Thailand’s government is pushing ahead with a reconciliation plan aimed at healing a social and economic divide and forestalling another uprising after the country’s worst political violence in modern history.

The five-point reconciliation plan announced earlier this month calls for protection of the monarchy; reforms to address social injustice; an independent body to monitor media to ensure unbiased reporting; a committee to investigate recent political violence; and political reforms and constitutional amendments.

Prime Minister Abhisit Vejjajiva has insisted he alone will decide if and when a new election will be held. He initially suggested Nov. 14 but that was rejected by the anti-government demonstrators blamed for the violence and rioting.

Below is what could unfold in the next few months.

RECONCILIATION PLAN REJECTED BY ALL SIDES — STALEMATE

Many areas are open to debate and the process therefore never takes off, leaving Thailand in a protracted stalemate with little indication of whether an election will take place to meet a key demand by the now-dispersed “red shirt” protesters.

New leaders emerge within the red shirts and they question Abhisit’s suitability to lead a peace process, holding his government responsible for scores of deaths and injuries to hundreds of people, most of them protesters. An imminent no-confidence motion against Abhisit and several ministers by the red shirt-alligned opposition party, Puea Thai,is unsuccessful but serves to undermine the reconciliation plan.

Puea Thai and the red shirts reject points in the reconciliation plan related to media, the judicial system and a probe into recent violence as one-sided and insincere.

Abhisit’s elite backers, his supporters and the rival “yellow shirts” movement representing urban middle classes, are outraged he is reaching out to the red shirts, whom they brand terrorists for trashing the capital and damaging the economy.

They rejected peace overtures before, so have no place in any reconciliation process, the government supporters say.

LIKELIHOOD: Strong chance this will happen. Compromise and concessions are unlikely in the current climate, where gamesmanship, insincerity and divisiveness have prevailed on all sides.

MARKET IMPACT: Foreign investors might take advantage of cheap Thai stocks during a protracted stalemate, but long-term investment will likely be curtailed as there is no light at the end of the tunnel. Tourists are still apprehensive and consumer confidence would remain low, although the government would have more time to work on economic stimulus measures.

NO SIGN OF EARLY ELECTION, RED SHIRTS REGROUP

Abhisit is unwilling to set an election date. The red shirts are angered by the deaths of many protesters and arrest of their top leaders and vow to fight on.

New leaders emerge, the movement regroups in the north and northeast strongholds and regular rallies take place with a view to a return to Bangkok to reiterate demands for new polls, claiming Abhisit’s rule is even less legitimate than previously.

Sporadic and mysterious gun and grenade attacks similar to those during previous rallies occur on government targets in rural areas and in the capital. The public is on edge, fearing renewed violence, investors and tourists back off.

LIKELIHOOD: This is also a strong possibility. For the red shirts, their grievances have not been met. Lives have been lost and they have come too far to quit now.

MARKET IMPACT: Long-term investors are jittery about signs the defiant reds might return to the capital and cripple the country again. Stock traders are cautious, but while protests remain in the countryside, the risk is lower and foreigners continue to buy.

RECONCILIATION PLAN AGREED BY ALL SIDES, ELECTION DATE SET

After a few months of debate, the reconciliation plan moves ahead and Abhisit sets an election for later this year, perhaps December or even January. All sides pledge to remain peaceful, honour the result, refrain from protests and vote-buying and allow unhindered campaigning.

Political machines go into overdrive. Campaigning is heated, sporadic but low-level violence takes place, cries of foul play or intimidation ensue, setting the stage for disagreement over the result and potential for more protests, stalemate and violence.

LIKELIHOOD: Disagreements and a bumpy ride in the run-up to polls are very likely. However, to get to this stage in the first place is a tough task, since an agreement on polls and the peace plan will likely remain elusive.

MARKET IMPACT: This scenario gives a lift to markets, the baht and the economy, but investors are concerned about what will happen after the election and many remain on the sidelines. The government is able to work on economic reforms in the meantime.

ABHISIT STEPS DOWN DURING STALEMATE, NEW PM VOTED IN

Abhist’s peace efforts are shot down and he is no longer seen as the man to heal Thailand’s rifts. An alternative from his coalition, probably a junior partner, acceptable to all sides, including Thailand’s establishment, is voted in.

The new premier, who serves almost like a caretaker, sets an election date. All sides realise this is a chance for both power and peace and vow to play fair in the run-up to polls.

LIKELIHOOD: Not very likely. Despite widespread criticism from red shirts and even his supporters, Abhisit remains the best bet for the real power-holders in Thailand — the military and the elite. He has again succeeded in keeping the red shirts at bay and knows he has strong backing. He is unlikely to step down.

MARKET IMPACT: Markets won’t mind a short-term government as long as it keeps the peace. The economy would benefit if it debilitating protests are stopped. Peace would allow stimulus measures to take shape and consumer confidence would rise. Banks, property and transport-related stocks climb as a result.

(Editing by Raju Gopalakrishnan)