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Europe Must Follow Through on Rights in Thailand

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ASEAN Beat

Europe Must Follow Through on Rights in Thailand

Brussels must enforce its newfound approach to trade with Thailand.

The European Commission is to be applauded, having recently announced a commendable new values-driven global trade and investment strategy. This fresh approach will fuse jobs and growth with human rights and sustainability. It should leave the world in no doubt that a share of Europe’s riches comes at an ethical price – respect for human dignity, liberty and democracy. The message must be clear: no freedom, no profits.

With this in mind, it is wholly appropriate that Brussels’ morality-laden business strategy comes at the same time as the Commission is poised to turn its trade focus towards what it termed “the vital Asia-Pacific region.” After all, Southeast Asia is a region on the brink, standing on the cusp of economic success while democracy hangs perilously in the balance. And none more so than in Thailand, where an authoritarian regime is suffocating the remnants of democracy while at the same time attempting to charm the international business community. Brussels has the chance to put its actions where its mouth is and enforce this newfound approach to trade with Thailand.

The Bangkok junta, headed by General Prayuth Chan-o-cha is desperately trying to fool the world. Soon after having seized power in May 2014, Prayuth personally addressed the Thai-European Business Association (TEBA), a group representing 80 Thai and European investors, pledging to do “everything” for Thailand to remain a foreign investment hub. He scoffed at suggestions of dictatorial rule. Yet by that point, Prayuth had already detained opponents without charge and outlawed freedom of assembly, by banning gatherings of more than five people. Since, he has shut down media outlets for having the temerity to criticize the regime, a trend which Human Rights Watch fears will have a “choking effect,” anathema to democracy.

Yet, despite this wholesale repression, the junta continues to court global business. Prayuth’s government recently announced an international roadshow, where investment will doubtless be handed the oxygen of incentives, while freedom continues to be strangled.The European Union (EU) has rightly been consistent in criticizing Prayuth and his henchmen. Just a month after the coup, the EU announced an end to official visits and the suspension of free trade talks with Thailand. Within the last several weeks, the European Parliament overwhelmingly approved a lengthy motion demanding an end to Bangkok’s persistent abuses. But now Brussels should make good on these well-meaning statements and declarations. Europe should make the trade that Prayuth so desperately craves dependent on democratic reform.

And make no mistake, the junta is becoming increasingly desperate. The World Bank recently branded Thailand “the worst performing economy in Asean,” while the country’s central bank slashed 2015 growth forecasts for the third time this year. An indication of the panic pervading the corridors of Thai power is the recent appointment of Somkid Jatusripitak as new economics czar and Deputy Prime Minister. Somkid is no standard economist, having previously served as economics adviser and ally to Prayuth’s nemesis, former-Prime Minister Thaksin Shinawatra.

And the EU is in the perfect position to drive home its ethical message. Europe is after all Thailand’s second largest investor and third biggest trade partner. A blow to business with a giant like Europe would be a major embarrassment for Prayuth. It would fuel his ultimate fear of instability and unrest, undermining the very premise of his power grab last year.

There are plenty of options open to the EU if Bangkok’s generals do not abide by Brussels’ ethical standards. For a start, the EU will decide in December whether to hand Thailand’s lucrative fishing industry a “red card.” A “yellow card” warning has already been issued to clean up a thoroughly unregulated industry worth $16.9 billion in 2013, but which is sustained with medieval slave labour. However, the EU could also look beyond such procedural measures and perhaps consider sanctioning individuals and companies that endorse and reap profits from the fishing industry. There is plenty of precedent. Asset freezes, travel bans and other restrictions can hurt the bottom line in targeted countries, damaging their bilateral trade relations way beyond Europe.

Were Thailand to suffer a similar fate, it would send a potent message across Southeast Asia, where Western values such as democracy and personal liberty cannot be taken for granted. While Indonesia boasts a vibrant democratic system, Vietnam and Laos remain wholly authoritarian regimes. The likes of Malaysia and Singapore fluctuate somewhere between the two. With Thailand on the financial ropes, Europe has the ideal opportunity to influence the balance of freedom in the region, demonstrating that retreating democracies will pay a high economic price.

The stars have aligned perfectly for the European Union to construct the very first case study showcasing its new ethical trade and investment strategy. And it must do so not only because it is patently the right thing for Thailand’s future. Turning European grandstanding into economic policy is surely the key to reining in dictatorship in Southeast Asia and beyond.

Anthony Kleven is an economic risk consultant based in Singapore. The views expressed here are his own.