Thailand’s new Prime minister started work on yesterday with pledges to focus on national reconciliation and “people’s happiness” in the wake of last month’s military coup against Thaksin Shinawatra.

After a blessing ceremony with a senior monk, retired general and devout Buddhist Surayud Chulanont moved into the Government House offices that have been empty since the September 19 putsch, Thailand’s 18th in seven decades of democracy.

In a hint of the troubles that might lie ahead for the respected former army chief, the stock market slipped amid fears from foreign investors that he will be a puppet of the military, who remain in the fray as a Council for National Security (CNS).

The baht, which fell to a 6-1/2-week low after billionaire telecoms tycoon Thaksin was deposed, held steady despite comments from Surayud that suggested a focus on healing social divisions before boosting economic growth. “I don’t think it will affect the market that badly but it is going to make people think twice before putting money into Thailand because they don’t know him, and that is a problem,” said Marco Sucharitkul of JP Morgan in Bangkok.

Surayud said his one-year tenure, which is meant to keep the country ticking over while a new constitution is drawn up, would focus on a «self-sufficiency» economic model espoused by revered King Bhumibol Adulyadej after the 1997 Asian financial crisis.

His cabinet, which should be appointed in a week, is sure to be scrutinised by investors wanting to see how serious he is about the economy — and foreign governments and rights groups wanting to see how free he is of army interference. The US ambassador was among his first official visitors. The tanks returned to barracks within minutes of the stop-gap constitution being announced, but the coup leaders under army chief Sonthi Boonyaratglin are still very much in the fray.

As CNS president, Sonthi has the power to hire and fire governments and will appoint members of the 2,000-strong People’s Assembly that will start work on a new long-term constitution.

The army will also vet the final draft of the constitution before it is submitted to a national referendum in about nine months, according to the generals’ “roadmap to democracy”.