Judgment Day for Thaksin

BANGKOK — Politically troubled Thailand faces “Judgment Day” on Friday when the country's Supreme Court rules on what to do with US $2.26 billion frozen in ousted Prime Minister Thaksin Shinawatra's family bank accounts.

The nub of the allegations are that Thaksin transferred his wealth to family members to sidestep a rule that he could not hold company shares while in office. It is also alleged that while in office, Prime Minister Thaksin implemented policies that were of commercial benefit to businesses controlled by him. The charges include his dealings with the military junta in Burma, alleging that state loans were extended to the regime to finance a deal with a company then under the control of his family.

Thaksin supporters hold his portraits as they gather at the Royal Field in Bangkok last year. (Photo: AP)

The case appears to be the first of its type in Thailand. A foreign diplomat in Bangkok said that the case is complex and difficult to second-guess. Speculation is that some or all of the one-time telecom entrepreneur's assets will be seized, or some could be seized and some remain frozen, perhaps with with a final decision left pending for another day. We will know on Friday when the judges read the verdict.

Worries abound that seizure of Thaksin's assets could be the spark for demonstrations like those that forced the cancellation of an April 2009 summit of Asian leaders in Thailand, which could prompt a violent counter-reaction. How the police and army respond to the demonstrations is cause for worry among the public and politicians.

The government has massed some 20,000 security forces in the capital in the lead-up to the verdict. Even before the ruling is announced, Thaksin supporters have pledged to demonstrate in March.

Thaksin's Redshirt supporters have vowed to topple the current government, which they view as an illegitimate usurper put into place by the military coup. Redshirts claim that they will get a million supporters onto the streets in March, for what they say will be peaceful protests.

Thaksin supporters are perhaps wary of overdoing demonstrations to close to the date of the ruling, given that the violence in Bangkok and around the Asian summit last April caused a jump in support for the government. Opponents snipe that the Redshirts' delayed demonstrations illustrates that Thaksin has lost much of his popular support.

For his part, Thailand's Oxford-educated PM Abhisit Vejjajiva hopes the court ruling will calm the situation and enable Southeast Asia's second-largest economy to get back to normal after four years of violent clashes between Thaksin supporters and opponents, punctuated by a coup in September 2006.

A recent return to economic growth, after a difficult 2009, could be jeopardized by ongoing instability amid more intense competition from Vietnam, Indonesia and Malaysia. Industry Minister Chanchai Chairungruang recently said that many investors have expressed their concern over possible violence, but investors should be well-used to political upheaval in Thailand, with 11 coups, 6 failed coup attempts and 27 prime ministers since 1932, when absolute monarchy was ended.

Others note that the Australian, British and American governments are among 27 countries already warning citizens to remain aware of the situation in Thailand.

In recent weeks, the Redshirts have talked in ominous but vague terms about a “people's army,” which some opponents think is code for arming civilian militias in pro-Thaksin regions close to the Laos and Cambodian borders. The government too has been fear-mongering, hyping “10 days of danger” and deploying what jurists regard as Thailand's heavy-handed security laws in response to the situation.

On Feb. 14, a bomb exploded near Government House, while a similar device planted near the Supreme Court was successfully defused. No one has claimed responsibility for the incidents.

Other leaks allege that one or the other side has tried to bribe the judges who will rule on the case, hinting that no matter what the decision, people will allege foul play, thus sowing the seeds for further unrest.

One month ago, military vehicles were seen on Bangkok streets, sparking rumors that the army— always influential and perhaps worried that instability could lead to a political outcome not to their liking—was about to launch a coup.