DPM denies PM instructs curb on capital outflow

BANGKOK: -- Deputy Prime Minister Somkid Jatusripitak yesterday denied Prime Minister Thaksin Shinawatra had instructed the economic team to curb the capital outflow, saying no fund has flown out of the country as some media reported.

He said the premier had just called for state agencies concerned to help strengthen the basic structure of the economic system so it could keep up with the dynamic change in capital movement, technology, human resources, and news and information at the globalization era.

The Finance Ministry and the Bank of Thailand, as regulators of the financial system, needed to monitor the capital outflow, he said.

“There is no outflow of capital as reported and the premier has never ordered any agencies to curb the outflow. Such news has made me feel uneasy.”

On the government’s decision to adopt the managed floatation of diesel prices, he said it was the first move to tell Thai people that they should turn to save energy.

It is expected the Energy Ministry would allow diesel prices to be fully driven by market in the next six months.

He said the reduction of the diesel oil excise tax by 1 baht per liter was made to help ease adverse impacts from the price surge in the initial period.

--TNA 2005-06-03

Even by talking about it, must mean that there is a distinct possibility of it happening!

As if they'd tell anyone there was a capital outflow going on anyway. I'm surprised that the latest current account and trade deficit figures were allowed to be published. So much easier to quote the PM: "Mai mii panhaa." .....Nothing to worry about.

"He said the premier had just called for state agencies concerned to help strengthen the basic structure of the economic system so it could keep up with the dynamic change in capital movement"

That means it has already happened.

Must be all them 350K per month BGs sending money overseas to support their poor farang boyfriends.

Restricting capital outflow... manipulating the baht (as below)... the government is going into dangerous waters :

PM defends decision to monitor the baht

Published on Jun 03 , 2005

Prime Minister Thaksin Shinawatra has defended his decision to closely monitor movements in the local currency.

monitoring is not far from manipulating in both the dictionary and in practice

Thaksin had instructed the finance minister Dr. Somkid to supervise the baht and ensure it reflects the real value. I have never given any indications that the state of the Thai economy is worsening.

... but it is...

The policy is not emphasis on strengthening, or weakening of the baht, but that the baht's movement should reflect its real value, Thaksin.

Thaksin, however, admitted that Thailand's trade deficit was mainly due to rising oil prices. Hence, gross domestic product (GDP) growth will be lower than the target and inflation rates will remain high.