Thais pine for political fix as unrest hurt economy

AYUTTHAYA, Thailand, April 26 (Reuters) - A deepening political crisis has exacerbated Thailand's economic strife, leaving ailing businesses and anxious workers more concerned about a swift resolution than which faction emerges on top.

In the industrial province of Ayutthaya, 76 kilometres (42 miles) north of Bangkok, there is little support for anti-government protests that have dented the Kingdom's image as safe destination for investment and tourism.

"The economy is hurting everyone but these protests are making it much worse," said Chamnan Chamsukkee, who owns a small automobile parts factory.

His revenues are down 50 percent since last year and most of his machinery has been unused in recent months, during which Thailand has seen its worst street violence in 16 years as a result of anti-government demonstrations.

Chamnan sides with neither the "yellow shirts" -- backed by royalists, the military and the urban middle classes who occupied Bangkok's airports last year -- nor the "red shirts", the rural and urban poor who support ousted premier Thaksin Shinawatra and forced the cancellation of an Asian leaders summit two weeks ago.

"I don't like any of them because they've closed down airports, they've caused riots," he said. "I hope they'll stop because investors are being scared away."

The outlook remains grim for the country of 64 million people and its tourism and export-driven economy.

The Chamber of Commerce University on Thursday predicted Thailand's recession-bound economy would shrink 5.3 percent this year if political unrest continued.

Widespread lay-offs and cuts in production have turned Ayutthaya's once thriving industrial zones into virtual ghost towns.


"The workers are leaving and going home," said Woralak Toungsuwan, who manages a large apartment block where only 200 rooms are occupied from nearly 1,200 six months ago. "There are no jobs for them here anymore."

Tables are empty and staff outnumber customers at Manus Submeechai's riverside restaurant, once a popular nightspot among tourists and local factory workers.

"With these problems, who will want to invest here at this moment?" he said. "I'm a businessman, not a yellow shirt or a red shirt -- I just care about making a living."

Manus is confident, however, that the Oxford-educated Prime Minister Abhisit Vejjajiva, who came to power in December after a series of parliamentary defections the "red shirts" say were engineered by the army, can drag Thailand out of the crisis.

"The foreigners saw how he handled the clashes in Bangkok," he said. "I believe he can save the economy and I hope investors will trust him."

Thailand's tourism industry, which employs about 1.8 million people and accounts for 6 percent of GDP, is suffering after last year's closure of Bangkok's two airports and the travel warnings issued in the wake of violent clashes on April 13 in which two people were killed and more than 100 injured.

Rickshaw driver Chuk Thethip, who works at Ayutthaya's sprawling complex of centuries-old temples, says he has not had a single customer in more than a week.

"I've been doing this job for 40 years and I've never seen it this bad," said the toothless 71-year-old, whose skin is blackened by the sun.

"Tourists are scared by the protests and the fighting. I hope it stops and I trust this government can solve these problems."

Analysts see no end in sight and say unemployment could exacerbate the urban-rural divide and further expose the fragility of a 76-year-old democracy that has seen 18 actual or attempted coups.

"Red shirt" protests are expected to continue if Abhisit clings on to power and a return of a government backed by the self-exiled Thaksin, whose Thai Rak Thai and Peoples Power Party were dissolved by the courts, could bring the "yellow shirt" demonstrators who despise him back onto the streets.

Laithonglian Meephan, who runs an elephant park hurting from a lack of tourists and foreign volunteers, is hoping Thailand's revered 81-year-old monarch Bhumibol Adulyadej can intervene to end the four-year stalemate.

"I really don't see an end to these political problems -- even my elephants are suffering," he said. "Sadly, I think the only way out is for our King to tell everyone to stop fighting." (Editing by Darren Schuettler and Alex Richardson)