Thailand's embattled Prime Minister Paetongtarn Shinawatra was facing the prospect of losing her government's majority on Friday as a vital coalition partner looked set to demand her resignation after just 10 months in power.
Paetongtarn, the politically inexperienced daughter of divisive tycoon and former premier Thaksin Shinawatra, is fighting fires on multiple fronts, struggling to breathe life into a stagnant economy facing steep U.S. tariffs and under pressure to take a tougher stand on a territorial row with Cambodia that has seen their troops mobilise at the border.
The United Thai Nation party, the second-largest partner in her alliance, will demand Paetongtarn, 38, step down as a condition for it to remain in the Pheu Thai Party-led coalition, two UTN sources told Reuters, requesting anonymity because they were not authorised to speak to media.
"If she doesn't resign, the party would leave the government," one source said. "We want the party leader to tell the PM as a courtesy."
Though Paetongtarn received a boost on Friday with another coalition partner, the Democrat Party, pledging its support, Thailand's youngest premier is still in an untenable position, with her majority hinging on UTN staying in the alliance following Wednesday's exit by the larger Bhumjaithai Party.
UTN has not said when it will announce its position. Asked about its decision, UTN spokesperson Akaradej Wongpitakroj declined to provide details. "We have to wait for the party leader to inform the prime minister first," he said.
Reflecting concerns in financial markets, the Thai baht THB=TH weakened for a fifth consecutive session on Friday and was on course to log its worst week since late February.
TUMULTUOUS PAST
Paetongtarn's battle to stay in power demonstrates the declining strength of Pheu Thai, the populist juggernaut of the billionaire Shinawatra family that has dominated Thai elections since 2001, enduring military coups and court rulings that have toppled multiple governments and prime ministers.
But Paetongtarn is facing domestic anger and the prospect of an internal revolt over Wednesday's embarrassing leak of a phone call between her and Cambodia's influential former leader Hun Sen - once seen as a Shinawatra family ally - which her critics say posed a threat to Thailand's sovereignty and integrity.
During the conversation, Paetongtarn called for a peaceful resolution of the border dispute and disparaged an outspoken Thai army general who she said "just wants to look cool", a red line in a country where the military has a high profile and significant political clout.
Political activists met on Friday to schedule a major protest in Bangkok starting on June 28 to demand Paetongtarn resign and coalition partners leave the government. Those included groups with a history of crippling rallies against Shinawatra administrations.
Paetongtarn has not commented on the turmoil in her government and has tried to present a united front on the Cambodia issue, appearing on Thursday alongside military chiefs and vowing to defend sovereignty.
The premier will make a morale-boosting visit to military units at the Cambodia border on Friday, where she is due to meet Lieutenant General Boonsin Padklang, the regional commander whom she criticised in the leaked call.
Paetongtarn's options for staying in power are limited unless her allies can succeed in behind-the-scenes horse-trading to keep her alliance from crumbling.
A snap election could damage Pheu Thai at a time of dwindling popularity and play into the hands of the progressive opposition People's Party, the largest force in parliament.
Two Pheu Thai sources told Reuters the party is confident Paetongtarn can avoid resigning or dissolving parliament and her government is considering a major cabinet reshuffle to fill vacant positions.
