He went on to say that everything Shin Corp sold to Temasek would belong to the Singaporean government, and would not be in private hands. “So, how can I sell off my country?” he wondered.

Thaksin’s comment came less than three weeks after the Singaporean government’s investment agency concluded the historic purchase of 49 per cent of Shin Corp for a record US$1.87 billion (Bt73.6 billion). So the jury is still out. But the ridiculous comment he made reveals Thaksin’s growing anxiety over the sale as the public outcry over it has intensified.

Over the past two weeks, local media outlets have criticised the deal as “selling off” Thailand. It was an extraordinary transaction because it involved the sale of government concessions, including telecommunication wavebands, satellite parking and air traffic rights and iTV. Several newspapers even dwelled on the impropriety of selling a company that had been given the Royal Garuda emblem.

For the first time, a number of press outlets have featured and detailed the meteoric increase in Singaporean investment into Thailand since the 1997 economic crisis. Singapore is now second only to Japan in terms of international investment in Thailand. Most reports were suspicious of the island’s intentions. They said the latest deal could endanger the country’s security and strategic interests. Singapore has invested in finance and services, telecommunications, real estate, auto parts, manufacturing and others.

Prior to the Shin-Temasek saga, the Thai public had a rather positive attitude towards Singapore. Last year was an extraordinary one for Thai-Singapore relations, with the two countries celebrating the 40th anniversary of their diplomatic relations. The city state’s fast and efficient emergency assistance to tsunami victims in southern Thailand won the admiration of the Thais.

When Singapore President SR Nathan visited Thailand in January last year, he said: “For them [Thais], it was important that when there was a need, we turned up.”

From now on, Singapore’s image in this country will be closely linked to this notorious deal and it may hamper future good relations and investment with Thailand. At the anti-Thaksin really Saturday, anti-Singapore banners were visible. The fact that Temasak was willing to undertake such complex negotiations and financial transactions reflects the island’s “win-win” business instincts and its perception of Thaksin and his government.

On the one hand, the Thaksin family has outsmarted the whole nation and avoided paying income taxes. As the country’s strongman, he literally stretched his power to the seams to make this deal.

On the other hand, Temasak was willing to go along with the Shin Corp in using legal loopholes and complicated corperate strategies to secure the 49-per-cent limit on foreign ownership in telecommunications companies. It was hard to comprehend why such a reputable investment agency would do that.

Thai reactions towards the purchase will not die down in the near future so long as the beleaguered prime minister clings to power. Public outcries against Thaksin’s tax-exempt manoeuvring will continue to weaken his legitimacy to rule day by day. As such, it will continue to reinforce the island’s negative image and intensify public resentment in this country and beyond.

When Singapore Deputy Prime Minister S Jayakumar arrives in Bangkok next week for a consultation on the drafting of an Asean charter, he will find a different Thailand, one that is less friendly and more cynical. With such a huge Singaporean stake in Thailand, bilateral relations will have to move to a higher and more secure level with better mechanisms to promote and protect these interests.

For one thing, the deal will also impact on the future of Asean’s economic integration as a whole. It is not wrong to say that with such a gargantuan investment and the high level of cooperation between the two countries, Singapore and Thailand have already spearheaded closer economic cooperation within Asean. While both countries want to see the earliest realisation of the Asean Free Trade Area to gear the region to compete with others, they are also willing to move on and strengthen their bilateral ties.

Fortunately, albeit their political incompatability, Thai and Singaporean leaders have been sharing the same vision on economic development and growing interdependence both among them and within the region. With the morality of Thaksin’s leadership under close scrutiny, this strong sense of camaraderie, which has been carefully nurtured, could suffer a jolt.

Other Asean members, especially those that cherish the principle of non-interference, might not feel comfortable, and find these arrangements threatening to their sovereignty. This could also ignite anti-Singapore sentiment in other Asean countries. It will affect the island’s long term policy of regionalisation in tapping resources and potentials countries in the region.

The Shin-Temasak deal is a rude wake-up call for Singapore, with the reminder that there is an unpredictable political dimension to every business transaction. The island’s decision makers have to be more sensitive and mindful of non-Singapore mindsets and scheme of things

In this case, it is likely that the political fallout will be long-lasting and costly.

Kavi Chongkittavorn