Protest risks are on the rise in Thailand

03 December 2018

Thailand is set to hold general elections in early 2019, but the military will continue to wield significant influence in politics. Protests may cause some operational disruption ahead of the elections, and a separatist insurgency in the south of the country is set to continue. Thailand’s economic growth will be supported by robust public investment, but there is a risk that a new civilian administration could revoke contracts signed by the military government.

Security Environment

After over four years of military rule, Thailand is set to hold long-delayed general elections in the coming months. The vote is likely to take place in February 2019 but could be further postponed until May 2019. While the elections are expected to lead to a return of civilian government, General Prayut Chan-o-cha is likely to remain as prime minister and the military will retain control over the Senate.

Protest risks are likely to rise ahead of the elections. Thai politics remains highly divided between supporters of former prime ministers Thaksin Shinawatra and Yingluck Shinawatra, known as ‘Red Shirts’ and anti-Thaksin ‘Yellow Shirts’. 

The latter grouping is formed of royalists and nationalists, and maintains close ties with the military. In the run-up to next year’s elections Red Shirts are likely to face restrictions on campaigning, raising protest risks. Protests may cause some operational disruption, but are unlikely to reach the levels seen in 2010 or 2013-14. 

In 2010, protests by 100,000 Red Shirts were disrupted by the army, leading to 91 deaths. Protesters also set fire to commercial assets and government buildings, leading to around USD 1 billion in property damage.

Terrorism risks are elevated in Thailand, with the country experiencing multiple improvised explosive device attacks (IEDs) throughout 2017. 

A separatist insurgency in the south means that risks are particularly elevated in Narathiwat, Pattani and Yala. In the one-year outlook insurgents will continue to target security forces with IEDs and firearms attacks, but may also target commercial assets and tourist destinations. Attacks are likely to continue in the medium-term outlook, as peace talks make limited progress. 

However, a more sizeable military presence and martial law in southern Thailand will moderate risks, and should ensure a lower death toll from insurgency attacks. In 2017 the death toll from the insurgency was at its lowest level since violence began 13 years ago.

Trading Environment

Thailand’s real GDP growth is forecasted at 4.0% in 2018 and 3.7% in 2019, but an outbreak of civil unrest surrounding the elections remains a risk and would weigh on investor sentiment. The trade dispute between the US and China shows no signs of abating, and a slowdown in their economies would weigh on Thailand’s exports and tourism sector. 

However, Thailand is set to maintain robust levels of public investment as part of its National Economic and Social Development Plan, while private consumption reached a five year
high in Q2 2018.

Sovereign credit risks are relatively modest, as general government debtto-GDP stands at just under 33%, and Thailand adheres to fiscal rules that cap the proportion of public sector and foreign-currency debt. In addition, the current account remains in surplus and foreign-exchange reserves are set to rise to USD 220 billion in 2018. The threat of political instability and rising US interest rates pose downside risks, but the baht is unlikely to face significant depreciatory pressure in the 12-month outlook.

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Investment Environment

The new government is likely to continue to prioritise infrastructure investment via public-private partnerships, but contractual risks are moderately elevated ahead of the general election. While the risk of expropriation is low, a new administration may revoke contracts agreed under the military government, particularly in the infrastructure and transport sectors. 

Thailand’s legal system is one of the more effective in the region at enforcing contracts, which the World Bank estimates takes an average of 440 days at a cost of 19.5% of the claim. However, corruption is commonplace in Thailand and the performance of the judiciary is undermined by a high incidence of bribery.

 Protest risks are on the rise in Thailand   

In this month's Risk Outlook, we also provide a detailed forward looking assessment of developments within the security, trading and investment environments for Brazil, Indonesia, Ukraine and Thailand all of which have been the subject of recent enquiries from JLT's client base.


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The monthly Risk Outlook is supported by JLT’s proprietary country risk rating tool, World Risk Review (WRR) which provides risk ratings across nine insurable perils for 197 countries. The country risk ratings are generated by a proprietary, algorithm-based modelling system incorporating over 200 international sources of data.

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For further information, please contact Eleanor Smith, Senior Political Risk Analyst on +44 (0)121 626 7837 or email

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