Stimulus from poll put at Bt25 billion

November 23, 2000

AT least Bt25 billion will flow into the economy from the campaign funds of political parties and some 5,000 candidates between now and when the general elections are held, says a report by SG Securities.

This sounds like income distribution in the fast lane, if not another Thai version of the Miyazawa stimulus package, Bt50 billion of which has been sown into the social safety net programme over the past three years.

The election campaign money "should help improve slightly the purchasing power of people in the rural sector in the short-term", says the SG Securities report.

Speculative stocks that might benefit from money politics include Big C Supercenter, Siam Makro, BEC World, Matichon, Nation Multimedia and Post Publishing, its says, adding that media companies, in particular, should profit from an increase in advertising revenues.

Thai politicians poured in about Bt20 billion to help clear their path to Parliament in the last election, held in November 1996, according to estimates by the Thai Farmers Research Centre. That election campaign was dubbed the most expensive in the country's history.

"We have not yet made the estimate [for this year] because we would like to wait until November 24 [tomorrow] when all the candidates have filed their registrations," a Thai Farmers Research Centre official said.

"We think that the amount of money for political campaigns is likely to be similar to the last general election," the official said.

This time round, however, a number of factors will curb money politics.

First, politicians are likely to be more careful about how they spend money as the Election Commission (EC) is empowered to issue a red card to, or disqualify, any candidate found to have bought votes.

Second, the economic crisis has depleted the coffers of some candidates. Also, money previously generated from the stock market is no longer forthcoming because of the market slump.

Third, the new election rules have narrowed the constituencies, so that the elected MP will have more time to devote to the people they represent. This will make campaigning less costly for candidates.

"Besides, the party list system now introduced for the first time will lead to a voting pattern based on political parties. This will also reduce the campaign costs for individual candidates," said the Thai Farmers Research Centre official.

If all the Bt25 billion is spent during this election campaign, it might not contribute to a significant improvement in domestic consumption.

With the rules put in place by the banking authorities to curb money laundering, people have become more cautious about depositing their money with the banks. Depositors are now required to fill in a bank form when moving Bt2 million or more into any bank account.

BY THANONG KHANTHONG