Thailand’s Constitutional Court dismissed Prime Minister Srettha Thavisin from office after finding him guilty of an ethical violation, throwing the country into fresh political turmoil.
Srettha committed a “serious violation” of ethical standards, which is grounds for disqualification under the constitution, by picking a convicted lawyer to be a cabinet minister in April, the nine-member court said during a read-out of the verdict on Wednesday. The judges voted 5 to 4 to dismiss Srettha and his cabinet.
The court’s decisions are final and can not be appealed.
Srettha’s ouster risks political chaos in Thailand, where legal challenges have threatened the coalition government cobbled together after messy general elections last year. Foreign investors have pulled money from the country, concerned by both political risk and the government’s failure to revive Southeast Asia’s second-largest economy after a decade of below 2% annual growth.
The nation’s benchmark stock index fell as much as 1.3%, while the baht pared gains to trade little changed against the dollar.
The verdict came after a group of former senators complained about the cabinet appointment of Pichit Chuenban, saying that he was not qualified for the job as he was jailed in 2008 for contempt of court following a bribery attempt. The lawyer was representing former prime minister Thaksin Shinawatra, who’s seen as the de facto leader of Srettha’s Pheu Thai Party.
Srettha became prime minister after a deal between Pheu Thai and its conservative allies, which helped Thaksin return to Thailand after 15 years in self-imposed exile. Thaksin’s indictment in a royal defamation case in June, and now Srettha’s removal, signaled the possible unraveling of that deal.
The verdict against Srettha came days after the same court dissolved the country’s top opposition party Move Forward, which won the the most number of seats in the 2023 election but was blocked from power.
Srettha’s ouster opens risks to economic growth, especially if political horse-trading among the coalition parties drag on and leave a potential power vacuum. Foreign investments may grind to a halt as markets await more clarity on who leads the nation.
Srettha will be leaving behind an economy with a decade of sub 2% annual growth rate, and markets that were spooked by his spat with the central bank over the interest-rate path.
Thailand’s financial markets had been rattled by the recent political upheaval, prompting foreign investors to pull more than $3 billion from the nation’s stocks. The benchmark SET Index of stocks ranks as one of the worst performers of all global bourses tracked by Bloomberg in the past year, while the baht has lost about 3% this year.
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