A Bangkok criminal court on Tuesday ordered Thaksin Shinawatra, the polarizing former prime minister who remains a dominant figure in Thai politics, to serve a one-year prison sentence, saying he was guilty of offenses arising from a long-running legal dispute. The 76-year-old was escorted from the courthouse after the verdict, which his legal team said they would immediately appeal.

The ruling was delivered in a case that has traced back to allegations tied to decisions made while Mr. Thaksin held office, and comes amid renewed scrutiny of the former leader’s influence over parties and politicians aligned with him. The presiding judge said the court’s decision followed a full review of evidence and was bound by statute, while declining to comment further in court.

Outside the courthouse, a lawyer for Mr. Thaksin called the conviction “politically motivated” and said the defense would pursue appeals through Thailand’s higher courts. “We are confident the higher judiciary will correct this,” the lawyer said. Supporters staged small demonstrations in parts of Bangkok, while opponents hailed the decision as a demonstration of the rule of law.

Markets responded quickly. The Stock Exchange of Thailand fell about 2 percent in early trading on Tuesday, led by declines in consumer and telecommunications shares tied to political sensitivity and domestic demand exposure. The Thai baht weakened roughly 0.6 percent against the dollar, while short-term government bond yields ticked up as investors booked profits and moved to safer assets. Local equity strategists estimated foreign net selling in the hours after the ruling ran into the hundreds of millions of dollars.

Economists warned the decision could heighten political uncertainty at a time when Thailand is trying to rebuild investor confidence and sustain tourism-led recovery. “Markets hate policy ambiguity,” said Apichai Ratanakul, chief economist at a Bangkok research firm. “This ruling increases the odds of short-term volatility and makes the task of a fragile coalition government that much harder when it comes to delivering consistent economic policy.”

Policy risks are tangible: Thailand’s governing coalitions in recent years have been narrow and dependent on shifting alliances, and Mr. Thaksin’s political networks have been influential in parliamentary maneuvering. The ruling could prompt renewed realignments ahead of local and national contests, and complicate plans for structural reforms aimed at attracting foreign direct investment and raising productivity.

Longer-term, analysts say the verdict underscores a broader pattern of political cycles that have periodically interrupted Thailand’s economic trajectory since the 2006 coup against Mr. Thaksin. The International Monetary Fund’s most recent projections had put Thailand’s growth at close to 3 percent for the year, a modest pace that leaves limited room to absorb shocks from renewed political turmoil. Tourism, which accounted for a significant share of pre-pandemic output, and export performance will be key variables to watch as investors reassess risk.

For now the immediate question is legal and political: how swiftly appeals will proceed and whether the sentence will prompt larger street protests or parliamentary shifts. Both will be watched closely by markets and foreign investors as signals of Thailand’s ability to maintain policy stability and economic momentum.