Bank of Thailand boss appears critical of the new government’s policy initiatives on the economy

[webfact]

Bank of Thailand Governor Sethaput Suthiwartnarueput spoke at a conference in Bangkok last Thursday, where he was forthright in his views about the current policies pursued by the government of Prime Minister Srettha Thavisin, which were not complementary or supportive.

Sethaput Suthiwartnarueput has emphasised, for instance, that the central bank does not approve of using digital assets to pay for goods and services, an approach which appears to be at odds with the latest details emerging on the government Digital Wallet proposal which speaks of blockchain-linked tokens being used to make purchases in a designated 4km radius through an app. 

The Bank of Thailand Governor Sethaput Suthiwartnarueput has in the last week appeared highly critical of the policies being pursued by the incoming government including the planned ฿10,000 Digital Wallet giveaway, a wide-ranging debt moratorium for three years and the emphasis that the new cabinet is placing on achieving ramped up GDP growth. It comes with confirmation that the Thai economy only grew 1.8% in the second quarter and may be facing a ceiling of 3% growth in 2023.

 

The Governor of the Bank of Thailand Sethaput Suthiwartnarueput is increasingly striking a discordant note when commenting on the policies of the new government including the signature proposal of a ฿10,000 digital giveaway.

 

Full story: Thai Examiner 2023-09-20

 

- Cigna offers a range of visa-compliant plans that meet the minimum requirement of medical treatment, including COVID-19, up to THB 3m. For more information on all expat health insurance plans click here.

 

Get our Daily Newsletter - Click HERE to subscribe

 

by Joseph O' Connor

[Jenkins9039]

Good, now talk about the lack of $ that will flood into Thailand with these new proposed tax changes, which will impact the central banks ability to control the THB 

[RichardColeman]

8 hours ago, webfact said:

the Thai economy only grew 1.8% in the second quarter and may be facing a ceiling of 3% growth in 2023

Think that is an indicator of the Thai tourist figures being up the swanny - either that or they have exhausted to ex-covid demand for an expensive trip here

[Thaindrew]

14 minutes ago, Jenkins9039 said:

Good, now talk about the lack of $ that will flood into Thailand with these new proposed tax changes, which will impact the central banks ability to control the THB 

its already sliding .....

 

[bamnutsak]

I can't imagine those with their hands on the financial tiller are happy that Srettha appointed himself Minster of Finance?

 

 

[Jack Cook]

Wonder how long he will last with his UN/WEF nonsense policies

[Srikcir]

8 hours ago, webfact said:

the central bank does not approve of using digital assets to pay for goods and services

This seems at odds or reversal with past BOT involvement with the issue.

https://www.bot.or.th/en/

Directional Paper

• 7 July 2022 - Banking Group’s Digital Asset Business: Supervisory Approach and Management of Risks to the Financial System

Regulation

• 6 Oct 2022 - Notification of the Bank of Thailand No. FPG. 6/2565 Re: Regulations on commercial banks’ financial business groups undertaking digital asset related businesses and transactions

Press Release

• 25 January 2022 - BOT, SEC, and MOF to jointly set guidelines on the usage of digital assets as a means of payment for goods and services
• 1 December 2021 - Bank of Thailand and Relevant Agencies Discuss Guidelines on Usage of Digital Assets as Payment for Goods and Services
• 8 July 2021 - Caution on Using Digital Assets as Means of Payment for Goods and Services
• 19 March 2021 - Stablecoins Regulation Policy
• 17 March 2021 - Thai Baht Denominated Stablecoins

BOT seemed earlier to have "eyes wide open" about the complexity of using digital assets, now apparently eyes firmly shut. Sethaput seems to roll back BOT to a very conservative time.

[kingstonkid]

1 hour ago, RichardColeman said:

Think that is an indicator of the Thai tourist figures being up the swanny - either that or they have exhausted to ex-covid demand for an expensive trip here

The challenge is that like everything else things change.

 

People are realizing that they have less money to spend so are staying closer to home.  They are looking for things that are more family oriented.(something Thailand is not).  Phuket used to be a family location as well as the nightlife.  Pattaya is geared toward the single male.  Bangkok is geared toward single males or people who come here to buy expensive things cheaply.  The single males are spending their money in select areas and are not buying clothes or gong to movies they are spending the money on Beer and girls.  

 

I said it before and will repeat myself.  Just like Vegas is redefining what they are adding sports teams and attractions for the family as well as the casinos Pattaya and Bangkok need to redefine themselves as well as the country for tourists and strt to look at finding ways to compete with China, Vietnam and the Philipines for businesses.

[hotchilli]

9 hours ago, webfact said:

It comes with confirmation that the Thai economy only grew 1.8% in the second quarter and may be facing a ceiling of 3% growth in 2023.

Far lower than the ridiculous predictions that were bounded about 9 months ago.

[shackleton]

I still can't see this digital wallet payment coming off

It sounds to good to be true ???? 

Most Thai people will be hoping I am proved wrong 

And probably will be ????

 

[Dogmatix]

Good for the governor. He is right.  PT is pursuing ridiculous unsustainable short term policies that will jack up government debt for no purpose.  Constructive long term reform is not on their agenda. 

 

Thaksin will try to get rid of Sethaput just like he sacked Chatumongkol as governor in 2001 over similar policy differences.

[Mavideol]

2 hours ago, bamnutsak said:

I can't imagine those with their hands on the financial tiller are happy that Srettha appointed himself Minster of Finance?

 

 

didn't the previous guy appointed himself as minister of the armies or defense... same same, banana republic leaders do have a tendency to appoint themselves to better "rewarding" posts/positions

[Guffman]

11 hours ago, webfact said:

Sethaput Suthiwartnarueput has emphasised, for instance, that the central bank does not approve of using digital assets to pay for goods and services

It would appear that he's talking out a certain orifice. He's part of the Davos WEF crowd, so it's to be expected

 

https://www.ledgerinsights.com/thailand-digital-baht-cbdc-pilot-underway/

[vivananahuahin]

U turn, this man read the newspapers, not the government, what is happening now in China with Evergrande???

Populism and helicopter money are not for this moment.

[kingstonkid]

23 hours ago, Dogmatix said:

Good for the governor. He is right.  PT is pursuing ridiculous unsustainable short term policies that will jack up government debt for no purpose.  Constructive long term reform is not on their agenda. 

 

Thaksin will try to get rid of Sethaput just like he sacked Chatumongkol as governor in 2001 over similar policy differences.

I think Thaksin is going to have bigger fish to fry and it may start in February.  Once he is out of jail, then the promises that were probably made by the military will cease to exist.  The military and elite know that they screwed up.  They now need time to figure out how to get the Genie back in the bottle and that is going to mean making PT look bad and trying to be a nicer more forgiving group than the MFP.

 

Making the PT look bad is going to be easy history shows that they like to shoot themselves in the foot.  The challenge with making PT look bad is that MFP will be there to give the people a better choice.

 

The MFP will be the hard problem and that is going to take more work if there is a chance.  It is going to mean that ALL levels of government (including him who remains nameless) are going to have to give the people something to make them happy.

[jacko45k]

On 9/20/2023 at 12:16 PM, Jenkins9039 said:

Good, now talk about the lack of $ that will flood into Thailand with these new proposed tax changes, which will impact the central banks ability to control the THB 

Do you expect tourism to suddenly come to a stop.....? It is currently on the rise and predicted to increase. Should contribute a lot of foreign reserves.

[Jenkins9039]

49 minutes ago, jacko45k said:

Do you expect tourism to suddenly come to a stop.....? It is currently on the rise and predicted to increase. Should contribute a lot of foreign reserves.

The new policies will ultimately lead to a reduction in $ velocity at the CB level, which will cap their ability to manipulate (control) the Baht-$ ratio.

 

All trade practically occurs in $, all debt is practically in the EuroDollar market.

 

Without the flow of $ the EuroDollar market demand will create a squeeze on the $ the CB has flowing through it.

 

This will then lead to Thailand de-dollarising in certain industries regionally so as to preserve the $ that do flow through the CB for the EuroDollar debt.

 

The average person believes the $ is the reserve currency, it's not, its the Eurodollar market which is some 300-400 trillion (no one really knows) - ledger based debt/liability system, the $ is just the 'benchmark' like the Gold pegged currencies previously utilised, now its pegged against the $ in paper ledgers and digitalised ledgers... 

 

But its serviced (paid in $).

Have a look at the derivatives right at the bottom of this: https://www.visualcapitalist.com/all-of-the-worlds-money-and-markets-in-one-visualization-2022/

That includes the EuroDollar market.

Edited September 23, 2023 by Jenkins9039