Post by : Raman

Photo : Reuters

Thailand is entering a period of political uncertainty after Prime Minister Paetongtarn Shinawatra was removed from office on Friday. Analysts warn that this move could lead to a fragile government, a possible early election, and even raise the risk of a military coup. The sudden change in leadership also threatens to worsen the country’s already fragile economy.

Paetongtarn’s Dismissal

Paetongtarn Shinawatra was dismissed for an ethics violation following a suspension in July. The suspension came after a leaked phone call between her and former Cambodian Prime Minister Hun Sen became public. In the call, she criticized a Thai military commander handling a border dispute with Cambodia while appearing to appease Cambodia’s leader.

The border dispute between Thailand and Cambodia had escalated in late July, though a ceasefire was reached after five days of clashes. Despite the ceasefire, tensions remain high, and Paetongtarn’s removal has fueled uncertainty about Thailand’s political future.

Short-Term Political Chaos

Joshua Kurlantzick, a senior fellow for Southeast Asia and South Asia at the Council on Foreign Relations, told analysts that Thailand could face “chaos in the short term.” One possible outcome is that Paetongtarn’s ruling Pheu Thai Party might try to hold together its slim majority in Parliament. However, this majority is fragile and could collapse at any moment.

If this happens, a weaker placeholder prime minister, such as Chaikasem Nitisiri—who is also part of the Pheu Thai Party—could take office. Nitisiri previously ran for prime minister in 2019 and 2023 and served as Thailand’s justice minister in 2013.

Another possibility is the formation of an unstable coalition led by another party, such as the Bhumjaithai Party, with support from the People’s Party, formerly known as the Move Forward Party. However, Kurlantzick warned that such coalitions rarely work effectively and may struggle in Thailand’s political system.

Coalition Shifts and Party Decisions

The People’s Party was expected to meet early Monday to decide which party to support in forming the next government. The Bhumjaithai Party had already left Paetongtarn’s governing coalition on June 18 after the phone call with Hun Sen was revealed. Bhumjaithai leader Anutin Charnvirakul reportedly negotiated between parties, offering promises such as calling for an election within four months.

Analysts from Nomura said Charnvirakul has a lower chance of becoming prime minister than Nitisiri. The Bhumjaithai Party has about 70 fewer seats than Pheu Thai in Parliament. If Nitisiri becomes prime minister, the current Pheu Thai-led government will largely remain in place. However, there is a risk of early elections in 2026 due to the coalition’s small majority and rising political uncertainty.

Nomura analysts added that even new elections may not solve Thailand’s political problems and could extend the uncertainty further.

Risk of a Military Coup

Political instability in Thailand also raises the possibility of another military coup. The country experienced coups in 2006 and 2014. In 2006, the military ousted Paetongtarn’s father, Thaksin Shinawatra. In 2014, a coup followed the Constitutional Court’s removal of Yingluck Shinawatra, Thaksin’s sister.

Kurlantzick explained that if Parliament collapses, a snap election will likely be called. However, the military and the king may see a free election as a threat. In a snap election, the progressive Move Forward Party—led by Pita Limjaroenrat—would have a strong chance of winning a majority and selecting the next prime minister. This, according to Kurlantzick, would be “a disaster for the military and palace.”

The Move Forward Party had won the most seats in the 2023 general election but was unable to form a government. The party was dissolved in August 2024 for violating the Constitution by proposing changes to Thailand’s lèse-majesté law.

Experts warn that the military may see a coup as the only way to prevent a government that challenges its control. A December 2024 report from the Center for Strategic and International Studies noted that Thailand’s military, monarchy, and elite groups often see electoral democracy as a threat. They consider themselves guardians of national stability and sometimes believe the largely rural electorate is unprepared for political decision-making. This mindset has contributed to repeated military interventions to maintain the status quo.

Economic Uncertainty

The political crisis is already affecting Thailand’s economy. Analysts warn that instability may slow economic recovery, which is already struggling with tariffs and weak market performance. Thailand’s SET Index has fallen 11.7% year-to-date, signaling market volatility and investor caution.

Radhika Rao, senior economist at DBS Bank, said that economic growth in Thailand has been “on the softer side,” though the central bank is expected to cut interest rates to support growth. She also warned that the second half of 2025 may see further economic slowdown.

Nomura analysts forecast a gross domestic product (GDP) growth of just 1.8% for 2025, in line with the World Bank’s July downgrade. The World Bank reduced Thailand’s full-year growth forecast from 2.9% to 1.8% and projected 1.7% growth in 2026, down from 2.7%. Thailand’s economy grew 2.5% in 2024.

Political uncertainty and weak growth have also raised the risk of a sovereign credit rating downgrade. Moody’s currently rates Thailand at Baa1 with a negative outlook, citing both political instability and economic weakness. Analysts warn that if uncertainty continues, the country’s borrowing costs may rise and foreign investment may slow.

Potential Scenarios Ahead

Thailand now faces multiple possible scenarios:

1. Weak Pheu Thai-led Government: Nitisiri may take over as a placeholder prime minister. This could maintain the status quo but may not provide long-term stability.

2. Unstable Coalition: Another party or coalition could attempt to form a government, but the chances of success are low given historical precedents.

3. Early Elections: A snap election may be called if Parliament collapses, but it may prolong uncertainty and political tension.

4. Military Intervention: If political instability worsens, there is a possibility that the military may intervene to protect its influence and the monarchy, repeating Thailand’s history of coups.

Economists warn that all these scenarios could continue to affect investor confidence, consumer spending, and overall economic performance.

Thailand is now at a crossroads. The removal of Prime Minister Paetongtarn Shinawatra has exposed deep political fragility, raising fears of a weak government, early elections, or even a military coup. At the same time, the economy faces growing challenges, with low growth, market volatility, and the risk of a credit rating downgrade.

Experts warn that the coming months will be crucial for Thailand. Political leaders, the military, and the monarchy will all play key roles in determining the country’s stability. Meanwhile, ordinary citizens and businesses are left to navigate uncertainty that could affect every aspect of life in Thailand, from governance to the economy.

With its history of political upheaval and military intervention, Thailand’s path forward remains uncertain. Analysts emphasize that careful leadership, dialogue, and governance reforms will be essential to restore confidence and ensure both political and economic stability.

Thailand political crisis, Paetongtarn Shinawatra, Thailand PM removed, Pheu Thai Party