POLITICAL TENSION IN THAILAND NOT GOOD FOR M`SIA, SAYS MIA

By Tengku Noor Shamsiah Tengku Abdullah

KUALA LUMPUR, April 15 (Bernama) -- The ongoing political tension in
neighbouring Thailand is not good for Malaysia, says the Malaysian Investors'
Association (MIA).

"It's contagious. When your neighbour's house is on fire, you feel the heat.
The collapse of the Thai financial market in 1977 spilled over to Malaysia.

"Hopefully, history does not repeat itself," said MIA president Dr P.H. Lim.

Thailand's GDP for this year is expected to dwindle further to -3.5 per
cent.

Many countries including the European Union had issued warning to their
citizens not to travel to Bangkok and other parts of Thailand.

The current turmoil, combined with the airport shutdown late last year, will
likely slash tourism revenue by a third or 200 billion bahts (US$5.6 billion)
from 2008 as foreigners shun the country, said Kongkrit Hiranyakit, chairman of
the Tourism Council of Thailand.

The violent demonstrations by anti-government protesters could lead to
200,000 jobs loss at hotels and travel businesses, he said.

Thailand's tourism industry directly employs about 2 million people.

Lim said Thailand's currency value would weaken against the US dollar.
(Currently US$1 = 35.38 Bahts).

"The currency depreciation will have a negative impact on our Malaysian
ringgit as fund managers group Thailand and Malaysia as part of the Asean Zone,
a big family of 500 million consumers," he said.

Lim however said Singapore banks are likely to benefit when there is a
currency flight from Thailand to seek a safe haven.

He said the "Tom Yam" impact could economically spill over to Malaysia due
to transboundary investments, tourism and trade between Malaysia and Thailand.

Malaysia is a big importer of Thai rice, fish, vegetables, fruits and
other agriiculture produces.

"Chaos in Bangkok followed by a State of Emergency will cripple
transportation and mobility of goods. The loss per day may run into RM100
million.

"If the situation prolongs and is likely to drag on, we will see inflation
in prices of Thai rice, fish, vegetables and other goods from Thailand," he
said.

It was reported that Thai Prime Minister Abhisit Vejjajiva may step down on
April 20 to pave the way for fresh elections.

Many fear the direct confrontation between the government and the
red-shirted pro-Thaksin (Shinawatra) protesters could lead to more violence and
instability.

Former Prime Minister Thaksin Shinawatra is currently living in exile.

Lim said the political impasse is likely to see another general election in
which the "People's Power" would have the final say on the country's future.
-- BERNAMA