samak threatened to send in the police and military to clear them away, but he backed down Sunday.

The demonstrators, led by a group called the People’s Alliance for Democracy movement, charge Samak with being a puppet of toppled Prime Minister Thaksin Shinawatra and with trying to change the constitution for political gain.

“I admit that the problem of protesters during the past week has affected the economy and investor confidence,” Finance Minister Surapong Suebwonglee told reporters.

The benchmark SET index, which has fallen five out of the last six days, fell Monday by 2.8 percent to 810.22.

“I am explaining to them (investors) that the protests will not lead to violence or a military coup,” Surapong said, adding that the army commander told him that “no soldier wants to stage a military coup.”

The military toppled Thaksin in 2006 following months of protests by the alliance and other groups who accused Thaksin of corruption and destroying democracy in Thailand. After months of exile, Thaksin returned to Bangkok earlier this year to face corruption charges against him and his family.

Samak’s party, which won a general election last December, is widely seen as a proxy for Thaksin.

One of the protest leaders, Chamlong Srimung, said Monday that the demonstrators will not relocate from their positions near the United Nations building in Bangkok as the government has demanded.

“We are staying here until the nominee government is out of office,” Chamlong said as he supervised workers who were setting up a permanent stage for protest speeches.

The finance minister said there was no justification for the dissolving of Parliament or the resignation of the government.

Thailand’s economy has already been recently stung by high inflation, a strong baht currency and rising fuel prices. The stock market began a downward slide last week.

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