AMBASSADOR AND CNS GENERAL WINAI DISCUSS POLITICAL

C O N F I D E N T I A L SECTION 01 OF 04 BANGKOK 002280

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E.O. 12958: DECL: 04/23/2017
TAGS: PREL PGOV PHUM ECON EINV KDEM KJUS ASEC TH
SUBJECT: AMBASSADOR AND CNS GENERAL WINAI DISCUSS POLITICAL
SITUATION

REF: A. BANGKOK 1715 (SURAYUD ON CIVIL LIBERTIES)

B. BANGKOK 1538 (AMBASSDOR MEETS WITH CHATURON)

C. 06 BANGKOK 7594 (BUILDING CASE VS. THAKSIN)

Classified By: Ambassador Ralph L. Boyce, reason: 1.4 (b) and (d).

SUMMARY
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1. (C) A top military officer expressed concern that
opposition politicians are fomenting trouble, including by
manipulating opposition to the draft Constitution. In an
April 20 meeting, Council for National Security (CNS)
Secretary General Winai Phattiyakul told the Ambassador that

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deposed Prime Minister Thaksin Shinawatra's activities
remained of concern, but by the end of May the government
would have established grounds for his prosecution for
financial improprieties. There also were solid grounds for
dissolving Thaksin's former party, although Winai
acknowledged Thai Rak Thai (TRT) would be able to
reconstitute itself after dissolution; Winai hoped the stigma
of a ruling that the party cheated in an election would
impede a TRT comeback. Winai said Prime Minister Surayud was
becoming more decisive and would carry out a major cabinet
reshuffle in a month, if the current cabinet continued to
languish. CNS Chairman General Sonthi was considering a move
into elected politics after retirement from the Army. At
Winai's request, the Ambassador explained the USG had no
interest in internationalizing the security situation in
southern Thailand. The Ambassador also explained that the
draft revisions to the Foreign Business Act were harmful to
the investment climate. End Summary.

WORRIED ABOUT THAKSIN AND HIS CLIQUE
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2. (C) General Winai opened his discussion with the
Ambassador by expressing concern about the overall situation
in Thailand, noting mischievous politicians were roiling the
waters and trying to take advantage of the difficulties
encountered by the Council for National Security (CNS) and
Prime Minister Surayud's administration. When pressed,
though, Winai admitted he was uncertain whether former Prime
Minister Thaksin Shinawatra was trying to direct events, or
whether close allies of his (e.g., Newin Chidchob and Prommin
Lertsuridej) were trying to further Thaksin's interests.
Another possibility was former PM Chavalit, who has rekindled
dreams of becoming PM again. Winai expressed concern about
rumors that former Natural Resources Minister Yongyuth
Tiyapairat has appeared at certain points in the Thai-Lao and
Thai-Cambodian border areas. (Yongyuth currently holds a
U.S. student visa, issued subsequent to the coup, and we
understood he was pursuing studies in the U.S.)


3. (C) Thaksin had written to King Bhumibol, pledging to quit
politics, Winai recounted. Thaksin had claimed his wife,
Potjaman, would divorce him if he sought to return to
political life. Thaksin also had contacted the Thai
Ambassador in London to try to arrange an audience with Crown
Prince Vajiralongkorn during the Crown Prince's April visit
to the United Kingdom. Winai said that when the Thai
Ambassador denied this request, Thaksin waited in the lobby
of the Crown Prince's hotel, inserting himself into the
receiving line of hotel staff. On arrival, according to
Winai, the Crown Prince had a very brief exchange with
Thaksin in this public setting. But when Winai later told
unspecified figures from Thaksin's Thai Rak Thai (TRT) party
that the deposed PM was acting inappropriately, Winai's TRT
interlocutor claimed that the Crown Prince had summoned
Thaksin for a lengthy audience. Winai claimed this story
illustrated an unacceptable effort by Thaksin to force
himself upon the royal family -- and then misrepresent his
interactions.


4. (C) Winai was optimistic that the government would take
effective legal action against Thaksin by the end of May.
The Asset Examination Commission (AEC) had clear evidence
that Thaksin had inappropriately evaded taxation, and it
would impose a substantial penalty on him for doing so. The
AEC also would present a strong case that Thaksin had
improperly used cutout firms ("nominees") to evade certain
provisions of law. Winai admitted, however, that efforts to
prosecute Thaksin over his wife's purchase of land from a
state agency (ref C) might flounder, especially as former

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Deputy PM Pridiyathorn Devakula had recently testified before
the AEC that the Prime Minister had no formal authority over
the state agency in question. (Pridiyathorn subsequently
complained that news reports casting his testimony as
favorable to Thaksin's side were unfair, as he had simply
provided facts without offering his opinion or
interpretation.)

THAI RAK THAI'S FATE
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5. (C) The Constitutional Tribunal had seen strong evidence
that TRT had engaged in fraudulent and undemocratic acts
during the April 2006 election, Winai said, citing
conversations he had with members of the Tribunal. While
Winai believed the Tribunal had sufficient cause to rule
against TRT and order the party's dissolution (as Winai has
predicted in previous meetings with the Ambassador),he
mentioned that at least two of the nine Tribunal members had
been offered very substantial bribes by Thaksin's associates.
When the Ambassador noted that TRT figures planned to
reconstitute the party after dissolution (see ref B),Winai
admitted this was likely, but he believed that a formal
ruling that TRT had cheated in the last election would
meaningfully harm the party's reputation and impede it from
making a comeback.

SURAYUD IN CHARGE
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6. (C) The Ambassador asked Winai if he was disappointed with
PM Surayud's performance. Winai said he felt more of a sense
of pity, rather than disappointment; Surayud's cabinet had
failed to perform. The Ambassador noted that, because
Surayud did not have a wide circle of civilian acquaintances
from the political class, he appeared to have relied on Privy
Council President Prem Tinsulanonda to identify figures for
his cabinet. Consequently, Prem -- age 86 -- had recommended
people relatively advanced in years (average age 64). Winai
agreed this was part of the problem. He derided the cabinet
as inept, saying that the cabinet's poor performance had
contributed to unfounded rumors of a rift between the CNS and
Surayud's administration. Winai said that the PM and CNS
leaders had agreed to meet more often and to try to show the
public that they were working together.


7. (C) Winai was optimistic that Surayud, after his recent
extended medical check-up, appeared more energized and
determined. (Comment: This tracks with what we have heard
from other contacts. End Comment.) He was acting more
decisively, and would carry out a complete reshuffle of his
cabinet in a month if it continued its poor performance.
Addressing Surayud's imminent plan to add a handful of deputy
ministers to the cabinet, Winai said that this was Surayud's
way of taking a more limited measure, so he would not have to
fire anyone, but could still inject new blood into the
cabinet.

SONTHI RECONSIDERING HIS FUTURE
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8. (C) The Ambassador asked about the plan, floated in the
press and subsequently rejected, for a new cabinet position
of Deputy PM for Security Affairs. Winai admitted that the
creation of this position had been his own idea; he believed
it would be useful, to bridge the gap between the CNS and the
administration, if CNS Chairman Sonthi Boonyaratglin were to
take this job. Surayud was willing to go along with the
plan, Winai claimed, but Sonthi was against it, at least in
part because of the negative reaction from foreign quarters.
The Ambassador said in clear terms that it would be a mistake
to place General Sonthi in a cabinet position; if Sonthi had
gone along with this plan, it would have created headaches
for the friends of Thailand who supported maximum civilian
influence in this government and the earliest possible return
to elected civilian leadership.


9. (C) Winai added that General Sonthi was reconsidering his
earlier determination to avoid a political role for himself
in the future. He might run for elected office after his
retirement from the Army later this year. Until Thaksin's
future disposition was clear, CNS figures could not rule out
the deposed PM returning and wreaking havoc on the country --
and possibly acting vengefully against CNS members. The

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Ambassador expressed surprise that Sonthi might turn to
elected politics, noting he lacked the background and
instincts to be an effective politician. A move by Sonthi
along these lines would complicate efforts of his associates
to argue that he was motivated simply by the political crisis
of 2005-06, rather than a desire to institutionalize a more
powerful role for the armed forces.

CONSTITUTION
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10. (C) The Ambassador requested Winai's views on the draft
constitution. Winai noted the draft was under attack from
many quarters, for different reasons. Issues of concern
included the nature of the Senate, the creation of
multi-member districts, a revamping of the party list system,
and especially the decision (consistent with all previous
constitution drafts) not to establish Buddhism as Thailand's
official religion. This last issue was being exploited by
some of the government's foes, Winai lamented -- principally
former Prime Minister Chavalit Yongchaiyudh, who was working
behind the scenes to promote public opposition to the draft
constitution. Winai observed that Chavalit's ambition to
return as Prime Minister remained, and that many of his
former New Aspiration Party associates (such as current TRT
Party Leader Chaturon Chaiseng and Deputy Leader Sudarat
Keyuraphan) remained in contact with Chavalit. The former
PM's residence buzzed with activity, just as it had when he
was in office, Winai observed.


11. (C) The Ambassador asked Winai about the recent trip he
had taken to Europe over the (mid-April) Songkran holiday.
Press reports had surmised that Winai and his traveling
companions -- National Legislative Assembly President Meechai
Ruchupan and leading constitutional scholars Borwornsak
Uwanno and Wissanu Krea-ngam -- had worked on a new
constitution draft. Winai told the Ambassador that the trip
was purely a sightseeing vacation, devoid of political
plotting. (Comment: We remain skeptical. End Comment.)


12. (C) Recalling PM Surayud's explanation that the RTG would
restore full civil liberties after the passage of a new law
on security affairs (ref A),the Ambassador said that, if
such a law was indeed a prerequisite for returning to
normalcy, it would be good for the government to ensure
speedy passage. Winai offered no substantive reply.

SOUTH
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13. (C) Alluding to recent public comments by a senior U.S.
military officer, Winai asked the Ambassador to explain
recent foreign interest in the security situation in southern
Thailand. He said he was asking this at the request of
General Sonthi. The Ambassador explained that the USG had no
intention of promoting a foreign presence in southern
Thailand; the U.S. military officer's remarks had been
sensationalized by an aggressive journalist who had pressed
the officer in order to get material for an article. Winai
said he was relieved to hear this explanation, which he would
relay to General Sonthi.

INVESTMENT CLIMATE
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14. (C) The Ambassador closed the meeting by expressing
concern about the draft revision to the Foreign Business Act
(FBA),which would have a negative impact on the investment
climate in Thailand. The Ambassador noted that U.S.
corporations would in effect be penalized for following
long-established practice that benefited the Thai economy.
The Ambassador related that a major U.S. agricultural
corporation had cancelled a planned 100 million USD expansion
because of concern about the uncertain regulation of foreign
ventures. The USG understood the RTG's motivation to address
irregularities relating to the Shinawatra family's sale of
the Shin Corporation to Singapore's Temasek investment firm.
But such measures would scare away U.S. corporations, which
had other options for investment in the region. Winai
conceded that the investment climate was suffering as a
consequence of the many problems affecting the country and
the administration.

COMMENT

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15. (C) Winai's claim that CNS opponents are stoking
opposition to the draft constitution is not surprising.
Winai's allegation that General Sonthi would like to remain
in a position of political influence is also plausible;
septel will report further concerns we have heard on this
issue. Finally, we understand Winai's logic in arguing that
a finding by the Constitutional Tribunal against TRT would
harm the (reconstituted) party's prospects in the next
election. However, Winai may not realize that the Tribunal,
as a new institution created post-coup, has a questionable
degree of moral authority; regardless of the facts of the
case, TRT officials may be able to convince their supporters
-- not to mention more neutral voters dismayed by the inept
performance of the Surayud administration -- that their party
never received a fair hearing.
BOYCE