Reuters:

But corruption indicators show graft remains deeply rooted two years into Abhisit’s administration.

The reason lies in one of the fundamental weaknesses of his premiership — he holds on to power only with the support of networks of politicians, generals and bureaucrats whose reputation for probity does not match his own, and who epitomize the patronage politics that has long bedeviled Thailand.

The regulatory framework in Thailand is quite good but whether it is put into practice is a different issue,” said Kanokkan Anukansai, Thai programme manager of anti-corruption watchdog Transparancy International.

The lack of stability makes it hard to make tough, potentially politically damaging decisions.”

The army budget has doubled since a 2006 military coup removed a government led by former premier Thaksin Shinawatra, who was accused of corruption and later convicted in a Thai court of breaking conflict of interest laws while in office.

Recent army procurement deals have raised questions of whether military corruption has worsened since the coup.

These include a 350 million baht ($11.4 million) purchase of a leaky surveillance blimp last year and more than 700 UK-made GT200 bomb detectors that turned out to be an embarrassing scam — they are lumps of plastic with no working mechanical parts.

The military said in July it would keep the airship if its U.S. manufacturer paid for repairs. It initially insisted the bomb detectors, which cost 900,000 baht ($29,360) each, worked fine until weeks of public outcry brought an admission they had flaws. But they said the purchase was above board.

Cases like these are hard to pin down because there is no serious investigation into who was accountable. It is usually taken as an honest mistake and the blame is on manufacturers. The procurement side gets off lightly,” said Nuannoi Trirat, an economist at Chulalongkorn University who studies governance.

One executive at a foreign luxury property developer said companies usually budget for direct and indirect bribes, sometimes to circumvent loosely worded regulations.

“As long as it doesn’t become unpredictable, it’s just a cost of doing business” said the executive, who declined to be identified because of the sensitivity of discussing bribes.

While there is no exact figure that measures how much corruption undermines Thailand’s competitiveness, economists said worsening perception certainly hurts confidence.

Many investors are used to this and it’s not their biggest concern (compared to political instability). But there appear to be more complaints in recent years especially in the construction and procurement businesses and this certainly eats into growth,” said Poramet Tongbua, an economist at Tisco Securities.

“It is something businesses keep an close watch on and would seriously consider if it gets worse.”

Months into Abhisit’s $42-billion three-year government stimulus programme, two government ministers resigned in scandals linked to abuse of the funds. Allegations ranged from irregularities in the procument of hospital equipment and school supplies to rigged bidding process on construction projects.

“Opportunities for graft and mismanagement remain high,” said Danny Richards, senior Asia editor of the Economist Intelligence Unit. “While trying to push through spending programmes as quickly as possible, there does not appear to be any great priority placed on ensuring quality control.”

BP: Talking of corruption, according to Transparency International, Thailand is perceived as being more corrupt since 2006 – see here and here – although other figures show things improved last year.* As the article also higlights (not excerpted above), it is the military procurement where there are suspicions. Since 2006, the military budget has gone up from 86 Billion Baht to B170 billion Baht. Despite the possibility of corruption – see here and here – the media have not looked deeper although they are happier to go after other corruption scandals with a vengeance – although for the recent GT200 device scandal, they started to dig, but soon dropped it.

Prachachart in an editorial (as translated by the Bangkok Post)

Corruption is still a thorn in the side of the Abhisit government, as it battles rising security threats.

In the latest case of suspected corruption, armed men seized a parking lot at Suvarnabhumi International Airport, following a dispute between two rival groups contracted to operate the parking lot. Prior to this, several corruption scandals were reported in the Interior, Commerce and Public Health ministries.

Foreign news reports have suggested that PM Abhisit is turning a blind eye to these scandals to save his government. He reportedly dares not touch questionable projects under the ministries controlled by coalition parties. Problems have cropped up in rice and tapioca sales as well as public utility construction projects in the provinces.

On the story of the armed black men at the airport, the Bangkok Post:

The Bhumjaithai Party is being accused of making false promises to two businessmen to lure them into investing hundreds of millions of baht in a project to manage parking lots at Suvarnabhumi airport.

Businessmen Thas Pojanapraphan and Supachai Sathitwimol, former executives of Parking Management, issued a statement yesterday to explain their role in the company.

They claimed they were approached by an aide to a political figure to ask them to invest in the company.

The two refused to name the politician or the party to which he belonged, but they said the party had proposed a project to the cabinet to lease 4,000 gas-fueled buses to supplement the ageing Bangkok Metropolitan Transit Authority fleet. This was a clear reference to the Bhumjaithai Party.

The businessmen said the aide approached them twice to buy shares in the company.

Mr Thas gave the aide 17 million baht for the shares and another 20 million baht as a personal loan. He said the loan was in return for a position as an authorised director of Parking Management with administrative powers.

Mr Thas said his name was later forged on documents that changed the structure of the company’s board, effectively robbing him of administrative power.

He said he lodged a complaint against the aide with Bang Phlad police, but the aide filed a counter-charge and he became the subject of a warrant the day after the aide lodged his complaint.

BP: Thas is the son of a former deputy permanent secretary of defence. Also, from the Bangkok Post:

Three associates of Bhumjaithai Party de facto leader Newin Chidchob have appeared before the committee looking into the Suvarnabhumi airport car park contract breach.

Sampan Lertnuwat, Ekaporn Rakwamsuk and Tosapol Sangkhasap were joined before the Transport Ministry inquiry panel yesterday by former deputy transport minister Songsak Thongsri.

Mr Ekaporn denied he and his associates had demanded 100 million baht from Ms Praeo in return for helping her settle the company dispute.

Bhumjaithai has been linked to the dispute over the operation of the car parks from the start but party spokesman Supachai Jaisamut insisted yesterday his party, its executives and members had nothing to do with the car park operation.

BP: Bhum Jai Thai control the Transport Ministry and barring removing Bhum Jai Thai from the coalition (which still looks unlikely) there is nothing the Democrats can do about this.

*Did some further digging and found the World Bank control of corruption indicator (-2.5 is lowest; 2.5 is highest)

Year

2002

2003

2004 

2005

2006

2007

2008

2009

Control

-0.29   

-0.18 

-0.17   

-0.01   

-0.21

-0.29   

-0.39   

-0.23

BP: As you can see the control of corruption goes up and down, but actually as of the end of 2009, Thailand was seen as no less corrupt under this indicator than when Thaksin was in power (although it is hard to separate out the end of one government from another as governments do not come and leave office at the beginning and end of each calendar year so governments do overlap).