Chairman’s Note

Private and Confidential
For SIIA Corporate Members and Advisors
17 September 2025

Political Development in Thailand

Several of you have asked about recent developments in Thailand. While the political situation remains complex, past SIIA commentary after the 2023 elections prove largely accurate. We anticipated that the Future Forward Party would be blocked from forming a government, that Pheu Thai and the Shinawatras would be weakened, and that the Bhumjaithai Party (BJT) would emerge as a new pro-establishment force.

Recent events reinforce our analysis. The Shinawatras are diminished, with PM Paetongtarn dismissed and Thaksin ordered to serve jail time. The rebranded Future Forward (now the People’s Party) still holds the most seats, but the BJT will form government under Anutin Charnvirakul. While elections are promised shortly and this will be an interim government, the potential implications could be significant.

Please allow me to share my views —based on engagements with key figures in various Thai factions — in confidence with you as our supporter.

1. The Fall of the Shinawatras: Even when Thaksin returned and Paetongtarn became PM, I did not believe the Shinawatras were triumphant. They came second in the 2023 elections and served largely to block the Future Forward. Once in power, Pheu Thai struggled. Economic performance was weak, signature policies were scaled back, and Thaksin’s interference and dominance further alienated the establishment. In provincial elections in early 2025, the Pheu Thai underperformed. Public support for Paetongtarn plummeted from 30% in March to just 9.2% by June. The controversial phone call with Cambodia’s Hun Sen merely provided an excuse.

2. People’s Party: Playing the Long Game: The clear winner of the 2023 elections, the Future Forward Party, has been limited by constitutional and legal checks. Rebranded as the People’s Party, it won just one seat in the 2025 provincial elections (Lamphun). Nevertheless, the party continues to be popular among urban voters and playing a long-term strategy, staying in opposition and focusing on constitutional reform. Its support for BJT forming a minority interim government is tactical—meant to enable some legislative progress and to demonstrate its willingness to compromise. The decision was not welcome by all members. They expect to perform strongly in the next election, especially with Pheu Thai’s declining support.

3. BJT: Establishment’s New Power Center: BJT has capitalized on both Pheu Thai’s decline and the establishment’s refusal to accept a People’s Party government. Anutin has positioned himself well, having served under both the Prayut and Pheu Thai governments, proving his utility across divides. BJT’s influence was evident in the 2024 Senate elections (creating a “blue bloc”) and the 2025 provincial polls, which favored local leaders aligned with the party. Anutin’s ties to the Palace and out-performing the military-backed Palang Pracharath have elevated him to a key pro-establishment role. Scion of a political family, his long-standing ambition to be PM has now materialized; whether he can deliver remains to be seen.

4. What Comes Next: Officially, this is an interim government with a four-month term and another three to four months for election preparations. But there’s speculation Anutin may extend his tenure. Elections aren’t legally required until June 2027. He may try to stay in power or gamble that BJT can perform well in elections – perhaps second – to form the next government. Currently, BJT faces legal scrutiny, including land deal investigations, which they’ll want resolved while in power. The other key is to show initiative and capability. The cabinet choices named so far are credible, non-political technocrats—e.g., Ekniti Nitithanprapas as Finance Minister, former PTT CEO Auttapol Rerkpiboon for Energy, and former Foreign Ministry permanent secretary Sihasak Phuangketkeow. This suggests a priority to show competence, especially on economic growth and finance while also managing border issues with Cambodia and Myanmar.

5. Economy and Finance: Thailand’s economic situation is weak. GDP growth is projected at just 2% and foreign investors have withdrawn some US$2.5 billion from its markets. A sharp drop in tourism is hurting consumption. Finances are constrained for government, many large conglomerates and at the household level. Youth unemployment and stagnant wages, even for graduates, add to concerns. Structural issues like demographic decline and reduced competitiveness in sectors such as internal combustion engine cars also weigh on the economy. Still, Thailand retains core strengths and remains a key player in a number of global supply chains. Expect finance to be a focus for early efforts to restore economic confidence. An incoming Bank of Thailand governor, while independent, may be more aligned. For indebted households, efforts can be expected to rein in illegal moneylenders and increase legitimate micro-finance.

6. Political Colors and Temperature: The rise of Anutin and the BJT and its compromise with the People’s Party marks a possible evolution in the long-standing Yellow vs. Red divide. Thaksin’s resilience, however, should not be underestimated. Serving jail time could help gain sympathy or at least lessen complaints against him. Most observers do not foresee mass unrest or prolonged protests like in the Yellow vs. Red years, nor the upheaval seen in Indonesia or Nepal. If BJT stabilizes governance and shows some progress while the People’s Party adjusts to political realities, there’s room for improvement from the current low point.

Thailand’s politics is complex and remains opaque at the highest level — given the Palace’s powerful influence. As always, I welcome your views and insights. Please feel free to reach out if you wish to discuss further.

Yours sincerely,

Simon Tay
Chairman