Thailand reshuffles cabinet to focus on troubled economy

Prayuth Chan-Ocha, Thailand's prime minister.
Dario Pignatelli | Bloomberg | Getty Images

Thai Prime Minister Prayuth Chan-ocha has reshuffled his cabinet, appointing a new finance minister and a new deputy premier to oversee the economy as the military government seeks to spur growth.

Southeast Asia's second-largest economy has consistently missed government targets since Prayuth, then army chief, led a coup in May 2014 to end months of protests, with exports and domestic demand stubbornly sluggish.

A weak economy could undermine support for the junta as frustration with restrictions on political activity simmers, particularly among younger voters and supporters of former Prime Minister Yingluck Shinawatra, whose government was ousted last year.

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Apisak Tantivorawong, former president of state-owned Krung Thai Bank, has become finance minister, replacing Sommai Phasee, according to a proclamation on Thursday.

Apisak, 61, has a master's degree in business administration from the University of Tennessee in the United States.

A government adviser, Somkid Jatusripitak, who is also a former finance minister, has been appointed deputy prime minister in charge of reviving economic growth.

Somkid, 62, a former marketing executive, was a deputy prime minister and commerce minister in a government of deposed Prime Minister Thaksin Shinawatra, Yingluck's brother, and was a key proponent of populist, big-spending policies known as "Thaksinomics".

Somkid has a doctorate in marketing from Kellogg Graduate School of Management at Northwestern University.

"Investors will welcome the new appointments. Somkid has the experience in reviving an ailing economy," said Vikas Kawatra, senior analyst of SCB Securities.

Barnabas Gan, economist with OCBC Bank in Singapore, said the new team might not bring quick change. "With the significant lag in growth already seen in the first half, it is nothing short of a miracle perhaps for Thailand to see a sizable pick-up in economic momentum."

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Among the adjustments, Apiradi Tantraporn, previously deputy commerce minister, has been appointed minister, replacing General Chatchai Sarikulya, who becomes agriculture minister.

Arkhom Termpittayapaisith, previously deputy transport minister, has become minister, replacing Air Chief Marshal Prajin Juntong, who becomes deputy prime minister.

Don Pramudwinai, previously deputy foreign minister, has become minister and a former Board of Investment secretary general, Atchaka Sibunruang, becomes industry minister.

The junta says speedy government spending will drive growth but disbursement of funds has been slow and big infrastructure projects have stalled.

State planners on Monday cut the 2015 economic growth forecast to 2.7-3.2 percent from 3.0-4.0 percent. Many economists believe that is too optimistic.

Growth last year was 0.9 percent.

The economy grew 0.4 percent in April-June from the previous quarter, with tourism the key driver. A bomb in Bangkok on Monday, which killed 20 people, has struck a further blow to the economy.