The Bank Of Thailand Then And Now

[Mid]

OPINION / MANAGING THE ECONOMY

Recent changes have put the central bank back in the precarious position of being subject to political pressures

By THITINAN PONGSUDHIRAK

A decade after its debacle in mismanaging the baht, from a century-long peg to a forced flotation that brought on the infamous and contagious economic crisis in 1997, the Bank of Thailand has come full circle. Legal efforts after the 1997 crisis to free the central bank from political interference by amending the Bank of Thailand Act have come to naught. Recent BoT interest rate cuts in response to blatant government preferences to boost growth are an indication that the central bank's macro-policy autonomy and management has been reversed back to its pre-1997 position.

It is an ironic turn of events because the finance minister behind the reversal is none other than Chalongphob Sussangkarn, a pro-market career academic economist and a would-be technocrat who is in office during an interim, unelected government under military rule. Mr Chalongphob, in effect, is supposed to be a technocrat on the side of the BoT, but instead he has practically put the central bank back into the hands of elected politicians who will come to power after the election.

The Post Publishing Public Co

Edited July 2, 2007 by Mid

[Mid]

BoT chief affirms monetary policy implementation on right track

Monday 2 July 2007 02:25:48 PM (GMT+7:00)

BANGKOK, July 2 (TNA) – Bank of Thailand governor Tarisa Watanagase on Monday affirmed the central bank was on the right track for its implementation of the monetary policy, saying it could cope with a new crisis if it broke out again.

Speaking on the 10th anniversary of the floatation of the baht, which falls on July 2, she said the current economic environment is different from that happened 10 years ago when the country experienced the economic crisis and the bank changed the currency exchange system to the managed float from the basket of currencies.

MCOT Public Company Limited

Edited July 2, 2007 by Mid

[A_Traveller]

After 10 years they still sing the same old {false} song.

Thailand experienced the worst economic crisis in 1997 when it was forced to abandon its fixed exchange rate after coming under massive speculative pressure. (TNA)

Regards

[chinthee]

Oh no, that's no way to celebrate a 10 year anniversary!