The ‘Ukraine of the (Far) East’?

Analysts watching the escalating tension in Thailand have started to warn that things could easily grow as bad there as Ukraine, and with far more significance to US business.

Thailand is a key economy in Southeast Asia and figures far more prominently in the US economy than does Ukraine. The economy is three times the size and a major trading partner for the US. The role Thailand plays in the region is second only to China. As such, it is baffling that almost no attention is being focused on the Thai situation

The tensions in Thailand have existed for many years and, periodically, they spill out in the form of some temporary violence in the streets that seem to subside briefly enough. This time may be different, as there seems no desire on the part of the players to engage with one another. For the first time, there are those who are seriously considering a division of the nation into two parts—a rural north and an urban south. The disputes that have resulted in government paralysis revolve around the fact these two parts of the country are at odds with one another on a constant basis. Thailand started to split over the issues of the north vs. the issues of the south, and that has intensified in the last year.

The calls for support for the current leadership are mixing with those that call for actual secession. Right now this seems a remote possibility given the centuries of Siamese unity, but many would have said the same about Ukraine until recently. The two sides in Thailand are not negotiating with each other either, and that deepens the animosity. The army has yet to step in, but that is always a possibility in Thailand.

All told, the division of the country will not likely take place in a formal way. But the divisions are severe enough to challenge the economy and could compromise growth for years.

- Chris Kuehl, PhD, Armada Corporate Intelligence

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