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Thaksin counts the cost of corruption scandal

Along with his fellow MPs, government communications tsar Suranand Vejajjiva is packing his bags for parliament's three-month recess, which began yesterday.

Unlike many, though, he is not totally free. Budget committee hearings and political party business will eat into his holiday plans. But Mr Suranand, who runs Prime Minister Thaksin Shinawatra's public relations department, said he was happy to put this week's heated censure debate on alleged airport kickbacks behind him.

'It's a nice relief,' he said. 'You have to look at all the data before you can reach a decision [on the allegations].'

With a police investigation into a US$65 million contract for airport scanners ongoing, the government is still counting the cost of a scandal that many analysts say has badly tarnished its reputation.

Coupled with a slowing economy chained to rising oil prices, the past few months have been testing for Mr Thaksin, who trounced the opposition in a February poll. Rising bloodshed from an insurgency in southern Thailand, as well as dissent within the ruling Thai Rak Thai party, have raised further questions about his leadership.

Opinion polls suggest urban voters are unconvinced by the government's attempts to explain away the alleged graft at Bangkok's new international airport.

On Wednesday, MPs voted 367 to 119 against the opposition motion that centred on irregularities in the pricing and delivery of US-made baggage scanners. But snap opinion polls found a majority of respondents believed the charges levelled against the government.

'We lost the vote, but we didn't lose the debate,' said Korn Chatikavanij, deputy leader of the opposition Democrat Party.

Perhaps more worrying for Mr Thaksin is the deteriorating economic picture. Solid growth during his first four-year term meant plenty of handouts to rural voters, who can swing Thai elections.

A slowdown in exports has triggered Thailand's first deficit since the 1997 crisis, with the current account at a US$4.7 billion deficit in the first five months of the year. Economists predict growth will fall to 4 per cent this year, but could slip further if oil prices keep rising.

'In his second term Thaksin has struggled. He's no longer invincible or unassailable,' said Thitinan Pongsuhdirak, a political scientist at Chulalongkorn University.

Transport Minister Suriya Jungrungreankit, target of the censure debate, is tipped to be moved in a cabinet reshuffle later this month. But Mr Thaksin's aides deny the opposition landed any solid blows during the debate and insist that the second term is firmly on track.

'Apart from the energy prices, when you look at the economic foundations it's very stable. Economic and political stability is there,' Mr Suranand said.

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