Thai Exporters Urge Baht Weakening for Competitiveness

Photo courtesy of Bangkok Post

Thai business operators, led by the Federation of Thai Industries (FTI), are calling for the Bank of Thailand to address the baht's appreciated value. They suggest that managing the exchange rate to 34-35 baht per US dollar would enhance the nation's competitiveness in exports and tourism. These sectors are crucial, contributing approximately 70% of Thailand’s total revenue.

The baht has appreciated by 8% against the dollar this year but has eased to around a 5% increase. This appreciation contrasts with the Vietnamese dong and Indonesian rupiah, which have both depreciated. Thai exports to the US, a significant market, are impacted by this currency strength, which currently accounts for 18% of total export value compared to Vietnam’s 32%.

FTI Chairman Kriengkrai Thiennukul highlights other factors apart from a weaker dollar, like rising gold prices and possible involvement of money laundering through gold and cryptocurrency trading. These activities might be bolstering the baht. The industrial sector is urging regulatory bodies to scrutinize these transactions and identify underlying causes of the baht’s appreciation.

Gold price correlation with the baht is notably high in Thailand, leading to a surge in gold exports, particularly to Cambodia, now the second-largest market after Switzerland. Thailand’s gold shipments to Cambodia reached 71.3 billion baht in the first seven months of the current year.

Mr. Kriengkrai also mentioned concerns over US tariffs impacting Thai GDP, with predictions of affecting growth by 0.01 to 0.77 percentage points, contingent on government response. Meanwhile, Bank of Thailand Governor Vitai Ratanakorn assured coordination with relevant agencies to align monetary and fiscal policies, aiming for economic stability.

In response to external and internal pressures, the central bank revised GDP growth forecasts for 2025 and 2026 to 2.2% and 1.6%, down from earlier projections of 2.3% and 1.7%.

Key Takeaways

• Thai business calls for a weaker baht to boost exports and tourism.
• Rising gold prices and suspected money laundering may affect the baht.
• Thai GDP growth forecasts are downgraded amid economic concerns.

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  Adapted by ASEAN Now from Bangkok Post 2025-10-22