World Bank Slashes Thai Growth Forecast To 4.3 Percent

[solo siam]

4.6% TO 4.3%???

I would hardly call that "SLASHED", surely dropped by just over 5% would be fine, Its still a larger figure than most of the world, and in regards to Asia, excepting KH, Singapore and Taiwan, Thailand has one of the largest GDP's , hence its unlikely to grow as much as Vietnam, Cambodia, China etc...

[LaoPo]

Why does all posting here about the strength of the baht revolve around the dollar?  When I speak to my partners about this (we have lost many sales because of the increase in the baht), they like to blame it on Bush.  However, that ignores the rise in strength of the baht against the yen, euro, won, yuan, etc.  Are all these due to US policy?  Seems to me that the yen and the yuan have been able to manage their currencies against the dollar, and the baht's rise with regards to the euro can't be because of US policies.

I was a business professor for 10 years, teaching MBA and doctoral candidates, so I am not totally ignorant about monetary theory. But the continued strengthening of the baht baffles me. I just don't get it.

 

I'm afraid you're not the only one Professor.

The expensive Baht doesn't make sense at all.

It's bad for Thailand.

It's bad for the Expats

It's bad for Export

It's bad for Import

It's bad for the Thai People (in the end)

Data of the rise of the Baht versus the major currencies in the last 12 months:

US$ - Baht

Pound Sterling - Baht

Euro - Baht

So, why did a minor world currency like the Thai Baht gained so much strenght against 3 of the major world currencies ?

I've read many possible scenarios here on TV but I'm not convinced so far about the real reasons and facts...

If the Thai 'junta' and it's interim government don't take DRASTIC steps in the next few months I fear enormous problems inside Thailand; it will start within the rural areas of Thailand where 49% of the Thai Labor Force produces a 'mere' 10% of the GDP....and that's bad....very bad.

The farmers (who suffer most) will organize a major uproar...

We'll see if the "Top' is able to handle the problems...

LaoPo

[solo siam]

How is a strong baht bad for import? We import products and they are now cheaper.

Its not necessarily bad for exports either, especially if a company imports raw materials.

I fail to see how its bad for all expats as well, If for example you earn money here through work, or renting out property - surely a strong baht is a great

thing, I know a couple of people who have managed an extra holiday going home this year due to just that.

At the end of the day the baht is now a stronger currency than before, its worth whatever the market and people will pay for it.

Besides surely this means that the GDP and GDP per capita of Thailand has gone up more than say 15% in the last year in dollar terms.

[xbusman]

The strong baht has been great for imports. I have turned a 100% export orientated business into a 90% import orientated business. Harley motorcycles are approaching the point where they are cheap cheap and I cant get enough of them. Its been a great shift. No more dealing with unreliable vendors, poor infrastructure, and VAT retention by the Thai government. Instead, I drop a Harley on the ground, collect my money, and move on with little to no stress.

I am just one little guy who was able to adapt quickly and easily to the rapid change over the past two years. I know the lumbering giants will follow the exact same direction but take years longer to make the decision and implement the action. I make my living by being quicker. Meanwhile, all my old vendors who manufacture in Thailand are beginning to move their manufacturing to China or are putting their money into... you guessed it, PROPERTY SPECULATION. These changes are slow and long term. I believe over the next five years we will watch the evaporation of 60% GDP based on exports. The big question is what will replace it because it will only become painful if there is nothing to fill the vacuum. Either the baht will snap back to a competitive level with the Remimbe (remember that the problem is not that the baht is too strong to the dollar, its that the baht is too strong to the remimbe) or the worlds largest oil reserves will be discovered under Pattaya or Thailand will develop into the world center for nano technology. The alternatives are dreadful.

[lannarebirth]

The US is seeking for oil, and any excuse is good enough. I'm not protecting muslims here who on their own fight for oil also...

One doesn't need an IQ of 167 to realize that the US is looking for any excuse to spend money. War just happens to be one of the most expensive endeavors for doing so.