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Nationalism is the last refuge of bankrupts

NATIONALISM is a recurring theme, manifesting itself with the vicissitudes of a country. It may be played up by a lone voice, by a group of people or by a national body, all trying to appeal to the sentiment.

Last week Prachai Leopairatana, the beleaguered chief executive officer of Thai Petrochemical Industry Plc, could not help but drum up nationalist sentiment. This happened when he realised that he was about to lose control of his debt-ridden company, which was declared insolvent and placed under court receivership.

Prachai had been painting his foreign creditor banks as predators. They were simply interested in chopping his company into pieces, without taking into consideration the jobs of 2,000 Thais or the importance of the petrochemical giant to the Thai economy as a whole. With his back against the wall, Prachai had nowhere else to turn but to make an emotional appeal. In the process, the Leopairatana family's petrochemical business somehow became a national asset. So it would be unthinkable to allow this national asset to fall into foreign hands.

Just listen to what he had to say last Friday, two days after the fateful court verdict. "The court decision is okay with me," he said. "I will make another try. It's good if I can make it. If not, all the assets will fall into the hands of the foreigners. That's all," he added almost sarcastically.

Almost at the same time, a Nation Rescuing Club emerged literally from nowhere to slam the Chuan government for its plan to privatise the Bangkok Metropolitan Bank and the Siam City Bank. Their message was: the country has already suffered greatly under the economic crisis, so why do the Thais have to suffer more?

One of its chief spokesmen, Dr Suchart Thada-Thamrongvech, associate professor at Ramkhamhaeng University's Economics Department, accused the government of selling off the country on the cheap. The acquisition deal, he charged, was structured in such a way that foreign banks would run virtually no risk in taking over the two Thai banks since any future losses would be borne by taxpayers' money.

He also called for the government to make public the details of its sale of the Nakornthon Bank to Standard Chartered Bank of the UK and Radanasin Bank to the United Overseas Bank of Singapore. He and his group have been periodically going on national TV to attack the government's liberal policy, masterminded by the International Monetary Fund, which they claimed would eventually result in foreigners taking control over all aspects of the Thai economy. How could Thailand survive then?

But nationalism found its staunchest voice in the Senate, whose term expired on March 21, 2000. Over the past two years, the hawkish but powerful Senate, under the presidency of Meechai Ruchuphan, have made the loudest claims for its stand on the national interest. In the old days, the Senate used to be a rubber stamp for the government because members were appointed by the prime ministers. But this Senate was no ordinary legislative body. It represented the last bastion of Thai conservatism, although some members were dubbed "NPL senators". Prime Minister Chuan Leekpai had to confront them or seek compromise before getting bills passed.

At the height of the debate on the bankruptcy and foreclosure bills in March 1999, the Senate campaigned fiercely against the government's tough laws, which its prominent members believed would turn Thai debtors into the slaves of foreign creditors. At that time, nationalist sentiment reached a fever pitch. Were we about to pass laws that would give the country away to foreigners? It was not until a compromise was struck that the bills, significantly watered down, were passed to provide a bankruptcy framework that would allow corporate debt restructuring to proceed.

The conservative or nationalist voice of the Senate was concentrated in the Senate Subcommittee on Fiscal, Banking and Financial Institutions. Between March 1998 and March 2000, it published nine economic reports, each voicing its disagreement over the IMF-prescribed financial and economic reform programme. Together these reports represented a conservative manifesto of modern Thai economics. Dr Virabongsa Ramangkura was the subcommittee's foremost intellectual. He did not see the point of sticking to international standards when doing so would result in turning Thai assets over to foreigners. While the government banked on a return of foreign capital to boost the economic recovery, Virabongsa called for Thais to help themselves or do things the Thai way because the foreigners were not coming back anyway.

With the expiration of the Senate, the conservative mainstream has lost its voice. But nationalism is not going away easily. It will continue to pop up as long as the economy withers under the weight of the past policy mistakes.




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