Only if we can learn from the wisdom of others

The Stock Exchange of Thailand index fell on the possibility that China’s economy will suffer a slowdown. Investors dumped shares in PTT Exploration and Production, due to the dilution effect arising from its massive recapitalisation plan. Post Publishing seems to be on the verge of another change in its shareholding structure, with the share price moving in an unusual manner.

This is happening amid a changing landscape at the international level. There have been reports that the International Monetary Fund may not extend further aid to Greece, while a German official mentioned that the possibility of Greece leaving the euro zone “has lost its horror”. Indeed, if this does not lead to an eventual break-up of the euro, some economists have envisioned the time drawing near when the monetary zone will shrink. 

Kobsith Silapachai, head of Capital Market Research of Kasikornbank, said recently that, in time, European leaders will realise that “to treat cancer in the terminal stage, they need an operation to have the chunk of bad tissue removed.”

Some economists in Europe think it is time to erase the discrepancy that undermines the euro zone’s strength: countries that cannot demonstrate strengths to match Germany’s should not remain in the zone, as the single currency will only widen the gap. A decade ago, investors turned a blind eye to that. But when bad times come, they see through the problems. That’s the reason why, though using the single currency, Spain and Italy have to shoulder nearly 7 per cent in annual interest, against some 2 per cent in Germany. Given its public debt of nearly US$2 trillion, Italy will see its debt burden increase by 7 per cent a year, or some $140 billion. Just servicing the interest cost, it has few options left for investment. 

There is now talk that the peripheral countries will be the first to leave the euro, for the survival of all.

Somehow, this reminds me of a famous quote by late US President John F Kennedy: “Geography has made us neighbours. History has made us friends. Economics has made us partners, and necessity has made us allies.”

At a time when neighbours behave poorly but keep asking for loans, would you still keep your door open when you have greater responsibility for your children? 

Even before the collapse of the euro, the global market witnessed a big change in capital flows. As Europe falls into the abyss and the US economy suffers from fragile recovery, global funds are flowing to Asia seeking higher returns. This will strengthen Asian currencies and dampen the profitability of exporters who are reeling from lower demand in the western economies. 

At the Thailand-ADB-IMF Conference on “Towards a More Stable Global Economic System”, Ravi Menon, managing director of the Monetary Authority of Singapore, acknowledged this fact. He believes that single countries can launch measures to counter such a dangerous movement. He compares the situation to driving in an unfamiliar landscape. Even though a driver is fully conscious and has good driving skills, driving will be more difficult when road conditions change or when it rains. 

“When driving, we can’t simply drive without caring about other drivers or the changing terrain and weather,” he said.

If there is anything that has not changed at all, it’s Thais’ attitude towards their first female prime minister. Nearly all newspapers yesterday ran a piece about Yingluck Shinawatra telling Le Monde in Paris that after all her official appointments, she planned to go shopping. The connotation is clear: the rich prime minister is on a shopping spree again, even when most Thais are preparing for more rain amid the political chaos.

It is obvious that Myanmar President Thien Sein will not dare to repeat this mistake. Compared with Paris, Bangkok is in a poor state when it comes to shopping. Compared with Bangkok, Yangon is in an even poorer state. Fortunately, Thien Sein may be like most other male leaders, who rarely go shopping. I can’t imagine what would happen if he told the Thai press that he would go shopping after finishing all his official duties. 

Fitting this situation well is a quote by Gandhi. “The moment there is suspicion about a person’s motives, everything he does becomes tainted.”

Right now, Yingluck’s supporters must be recording names, waiting for the right time to seek revenge. To those who do not truly want peace (real undistorted peace), they may love John F Kennedy’s quote: “Forgive your enemies. But don’t’ forget their names.”

Sadly, true peace will only come if they heed another Gandhi quote: “The weak can never forgive. Forgiveness is the attribute of the strong.”