Surprised or not with the large number of abstention votes cast in Bangkok constituencies, businessmen and economists are now hoping for an early end to the political chaos in fear of its lingering effects on the economy.

Even without the political chaos, the Kingdom's economy is beleaguered by many problems - the upward interest-rate cycle that puts a brake on domestic consumption, lacklustre export demand in countries other than China, declining tourist arrivals and, importantly, the high oil prices.

To date, oil remains above US$60 (Bt2,335) per barrel, against the forecasts of Thai authorities that it will average out at between $50 and $55 for the entire year.

If oil remains above the $60 level throughout the year, this will inevitably affect the official growth forecast, which currently lies somewhere between a best case of 5.75 per cent and a worst case of 4.75 per cent.

In the past three months, global crude oil prices averaged $59, and this has had a huge impact on inflation. In March alone, the consumer price index rose 5.7 per cent, year on year, due to the escalation of oil and food prices.

According to the World Bank, Thai gross-domestic-product growth of 4.5 per cent last year was the lowest in Southeast Asia. It compared with 8.4 per cent in Vietnam and 6.4 per cent in Singapore. This year, it is also expected to lag behind neighbouring countries, at an extimated 5 per cent.

Political chaos only widens the list of negative items.

After Sunday's general election, several businessmen voiced their concerns over political events still to come over the next few months. These include the question of when the election will really be completed - as by-elections have to be held in many constituencies - and whether Thaksin Shinawatra will remain prime minister.

In their perception, if Thaksin stays on with only a small margin, his mandate for running the country will not be as strong as it was previously. This will inevitably affect key economic policies, and particularly the Bt1.8-trillion mega-project investments, which were earlier expected to contribute largely to economic growth from this year onward.

An official in the Finance Ministry has also pointed out that there could be a problem with the disbursement of the 2007 budget when the fiscal year starts in September, because there may be no government to approve the Budget Bill. The new government's key focus will be on political reforms, and this will deliver a heavy blow to public investment.

Meanwhile, the Bank of Thailand has so far remained bullish on the private investment outlook, saying that as the average capacity utilisation exceeds 70 per cent, it is time for investment to increase that capacity. But an economist who asked not to be named said that in the midst of uncertainty, foreign investors would delay decisions to pump money into the Kingdom.

"They will make decisions only when the political chaos is completely settled," he said.

Exporters may soon also feel the pinch as orders could be shifted elsewhere on fears that the political chaos may disrupt companies' operations and prevent them delivering goods.

Domestic consumption could also drop as consumers, already suffering from high oil prices and high inflation, lose their confidence. This would adversely impact economic growth, given that domestic demand has played a dominant role in boosting expansion.

Amid the negative outlook, several securities houses have slashed growth forecasts due to the expected absence of the mega-projects.

UBS Securities expects the infrastructure projects to be put on hold, despite predictions that they could add up to 1.7 per cent to headline gross domestic product. As a result, the securities house has slashed its 2006 economic-growth forecast from 5.4 per cent to 4.8 per cent.

Anticipating the absence of the mega-projects and amid lacklustre private consumption and private investment, KGI Securities (Thailand) has also revised down its growth forecast from 5 per cent to 4.5 per cent.

More revisions could follow if the turmoil is not solved in a short period, say three months. If not, Thailand could be dragged even further behind its neighbours.