Surayud might have only one chance left to prop up his Cabinet. He can no longer appear wimpy. One more mistake is likely to result in him losing his premiership. There are reports of political infighting within the military leadership. Surayud is caught in the middle of this power struggle, which has further complicated an already difficult situation.To be sure, determining who will take over the finance portfolio is the most important decision Surayud must make in his impending Cabinet reshuffle. At this hour, we see MR Chatu Mongol Sonakul as the only remaining choice on the table. Nobody is more suitable than Mom Tao, as he is commonly known, to manage the country's sagging economy and to restore confidence.

Installing a young face or a novice would not work, because the new finance minister must have the guts and the will to go after cases linked to the previous administration. He must also be able to stand firm against the meddling of vested interests. And he must also have the credibility to save the economy from sinking further.

Chatu Mongol is an ideal candidate to come to the rescue of the country. He served the Finance Ministry for 30 years, rising to the top post as permanent secretary. He has the best knowledge of fiscal policy among other potential candidates. Mom Tao also served as the governor of the Bank of Thailand for three years in the aftermath of the 1997 financial crisis. He restored credibility to the central bank, introduced inflation targeting and also engineered a monetary-loosening policy that was crucial to the economic recovery that followed.

Once Surayud has appointed Mom Tao or another capable person to the finance portfolio, we expect the new finance minister to make tough decisions on a series of policy measures.

First, the new finance minister must remove the 30-per-cent reserve requirement. This measure has been a major blow to investor confidence. While Mom Tao was serving as central bank governor, he used his own reserved power to persuade foreign bankers and currency speculators not to speculate against the baht. His credibility also won over the financial markets, which did not react negatively when he started to bring down interest rates at a time when Thailand was still suffering from the bleeding of capital outflow.

Second, the new finance minister must stimulate the economy by making sure that the fiscal budget is disbursed in a timely manner. The Thai economy is now facing a slump. Consumption grew by only 0.6 per cent in January compared to the same period last year. Private investment dropped by 0.5-0.6 per cent during the same period, the first slump in five years.

Without fiscal stimulus, there is a danger that the Thai economy might be damaged beyond repair. Fiscal disbursement has been rather slow. The Finance Ministry has projected that if disbursement reaches 93 per cent of the total Bt1.56-trillion budget, the economy will be able to grow 4 per cent. In the first four months of this fiscal year, beginning in October 2006, the disbursement slowed down by 20 per cent compared to the same period last year, due in part to the political deadlock and also in part to bureaucratic red tape.

Only with a combined monetary-loosening policy and fiscal stimulus will the new finance minister be able to prevent the economy from slumping further. Surayud now has only a narrow window of opportunity to appoint a capable finance minister to help him not only salvage his government but also to save the country as a whole. We believe that nobody is more suitable than Chatu Mongol at this time of clear and present danger.