Background

“Clearly the government is not listening to the will of the majority, but only to a powerful few. If the government does not listen to the voice of the people, the government does not belong to the people. By not listening to the people, and by not following through with its promises to the people, the government is undermining the very foundations of the democratic system”.
–Somsak Kosaisook, General Secretary of the State Enterprise Labour Association of Thailand (an umbrella group for all workers in state agencies)

Union protests in defiance of the Thaksin administrations plan to privatise the Electricity Generating Authority of Thailand (Egat) have steadily escalated since the initial February 23rd protest involving roughly 2,000 unionists from 5 state enterprises.

On March 3rd, the ninth day of protest, some 50,000 state enterprise workers from all 41 state enterprises were joined by private sector workers, students and activists in front of Egat headquarters in the biggest demonstration to date against the Thaksin government, well known for its’ authoritarian, arrogant CEO style governance. It is the largest protest in Thailand since the 1992 democracy uprising, and the largest union led protest in Thai history.

Union members contend that the privatisation policy would allow ruling politicians, their families and cronies to grab a majority of shares when state firms are available for sale, as was the case with the privatisation of the Petroleum Authority of Thailand last year (PTT). PTT shares were sold in just a few minutes, with huge profits for the elite only a few months later, as the share price rose several fold over the initial public offering (IPO) of 35 baht.

The unions are demanding that the prime minister open forums that allow people to air their opinions about Egat’s privatisation, a demand supported by an increasing majority of the public and many senators. Somsak Kosaisook challenged the government to conduct a public hearing and then a national referendum to solve the conflict. Egat labour union head Sirichai Maingam stated that if the public supports privatisation in a referendum, the protests would end.

Four senate panels including the committee on social development and human security, foreign affairs, environment and state enterprises privatisation support the open forums. A serious concern is that a few people close to the PM, who would snatch Egat shares will be positioned to make huge profits from inside information arising from the fact that government decisions will have a bearing on stock prices. In short, Thailand has no effective safeguard against corruption and monopoly driven high service fees.

Nopphakhun Yangiam, a leader of the White Flower Group, which forms the core of the union workers, insisted that nobody was behind the huge rally of state-enterprise workers. “It’s a force pure and simple, because we reckon that if privatisation goes ahead the public will not be better off. The public might also have to pay higher electricity bills after privatisation,” he said. Additionally, workers charge that the privatisation is not being held transparently, a concern even shared by investors.

Egat was originally scheduled to be corporatised on March 1, a step on the way to the IPO planned for April 30, and the May 12 listing on the Stock Exchange of Thailand. Egat’s IPO is the year’s most anticipated listing for investors, and would be the largest share float in the country’s history. The government contends it will maintain a 75% shareholding, with Egat’s market capitalization on listing valued at some 300 billion baht (1 US$=39 baht).

Over the next three years the State Enterprise Policy Offices plan to list 12 state enterprises on the stock market. IPOs of state enterprises include the Airports of Thailand Public Co Ltd, the Mass Communication Organisation of Thailand, the Metropolitan Water Works Authority, the Government Pharmaceutical Organisation and the Port Authority of Thailand.

It is essential that Egat’s listing is derailed as it could hurt the momentum of the other state enterprises scheduled for public listing on the stock exchange, as well as the Thaksin government’s ability to act in an undemocratic fashion.

The March 1st corporatisation, which involves the transfer of assets and liabilities from the state to a private company, has been delayed. Speculation as to the reason for the delay include the result of the government waiting for a Royal decree that would cancel Egat’s status as a state enterprise, and the government cited ‘procedural problems’. Investor confidence is surely a key factor as well, as it is steadily declining with the increasing strength of protest.

On March 2nd the government decided to abort the share-swap plan with Banpu, which the Egat union was strongly dissatisfied with and initiated the picketing of Egat headquarters on February 29th, in an effort to ease tensions and placate the union. The plan failed as the following day saw the largest numbers in front of the Egat office to date.

The government intended to sell off its stake in Electricity Generating Co to Banpu, a listed energy firm. In return Banpu was to sell its 15% stake in Ratchaburi Holding Plc to Egat, so that Egat would wind up with a controlling stake of 60% in Ratchaburi Holding.

The protest, as already stated, is coming from within the union and is based fully on the strength of the union. As the call to Thaksin government for basic democracy enters its’ second week, the State Enterprise Labour Association of Thailand is requesting solidarity support from their brothers and sisters in the international community.

Privatisation is a plague that has spread throughout the world and support and strength in Thailand is strength in the global fight. Battle lines have been clearly drawn on this particular issue of privatisation which has much broader implications in terms of the standoff with the undemocratic Thaksin government/regime and future privatisation plans. This is the first major mass protest against the Thaksin elite, and the unions are ready to let the government and the Thai people know that the world is behind them in their call to stop privatisation, promote transparency and democracy, and above all else, to listen to the voice of the people.