Now that Prime Minister Samak Sundaravej has announced a state of emergency, all sides should look for ways to achieve a breakthrough as soon as possible. However, as Bangkok entered into a second day following the deadliest political violence in 16 years, there appeared little sign of an imminent end to the crisis. Worse still, the unions of several state enterprises have threatened to get in on the act by carrying out strikes to force Samak to step down.

Life went on in Bangkok yesterday as the management of certain state enterprises came out to assure us that there wouldn't be power blackouts or cuts to the water supply. The state of emergency was not actually enforced, thus raising several questions over an alleged split between the Army and the government.

Although the state of emergency has been dismissed as a paper tiger because, for instance, the order to prohibit gatherings of more than five persons is virtually impossible to enforce, its very existence has dampened overall sentiment. In the eyes of the international community, the label gives Thailand a bad image. It carries a lot of weight with foreign analysts and credit-rating agencies. Their comments could affect foreign direct investment and the tourism industry.

In spite of the state of emergency, Army chief General Anupong Paochinda made it clear that the military will not step in to end the political crisis. In fact, Anupong commendably suggested that the crisis should be resolved through the means of Parliament. He also dismissed the use of force to enforce the law, in contrast to Samak's earlier attitude that he preferred to use force to end the protests.

Is Anupong playing politics? If so, is that good for Thailand's political future? Will the Army eventually take the bitter pill and learn to live under civilian rule? Will our civilian leaders ever grow up?

The bottom line is that the Army is a law enforcement machine, not a political entity. A state of emergency requires it to act accordingly, like it or not.

There are growing calls for Samak to quit or dissolve Parliament. Samak may try to hold on, as he can argue that he's not done anything wrong. But as things stand, he does not have the capacity to rule. He cannot control the situation. His state of emergency is seen as a joke.

Political turbulence has paralysed the country for months and the situation should not be allowed to continue. On Tuesday, the baht fell to a 13-month low of 34.50-52 against the US dollar in reaction to the violence that left one person dead. The turmoil has battered Thailand's stock market, which has fallen 24 per cent since protests first began in May.

One can argue that the stock market may not be a real economic indicator, but a more worrisome factor has emerged. Pongpanu Svetarundra, director of the Public Debt Management Office, said yesterday that the government's borrowing in foreign capital markets has escalated sharply. The Finance Ministry official said the cost of overseas borrowing for the government and private sector shot up to a historical high as the political turmoil amplified five-year foreign borrowing costs to 140 basis points over the London Interbank Offering Rate.

In short, the window of opportunity for foreign borrowing is closed for the Kingdom. The political turmoil has hammered the global market's confidence in the Thai market.

Our elected leaders must demonstrate that Parliament is still an institution that commands respect. The anti-government People's Alliance for Democracy (PAD) should also be willing to show compromise instead of triggering massive strikes nationwide. The PAD risks losing public sympathy and the political gains it has made. It needs to make clear to the public what its political objectives are, and, if achieved, whether that would mean an end to its activities.

Samak himself will have to ponder the future of his political career. The clock is now ticking. His political legacy will depend on decisions he will have to make in a matter of days, if not hours. -- The Nation