Eric Loh

The same bumbling government will be deciding on our charter and economy. Scary future.

Doubt any military officials on the list.

Well, until Prayut orders them (again) to do so.

http://news.thaivisa.com/thailand/thai-govt-tells-bot-to-manage-baht/51025/

Like a gentle remainder who is boss or else he will lay 44 on BOT governor. Under such circumstance, independence of the BOT was compromised.

Fitch report on Thai Baht

05 May 2015 9:30 PM

Thai Rate Cut No Panacea for Feeble Economy

https://www.fitchratings.com/gws/en/fitchwire/fitchwirearticle/Thai-Rate-Cut?pr_id=984161

Fitch Ratings-Hong Kong/Singapore-05 May 2015: The Thai central bank's decision last week to cut the policy rate and relax capital account restrictions highlight the persistent weakness of Thailand's economic outlook, says Fitch Ratings. Thailand's credit risk profile balances the country's relatively weak macroeconomic performance against a strong policy framework, and the recent policy action does not change that fundamental assessment.

The Bank of Thailand (BoT) surprised the market by cutting the policy rate by 25bp to 1.50% on 30 April, and then eased rules on Thai residents' foreign investments and non-residents' ability to borrow in baht, effective 1 May. The central bank's decisions came as weak demand and production indicators point to a lackluster economic recovery after growth fell below 1% last year amid political uncertainty and disruption.

Fitch expects Thai real GDP growth to accelerate to 3.5% and 3.7% in 2016. However, structural issues, including relatively high household debt and lingering political uncertainty weigh on domestic demand, and could turn out to be more serious in their effect than current forecasts anticipate.

The central bank cited the strength of the Thai baht to explain its rate cut. This was unusual as the BoT has not recently cited the exchange rate as a driver of monetary policy actions. The baht appreciated 4.3% on a trade-weighted basis in 1Q15, compared with a 1.1% depreciation for the median of 22 major emerging-market economies. This was in part caused by Thailand's hefty current-account surplus, which was USD8.2bn in 1Q15. This, in turn, reflects the weakness of domestic demand. This will contend with the announced measures to spur capital outflows in exerting an influence on the currency.

A cheaper baht is unlikely to be a panacea for Thailand even if it can be achieved. Gross exports in Thailand have not grown since 2012, according to official data, suggesting a broader, structural decline in competitiveness. We highlighted the ability of Thailand's export industries to improve their competitiveness as a potential key factor that affects ratings in our recent sovereign review published in April.

The ability of rate cuts to spur demand is also likely to be limited by the already high level of private-sector indebtedness. Bank credit to the Thai private sector totaled 159% of GDP in 2014, up from 113% in 2008. That is substantially higher than the median 61% of its 'BBB' rated peers, and even tops the medians for 'A'-rated (107%) and 'AA'-rated (110%) sovereigns. Household indebtedness is likely to drag on consumption.

Thailand's net international investment position (NIIP) is negative as foreign direct investment into Thailand - counted as a liability - more than offsets the country's net asset position in debt-like instruments. Easing capital account restrictions to facilitate cross-border capital flows could boost Thailand's NIIP over time. But Fitch sees limited upside from this for the credit profile as we already regard Thailand's external finances as a strength. A large current account surplus, status as a net external creditor in debt-like instruments, and robust external liquidity buffers provide the economy substantial protection from external shocks.

The BOT has in the past resisted calls by Finance Ministers to cut or increase the rate and have always stated that the exchange rate was never a driver of monetary policy. This time they relented and I suspect that the independence of BOT has been compromised. The knee jerk reaction may benefit Baht depreciation but judging from the USA muted economic results and their high budget deficit plus the positive current account that Thailand enjoyed, the Baht will gain strength eventually.

Eradication of the establishment foes and not preventing a civil war or bring happiness back was the purpose of the coup. Has been the reason for past coups too. Some gullibles here still think this coup was different.

Prayuth doing himself no favor again by reacting and responding off the cuff. A crackdown is just a short term partial knee jerk solution. He should gather his thoughts and consult and provide a more holistic solution like some posters mentioned like stricter law enforcement, harsher punishment as deterent, fast track prosecution of the guilty, stricter control of clubs beyond official closing time, social awareness campaign, review safer bikers lane.

When I heard that the camp was in Padang Besar, I was suprised that it was not detected. This border town is very small and has a population of less than 15,000. How could foreigners and movement not detected in such a small border district is beyond me. Only reason I can think off is that it has been protected by the municipal top guys with cooperation of the local police and the military stationed in the south. That the camp was located so near to the Malaysian border hint strongly that they were heading to Malaysia where they are better suited as Muslim. There are Malaysian working hand in gloves with the Thais and it will be better for the PM to work with the Malaysian authority to put a stop to this permanently.

Really the laugh is on the military and made a fool of themself. First they thought it was live and actually went searching for the General. First laugh. It was actually a repeat broadcast with the first broadcast on Wednesday morning. Second laugh. Above all,the interview had nothing to do with the UDD or even the charter. Reserved the biggest launch for the junta arse kissers here. It was about the restive south.

I sense that the independence of BOT has been compromised.

Ricardo, you are defending the democractic value of a man who boycotted 50% of Thailand general election held under his leadership. I remembered back in December 2013 on CNN, he unequivocally said that he would "welcome an election and that it is the first step towards trying to solve the country problems". 2 weeks later, he boycotted the election.

It's not unusual for Thai politicians to say one thing, then do another, especially in the run-up to an election.

I think (and did say) that he was wrong to take the Dems out of the February-2014 election, where I think PTP would have done quite badly. He should have let Suthep quit the party, to lead his campaign, and carried on within the system. But he didn't, the whole elected-party had quit, supporting Suthep when they'd already forced an election. But was that his tactical-error, or just something which he had to live with, once they'd resigned as MPs ?

You're saying that he was conveniently used, then thrown away, and is actually weak and lets others dominate him, yet here he is standing up and saying something which will be unpopular with the military & amart, which takes courage IMO.

The popular Red view, which I'm not necessarily attributing to you, is that he is a total puppet for the military, but that doesn't square with what he's doing now, does it ? You view it as him being cast aside, once his usefulness is passed, I believe it might be genuine conviction.

There are times when he does act like a Western-educated leader, and stands up for what he thinks is right, this makes him stand out from other former-PMs like Samak ("did you have vigorous sex last night ?") or Somchai (who was playing golf in Chiang Mai while Rome burned Bangkok was in turmoil) or Yingluck ("pity me, how badly my family has been treated, smirk three times !").

I would argue that he's been the best, of a pretty bad bunch, in recent times !

He does seem to keep standing up, and saying things which make sense, like this criticism in the OP. Would you say he's wrong about that ? Does he believe what he's saying, or is he merely following orders from above, would you say ?

Not the first time that Ahbisit made a statement of clear principled intention and then do something totally undemocratic later.. His political life time as leader of the Dem Party has been full of half truth and insincerity. I am also not taken by his facade as a good orator as it is the content that really count. To me he is much like a chameleon and have made very poor major judgement and decision. In politics it's suicidal and have hurt his credibility for his politial life time. I still think that he should step aside as he carries just too many political baggages and liabilities for his party.

Ricardo, you are defending the democractic value of a man who boycotted 50% of Thailand general election held under his leadership. I remembered back in December 2013 on CNN, he unequivocally said that he would "welcome an election and that it is the first step towards trying to solve the country problems". 2 weeks later, he boycotted the election.

This is surely further evidence, that former-PM Abhisit and the Dems are totally in-the-pocket of the amart ... and that his strings are being pulled by the military, erm ... erm ... right ? [/

Heard of the term that in politics there are no permanent friends or enemies? He was conveniently used for that moment of political times and now cast away when he served no useful role inthe current setup. Ahbisit really has little democratic principles and many times have compromised with undemocratic force to make his political gains. It's unfortunate that such an educated man and a life time career as a politician is actually weak and allowed others to dominate him in party and national politics.

Is ASEAn still menat to be implemented this year ?

ASEAN was implemented since August 8 1967. Think you meant AEC.

They government has almost impossible situations on their hands. Past governments and state officials have done little or nothing to correct them and now they are all falling into the General's hands at about the same time. I hope he can resolve them. I don't envy his position.

He didn't have to take on the role of PM, a poor tradesman always blames his tools!! You reap what you sow and deflecting it back to the previous inept crowd is expected from a particular quarter. He was warned about the impact of Martial Law on the economy by REAL economists and financial experts and he dismissed these as being anti junta and that nobody understood Thainess or the situation in the country.

There is NOTHING stopping him from stepping down and bringing in a cabinet where he has the experts, the losses occurred in the Thai economy due to the coup have been Staggering if the economic experts outside of Thailand are to be believed.

Bottom line, it's happening on his watch, he and he alone brought in people like Kobakarn and put his buddies in positions they had no experience in.

Yes he inherited a mess, but he wanted that position so badly, and now has ultimate control with no accountability with article 44, he has to accept the bad shit along with the good!!

Knowing his demeanor, the man is just too proud to step down or even ask for help from technocrats. I will give him credit for trying but honestly he and his generals are totally inadequate in collective skill and expertise to solve the economic and political headwinds. His only solution is to have the election as soon as possibility can even if it means another 8/9 months of economic struggle and an ugly charter. I also think the EU will give an extension to the outright ban if the junta show some degree of efforts inner-structuring the fishery industry. Really to expect a result in 6 months is purely insane and not possible.

Government should respond with a robust and unprecedented stimulus package to help the export sector. So far we have not heard of any. So much the government can do like tax reduction for equipments, capital injection, liquidity provision, cut in export duties and excise tax, government delegations to seek more markets etc etc. unfortunately none seen or forthcoming. Anyway, if generals can run the country, then we don't need an army.

_{Last week, Jatuporn Prompan, leader of the Redshirt movement's official umbrella organization, called for postponing the election in order to address the new charters undemocratic nature, including a clause that allows MPs to appoint an unelected Prime Minister, the establishment of an unelected Senate, and the establishment of powerful unelected "independent" agencies.}

_{Jatuporn Prompan.......................................... and who elected him to anything ? what gives him the mandate to speak at all}

Ahbisit said the same thing. Are you going to lash at him or you just being selective as always.

Not hard to see that Thailand will struggle and 3% growth rate will really be a bonus. Export which is 70% GDP has structural issues and unlikely to be resolve this year. Domestic economy remain sluggish with little stimulus package from the government and consumers burdened with high household debt and political uncertainty. Only tourism is the bright spot but is tiny portion of GDP.

Is the weak Baht the only reason why export is suffering? I say it's not the only reason except for a very few local produces. Most exporters variable costs like raw materials and equipments are imported and the strong Baht reduced their production costs. Even agriculture products used lots of imported fertilizers, pesticides and farm equipments that are imported. Is this a question of producers greed for more profits and big international/local companies that import the products are not lowering their prices proportionately to the local producers.

So really it's a question of the government inability to solve the local problems and the BOT really has not much influenced over the grand scheme of things. Government can do more to look into price gouging and implement schemes and benefits to help affected companies to lower the fixed costs like reviewing export taxes.

Also a question of poor coordination of government policies if they acknowledge strong Baht is the problem. For example, here we have the Finance Ministry officially asking and encouraging Laos, Cambodia, Mynmar and Vietnam to use Baht denominated Bonds for their infrastructure investment fundings. Laos have already mobilized 9.5B Baht and raise the Baht funding from Thailand capital market. This buying of Baht denominated bonds will raise Baht strength. Bottom line, this govenment is totally lost in all economic matters.

Internal factors seen as major risk. Mmmmm, could that be the coup? Just guessing.

Gift wrapped solution to find the extra tax revenues. Just dropped that foolish petition. Perhaps bring this up when economic times are better and when we have an elected government.

1st generation is getting long in the tooth. Not running the latest software adds a second reason to replace. I'm thinking that would be the best especially if you have everything on iCloud anyway. It would all be available on the new device.

Recently cracked the glass on my iPad 2, purchased in 2011. Apple repair here in Chiang Mai said they just send it in and a reconditioned replacement is sent at a cost of 8800 baht. Too steep for me. Went to another generic repair shop and they said, one hour at a cost of 2000 baht. So, that is what I did. I can squeeze a little more time out of it although the wife is waiting patiently to inherit when I buy the new replacement this year.

Wise of you but still not cheaper than Seer along Vivawardi Rangsit Road which did my screen change for 1,800 in less than an hour. Checked with the official iPad service center and same screen change will cost about 4,000B. In conclusion, if OP wants to repair, suggest get down to Seer.

Let me guess, you're struggling to make ends meet from a measely income from outside of thailand, looking for someone to blame. So you decide to blame the exchange rate and convinced yourself the BoT is manipulating exchange rates even though you have no evidence whatsoever and clearly it would be in their own interest to do the opposite of what you are accusing them of doing.

Here's the truth. Thailand is a net importer of oil in the amount of about 12% of it's GDP. 12months ago they were paying $110 a barrel for oil they import. Today, they are paying half that amount. Effectively, saving the country 6% of GDP by money that is not flowing out of the country to pay for imports. Simply put, thailand is saving about $1bln to $1.5bln each month on their Balance of Trade. So even if thailand's exports flatline, the fact their imports costs less will add to the appreciation trend for the Baht.

Because of this, BoT may in fact be intervening in the currency. But not trying to make it stornger, they could possibly be doing the opposite, slowing down the appreciation. ]

So please stop your garbage talk about how it's a conspiracy that BoT is trying to make the Baht stronger (trying to kill their own economy perhaps?). You just sound like a pitiful conspiracy nutter.

Just that simple - right ?

it might be of interest to note that Thailand is primarily an exporter, tourism alone which is in fact an export accounts for more than 12% of GDP - then there's the rest

also using words like garbage and nutter when referring to other peoples input on this forum is far from constructive

as for myself it matters not a jot what the exchange rate is as I have a choice of using baht or my home currency

Yes, using those words is not constructive, I agree. But let's consider the facts. Here are 3:

1. There is no evidence whatsoever that they are intentially trying to make the Baht stronger

2. There is no motive to make the baht stronger, becuase it would simply damage the Thai economy by doing so.

3. There is a perfectly rational explanation explaining why the Baht could have a bias toward appreciating - which I outlined in my post above.

So, No evidence, No motive, and a simple explanation for the Baht's current level. What do you have except crazy conspiracy theories?

1. There is no evidence whatsoever that they are intentially trying to make the Baht stronger

never said there was - it was an opinion based on the fact that some of the richer Thais could benefit

2. There is no motive to make the baht stronger, becuase it would simply damage the Thai economy by doing so.

it is damaging the Thai economy, I thought that was obvious

3. There is a perfectly rational explanation explaining why the Baht could have a bias toward appreciating - which I outlined in my post above.

In your opinion

So, No evidence, No motive, and a simple explanation for the Baht's current level. What do you have except crazy conspiracy theories?

yours is a theory too

and look I replied to your post without the inclusion of one personal insult (no need for it), insults and personal attacks have no place on these forums - all it takes is one person to start and the thread goes down a meaningless pit

I'm not going to insult you Smedly because you normally post sensible stuff. But not here.

You posted your conspiracy theory about the BOT and Prasarn and other posters have asked for some evidence. You have provided none.

Yes the strong Baht is not good for many expats and some tend to post unverified accusations because they are hurting personally, with the country being of secondary (or worse) importance.

Thai At Heart posted a very sensible take on the issue which I agree with. Remember AFAIK the Thai Baht rate is based on a basket of currencies with the US$ obviously being the largest.

Finally a sensible post. Totally agreed with the point that Baht based on basket of currency of which USD is the most dominant and their movement influenced Baht immensely. Technically the BOT can manupulate the Baht with the large cache reserve Thailand has built up but doubt the junta government will allow that move. It will bring undesirable consequences like inflation, higher payment for foreign currency loans and confidence to the people. Things the junta trying to avoid.

"Democratic Path and What we can Learn from Nuamthong Praiwan".

Maybe the lesson to be learned is not to mob up and barricade themselves in the main commercial district of Bangkok and fire M-70 grenades at BTS stations, invade hospitals, burn shopping centers, etc., but instead, just go home and hang themselves in protest. It would send a lot clearer message and wouldn't negatively impact a lot of folks just trying to earn a living.

Of course, the best way to follow the 'Democratic Path' is to just wait for the next scheduled election and vote in their Dear Leader peacefully

Get a grip. That was in 2006 and the mob up was by the PAD who wanted a coup. They got one and this lone brave man was a true soldier of democracy unlike the fake one now.