THAILAND: CALL ON BANGKOK GOVERNOR SUKHUMBHAND

UNCLAS SECTION 01 OF 02 BANGKOK 000658

SENSITIVE
SIPDIS

STATE FOR EAP/MLS, NSC FOR PHU

E.O. 12958: N/A
TAGS: PREL PGOV ETRD TH
SUBJECT: THAILAND: CALL ON BANGKOK GOVERNOR SUKHUMBHAND
TOUCHES ON PAST CORRUPTION, POLITICS, CULTURAL COOPERATION

BANGKOK 00000658 001.2 OF 002



1. (SBU) Summary: Ambassador paid a courtesy call on Bangkok
Governor M.R. Sukhumbhand Paribatra March 12 and discussed
the challenges Sukhumbhand faced resolving lingering
corruption cases from past administrations, national
politics, and cultural cooperation. Sukhumbhand noted that
the Austrian company involved in the procurement scandal
which had brought down his predecessor is now wholly owned by
U.S. corporation General Dynamics. He suggested
anti-government "red" protesters would have a difficult time
sustaining long-term protests in Bangkok because most Thai
were tired of protests and wanted to "get on with life." End
Summary.

"Fire truck case is a political death trap"
--------------

2. (SBU) In response to Ambassador's question about the main
challenges facing the Bangkok Metropolitan Administration
(BMA),Bangkok Governor Sukhumbhand said his chief headaches
were old cases involving alleged corruption that "would not
fade away." Principal among those was a 6 billion baht ($165
million) deal with the Austrian firm Steyr for more than 500
fire trucks and boats signed by former Governor (and PM)
Samak on his last day in office, and eventually endorsed by
the previous governor Apirak. (Note: the National Counter
Corruption Commission's (NCCC) indictment of a number of
officials involved in the procurement deal, including Samak
and Apirak, led Apirak to step down in late 2008 just after
re-election, opening the way for Sukhumbhand to be elected in
January.)


3. (SBU) Sukhumbhand noted that the procurement deal, which
he termed a "political death trap for me," now had an
American angle, since General Dynamics had subsequently
acquired Steyr. He had sought to extract the BMA from the
deal immediately upon assuming office, but found himself
caught between the NCCC and the Office of Attorney General
(OAG). The NCCC had ruled that there were indications of
wrongful doing in the Steyr contract and that BMA should end
the deal via court action, but the OAG had ruled the contract
to be valid and refused to let the BMA sue Steyr to end the
deal. As a result, Sukhumbhand and the BMA were stuck: they
were required to continue to make payments every six months
from an irrevocable Line of Credit, according to the terms of
the contract, while the number of unused trucks and fire
boats stored on the docks continued to grow.


4. (SBU) Sukhumbhand suggested the BMA might seek Steyr's
approval to use the equipment in the interim, without bias to
eventual legal action against the contract. Among the
irregularities cited by Sukhumbhand were barter transactions
associated with the contract and assembly of some of the
trucks in Thailand as opposed to abroad, as the terms of the
contract stipulated. BMA was mulling over whether it would
initiate legal action on its own, since the OAG had refused
to represent it.

Politics from the streets to the Cabinet
--------------

5. (SBU) Sukhumbhand, a patrician academic not previously
known for mixing it up on the stumps, described how he spent
his weekends out and about Bangkok meeting local residents
and discussing their problems. He suggested that the
anti-government red shirt protesters associated with the
United Front of Democracy against Dictatorship (UDD) would
not be able to sustain large-scale protests because most Thai
wanted to get on with life. Notwithstanding his long-time
affiliation with the currently ruling Democrat Party,
Sukhumbhand said he did not play politics when it came to
approving permits for protests. "I play it straight, and give
the reds toilets too."


6. (SBU) Sukhumbhand was philosophical about having committed
to run for Governor just two weeks before the Democrats found
themselves with an opportunity in December 2008 to return to
national government after eight years in opposition (a former
deputy Foreign Minister, Sukhumbhand was known to have
coveted the Foreign Minister portfolio). The Bangkok
Governorship was the largest elected constituency in
Thailand, he noted, and required more multifaceted executive
management than practically any single ministerial portfolio.
He joked that experience had shown that it was possible to

BANGKOK 00000658 002.2 OF 002


serve as Foreign Minister at any age; Ambassador noted that,
with six Foreign Ministers in 2008, the job opened up
frequently.


7. (SBU) Sukhumbhand lamented the structural imbalance
between the responsibility born by the BMA Governor and the
power the Governor wielded: any expenditure over 200 million
baht ($5.5 million) had to be approved by the Cabinet, with
the BMA requests forwarded by the Ministry of Interior.
Nineteen separate government agencies were involved in
Bangkok's traffic and mass transit systems, with the BMA
wielding full control only over the Sky Train.


8. (SBU) Sukhumbhand asserted that the BMA's 2 billion baht
($55 million) budget for economic stimulus gave BMA
flexibility in helping economic recovery plans. He had
prioritized opening new markets to benefit small traders,
providing small loans, stimulating tourism, and providing
10,000 units of housing for low-salaried BMA workers. BMA
had also used its good credit rating and affiliation to
several banks to arrange for the banks to buy back credit
card debt from BMA employees and repackage it at much lower
interest rates, putting more money in the pockets of people
certain to spend, rather than in banks hesitant to lend
currently.

Cultural Cooperation
--------------

9. (SBU) Ambassador noted that the Embassy's cultural affairs
section often partnered with the BMA on programming and
complimented Sukhumbhand on the recently-opened Bangkok Art
and Cultural Center. Sukhumbhand expressed the desire to
expand such cultural cooperation but said that the Cultural
Center faced its own legal difficulties in administration.
He wanted to involve civil society in the Center's
operations, and his predecessor had tried to form a
foundation to give civil society seats on a board running the
Center. Lawyers had advised Sukhumbhand, however, that
property laws made this formula legally problematic, so for
now the BMA would run the Center directly.
JOHN