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DE RUEHBK #2943/01 2701035
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UNCLAS SECTION 01 OF 02 BANGKOK 002943 
 
SENSITIVE 
SIPDIS 
 
STATE PASS TO USTR 
 
E.O. 12958: N/A 
TAGS: ECON EFIN PGOV PINR TH
SUBJECT: MIXED REVIEWS FOR NEW PM SOMCHAI'S ECONOMIC TEAM 
 
REF: A. BANGKOK 2927 (ROYAL ENDORSEMENT) 
     ¶B. BANGKOK 2899 (NEW APPOINTMENTS) 
     ¶C. BANGKOK 2357 (RESHUFFLED CABINET) 
     ¶D. BANGKOK 409 (NEW CABINET) 
 
BANGKOK 00002943  001.2 OF 002 
 
 
¶1. (SBU) Summary: Prime Minister Somchai's selections for his 
Cabinet's economic team have come under attack from the local 
press and business community.  Controversial appointments 
include the placement of former Interior Minister Chalerm 
Yubamrung at the Ministry of Public Health, former Police 
Chief Pracha Promnok at the Ministry of Industry, and others 
who do not appear to have any particular qualifications for 
the jobs.  Aside from the placement of MIT-trained economist 
Olarn Chaipravat as Deputy Prime Minister in charge of 
economic policy, our contacts in the business community 
believe that Somchai assembled an uninspiring economic team 
because he was unable to attract any economic heavyweights 
willing to give up their lucrative private sector 
affiliations, or put their personal reputations on the line, 
for a seat in what all observers believe will be a 
short-lived government.  This group will likely be 
administrators, rather than leaders -- unlikely to push 
forward any new initiatives.  End Summary. 
 
ONE BRIGHT SPOT 
--------------- 
 
¶2. (SBU) Deputy Prime Minister Olarn Chaipravat, who will 
manage the new government's overall economic policies and 
likely oversee the Ministries of Finance, Industry, Commerce 
and Energy, has been hailed as Somchai's most positive 
selection for his economic team.  An economist who trained at 
the Wharton School and MIT and former president of Siam 
Commercial Bank (SCB), Olarn is respected in the Thai 
financial world.  He was considered several times for cabinet 
positions in previous governments, but this is Olarn's first 
foray into the cabinet.  Olarn was criticized for his 
aggressive investments while president of SCB prior to the 
1997 financial crisis ) actions that resulted in his 
resignation.  Olarn was one of former Prime Minister 
Thaksin's primary economic advisors and the director of 
several state enterprises during his administration.   The 
Bangkok press speculates that Thaksin was behind his 
appointment. 
 
¶3. (SBU) Finance Minister Suchart Thadathamrongvech happily 
accepted a promotion from his former position as Deputy 
Finance Minister during the Samak Administration.  However, 
banking leaders we talked to expressed nervousness at 
Suchart's appointment, not so much over his lack of 
experience but rather over his temperament.  Suchart gained 
some notoriety in the banking community when he called for 
the resignation of Bank of Thailand (BOT) Governor Tarisa 
Watanagase after the central bank raised interest rates in 
July and August.  A leader of a Thai commercial bank noted to 
econoff that Suchart's "very un-Thai" public criticism of the 
BOT Governor does not bode well for Suchart's ability to 
attract, or at least calm, international investors.  Suchart 
reportedly is a strong follower of the economic views of 
newly-appointed Deputy Prime Minister Olarn Chaipravat and 
Virabonga Ramangkura, a chief economic advisor to former 
Prime Minister Samak, and shuns the views of others who 
disagree. 
 
SOME RETURNEES, A MIXED BAG OTHERWISE 
------------------------------------- 
 
¶4. (SBU) Some familiar faces from the Samak administration 
survived the jockeying among the various political parties in 
the ruling coalition (ref A).  Chaiya Sasomsap and Santi 
Prompat will remain at the head of the Ministries of Commerce 
and Transport, respectively.  Others who will continue 
include Information and Communications Technology Minister 
Mun Patanotai, Labor Minister Uraiwan Theinthong, and 
Minister of Science and Technology Wuthipong Cahiseaeng.  The 
rest of the economic team is an odd mix that even Somchai 
himself characterized to the press as "mismatched" -- 
Wannarat Charnnukul, a medical doctor who received his 
Master's in Public Health at the University of Hawaii, was 
appointed Minister of Energy, for example. 
 
¶5. (SBU) Industry Minister Pracha Promnok, another puzzling 
choice, is a former Chief of the Royal Thai Police with no 
background in trade, commercial or economic affairs.  Our 
 
BANGKOK 00002943  002.2 OF 002 
 
 
business contacts at the Thai Chamber of Commerce expressed 
concern over how Pracha will function as the new Minister of 
Industry with so little business experience.  He was a 
prominent police officer for many years known for his social 
development and outreach in poorer regions of the country and 
entered government in the Thaksin coalition in March 2002 as 
the Deputy Minister of Public Health. 
 
¶6. (SBU) Somchai's most controversial pick on the economic 
front was firebrand ex-cop Chalerm Yubamrung as Public Health 
Minister.  Largely viewed as a divisive politician, Chalerm 
was former Prime Minister Samak's first Interior Minister 
before he was displaced in the August Cabinet reshuffle. 
With no health background or experience, his views on key 
public health issues, such as compulsory licenses to break 
pharmaceutical patents, remain unknown. 
 
¶7. (SBU) Our contacts in the business community believe that 
Somchai assembled an uninspiring economic team because he was 
unable to attract any economic heavyweights willing to give 
up their lucrative private sector affiliations, or put their 
personal reputations on the line, for a seat may be a 
short-lived government.  It is unlikely that this 
"mismatched" group will push forward any new economic 
initiatives, but rather will maintain the status quo with 
similar positions as the previous Samak administration. 
JOHN