Tarrin cautious despite lack of public interest
THE opposition may have accumulated damaging information against the Krung Thai Bank by trying to link the scandals to Finance Minister Tarrin Nimmanahaeminda, but the public is looking forward to the holiday season rather than the political talking shop that may spoil their festive celebrations.
Still, Tarrin seemed cautious ahead of today's censure debate against the government in general and against him in particular. He made it clear yesterday that there was nothing to worry about at KTB since he would be in a position to answer any queries.
Although his brother, Sirin, was president of the bank for seven years, he should not be linked to Tarrin in any way, since wrong-doings, if there were any, would be the business of the present management or the Bank of Thailand. The Sirin-Tarrin link-up has been a delicious political meal for the opposition over the past four to five months. The issue has been kept alive until the no-confidence debate so that the government's credibility in tackling the financial system and putting the economy back on track is destroyed in one fell swoop.
Tarrin is a little luckier that Sanan Kachornprasat, the interior minister, will also become a fat target for the opposition attack. The censure will revolve around the three luxury villas on national reserve land connected to Sanan and around politicians close to him who played a role in helping Wolfgang Ullrich, a German of questionable background. But Tarrin cannot afford to stay complacent, for he may become the prime target.
There are two interesting events that have coincided with the no-confidence debate. First, Thai authorities, with the help of their US and British counterparts, have been able to nab Pin Chakkaphak, the former take-over king, in London. Pin, until his arrest a few days ago, had been on the run for more than two years. Pin's arrest and the extradition charges against him helped divert attention from the KTB scandal. This high-profile case makes the government look good, giving the impression that it is serious about restoring law and order.
The Thai authorities had spotted Pin in New York, London and Hong Kong, but each time it appeared that Pin had a magic eye and ear which helped him to narrowly escape the law. This time, with the government's survival at stake, it would have been difficult if Pin had remained at large, or so it seems.
Another event was a PR blitz by the management of KTB to defend its reputation. Yesterday Singh Tangtaswas waved a white paper issued to clear up any public doubts about KTB. Since the bank may become a sacrificial lamb for the political wolves to swallow, Singh thought it needed to defend itself. This was justifiable, but it may not hit the spot.
The white paper outlined the role of KTB, its performance over the past 10 years, the underlying reason for its non-performing loans, its progress in debt restructuring and the process of internal investigation. It also covered PricewaterhouseCooper's controversial report on KTB, the status of the 10 debtor groups and 140 groups whose names were leaked to the press and the outcome of the Kamchorn Sathirakul panel's investigation.
The white paper sought to give background information to the public ahead of the censure debate. This will stop Tarrin having to spend too much time on background information and let him focus his defence on the main points.
The KTB management also came up with another assurance that the bank's problem loans, including those of First Bangkok City Bank, amounted to Bt539.52 billion or 56.7 per cent of total loans in the first nine months of 1999. The NPLs of KTB alone stood at 51.3 per cent.
Singh has been going great guns to refute PricewaterhouseCooper's report, which stated that the bank's NPLs totalled 84 per cent, a figure that shocked the whole world of banking. If KTB's NPLs are 51.3 per cent, it is not so different from Bangkok Bank, whose NPLs could have easily peaked at 50 per cent, so where did the scandals come from if not from the fabrications of politicians or those who do not wish KTB well?
However, nothing in the white paper, or Tarrin for that matter, addressed public doubts as to who should take responsibility for the Bt300-Bt400 billion worth of damage at KTB. This is a simple enough question. For before a bail-out in this scale can take place, there must be someone responsible for the damages. Who is this someone?
As long as this question is not answered directly, the KTB scandal will continue to rock the government.
Tarrin yesterday sidestepped questions on how he would defend himself in the KTB affair but insisted that he would take the opportunity to inform the public how the government had so far been able to tackle the economic crisis. He added that the economy was well on course forf recovery and that the poor had been protected by government spending on social safety nets, which had created jobs and lessened the impact of the crisis.
There was another coincidence that went against the government. Social critic Thirayuth Boonmee conducted a public-opinion survey before painting the government in the blackest hue, accusing it of belonging to the same class as the Thanom-Prapas tyrants. He charged that the government had neglected the plight of farmers, favoured the bankers and protected the bad guys.
Thirayuth's charges were serious because this former student leader was very good at timing his political comments to set the tone for the public debate. He said the Chuan government was following the ''ninja principle'', meaning it was elusive.
However the debate unbfolds, it will prove to be a critical juncture for the government as it has been in power for more than two years and all eyes are on the elections to be held under the new Constitution. If the Democrat-led government survives the debate, foreign investors are likely to renew their confidence in Thailand and will pour investment into the country once the Y2K hurdle is cleared.
If the government does not survive the censure debate, the economic-recovery programme is in jeopardy. For political instability is one of the main obstacles that have prevented Moody's Investors Service, the US credit-rating agency, from upgrading Thailand's sovereign risk. There is a big national stake in this censure debate. Watch out for a surprise!
BY WICHIT CHAITRONG and