Thailand's Abhisit: Early Poll Likely

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By COSTAS PARIS and JENNY PARIS

(Posted by CAAI News Media)

SINGAPORE - Thailand's Prime Minister Abhisit Vejjajiva said Saturday that he will likely call early elections after the economy has firmly recovered.

"The likelihood is that there will be early elections once the economy is firmly grounded," Mr. Abhisit told Dow Jones Newswires. "The early poll could be called any time," he said, declining to specify a timeframe.

Calling early polls would help legitimize the rule of Mr. Abhisit, who was selected by Thailand's Parliament late last year after top army leaders helped broker the formation of a new coalition government. If Mr. Abhisit's Democrat Party and its coalition allies secure a majority in parliament, it could help turn down the heat on years of turmoil in the country, which is badly split between supporters and critics of former prime minister and telecommunications magnate, Thaksin Shinawatra.

Since being ousted in a military coup in 2006, Mr. Thaksin has continued to rally his supporters from overseas, where he is evading imprisonment on a conflict of interest conviction -- an allegation he denies.

Last week, he visited neighboring Cambodia, and dozens of supporters crossed the border to meet with him. Relations between historic rivals Thailand and Cambodia further soured when Cambodian Prime Minister Hun Sen appointed Mr. Thaksin as his economic adviser, and the two countries have recalled their ambassadors over the incident. Mr. Thaksin left Cambodia Saturday aboard his private jet.

Mr. Abhisit said Mr. Thaksin still has "a lot of support, but he should accept the consequences of his actions and take responsibility for breaking the law."

Speaking on the sidelines of the Asia-Pacific Economic Cooperation forum in Singapore, Mr. Abhisit said he expects Thailand's export-driven economy to contract 3% to 3.5% this year as it absorbs the full impact of the global financial crisis, but a rebound is likely next year, potentially enabling him to call fresh elections. "3.5% growth is achievable," Mr. Abhisit said.

Mr. Abhisit said he will continue to help exporters to help nurture that recovery, and suggested he believes the Bank of Thailand, Thailand's central bank, won't raise interest rates any time soon and put further upward pressure on the country's baht currency.

The weakening U.S. dollar has been a recurring theme at the APEC talks -- especially the way China's yuan has tracked the greenback down to undermine Asia's other export-led economies.

Thailand's central bank is among many in Asia that have been selling their currencies for dollars in recent months. "All we can do is to stop excessive volatility, and we have to adapt," Mr. Abhisit said. "For China, or any other government, having a misaligned currency serves nobody. So, eventually it will be corrected."

The central bank has bought $15 billion so far this year to curb the local currency's rise, Finance Minister Korn Chatikavanij told Dow Jones Newswires Wednesday, adding that the weakness of the yuan will likely require further intervention by Asia's central banks.

Write to Costas Paris at costas.paris@dowjones.com and Jenny Paris at jenny.paris@dowjones.com