Thai Baht Will Further Rise Despite Measures: Korn

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CURRENCY

Baht will further rise despite measures: Korn

By NALIN VIBOONCHART

THE NATION

Local companies are allowed to invest an unlimited amount in overseas subsidiaries as part of five measures approved by the Finance Ministry to spur capital outflows.

Finance Minister Korn Chatikavanij said yesterday on the sideline of Ramkhamhaeng University's seminar on "Thailand's advancement in the global stage" that the five measures are adding flexibility on investment and loans. Given cheaper assets overseas, this marks a good opportunity for Thai investment. To be announced as the ministry's regulations, Thai companies can invest upto US$50 million in an unaffiliated overseas company. While exporters can keep upto $50,000 in overseas bank accounts, foreign deposit account limit is lifted to $500,000.

"These are just temporary measures. The baht will strengthen on weak dollar policy. All need to adjust their policies," he said.

Charoen Pokphand Group Chairman Dhanin Chearvanont noted that in dealing with the baht appreciation, the government should conduct a study on who are benefiting and who are losing. Then, government help should be focused on the disadvantaged. He opposed a blanket policy which could wipe out some potential benefits.

Thai companies should also take this opportunity to import new technology which will help reduce costs in the future. The government should also throw investment in infrastructure particularly the logistics and irrigation, which will boost the economy in the long term. For the economic growth, small and medium-sized enterprises should also be allowed to access more to bank loans, through a different set of lending conditions from that offered to large-sized companies.

Korn highlighted that the government's policy from now will focus on increasing the purchasing power of the low-income earners and accessibility to natural resources, as the private sector is strong as reflected through the great contribution to the first-half economic growth.

In the past 10 years, economic wealth increased by 200 per cent of they witnessed a negative growth rate in income.

-- The Nation 2010-09-23

[Boater]

Are they trying to make thailand so expensive no one will come here ? Why don't they follow japan and try to de value the baht !

[SomTumTiger]

Speaking for those who live, work, and earn Thai baht -

[SamritT]

Baht up or down, 50% of the people will loose, and 50% will gain. Why not let the view of those who gain be made public? . . . Dhanin Chearavanont, chairman and CEO of the Charoen Pokphand (CP) Group, said "the government should not intervene in the baht to make it weaker. This would benefit only some groups."

[jucel]

Speaking for those who live, work, and earn Thai baht -

why have u had a pay rise??? unless you import or travel or change your currency you will not feel any effect. ie if you earn 50k baht every month, its still worth the same in thailand. no more no less. If a thai person earns 10k and spends it all in Thailand they are no better off.

[jucel]

Baht up or down, 50% of the people will loose, and 50% will gain. Why not let the view of those who gain be made public? . . . Dhanin Chearavanont, chairman and CEO of the Charoen Pokphand (CP) Group, said "the government should not intervene in the baht to make it weaker. This would benefit only some groups."

i beg to differ!! in a country where 70% of gdp is exports i think u will find your percentages are incorrect!

[pete09]

the Baht getting stronger is great for me. I would help me able to afford going to study in U.S. My saving is now worth more in USD so no complaint here. i would be even better if it gets to 25-27 Baht/Dollar

[BlackJack]

Baht up or down, 50% of the people will loose, and 50% will gain. Why not let the view of those who gain be made public? . . . Dhanin Chearavanont, chairman and CEO of the Charoen Pokphand (CP) Group, said "the government should not intervene in the baht to make it weaker. This would benefit only some groups."

i beg to differ!! in a country where 70% of gdp is exports i think u will find your percentages are incorrect!

higher baht

over 60% of oil gas is imported so better

but as prices higher they will pass it on to manufacturers

manufacturers will pass to consumers

WELCOME to inflation

[snowgard]

Never 50% win, 50% loose. Use your head and think about it!!! If the Baht is more stronger the Tourists go otherwhere to a cheaper place. The export of Thailand go down because the Import-Countries buy the product in a cheaper country. And last but not least the "normal" Thaipeople never become a higher income but everything start be much more expensive. Thai thinking!!! If my income go down I must sell my products more expensive!!!

A lot of food are now 15-20% more expensive than 2-3 years ago. But the people still earn only 8.000 - 15.000 Baht.

The only who win about a higher Baht are the companys who import products. But they don't give the "cheaper" import prices to the customer, so the products are not cheaper. They have a higher income in their bankaccount.

Edited September 23, 2010 by snowgard

[fxe1200]

Baht up or down, 50% of the people will loose, and 50% will gain. Why not let the view of those who gain be made public? . . . Dhanin Chearavanont, chairman and CEO of the Charoen Pokphand (CP) Group, said "the government should not intervene in the baht to make it weaker. This would benefit only some groups."

i beg to differ!! in a country where 70% of gdp is exports i think u will find your percentages are incorrect!

Rich Investors in THB will make the bucks, the poor people will lose bigtime, as they rely on export. Tourism businesses also runned by middle class and poorer folks will lose, as Thailand is getting too expensive for travellers, compared to neighbouring countries.

[SamritT]

the Baht getting stronger is great for me. I would help me able to afford going to study in U.S. My saving is now worth more in USD so no complaint here.  i would be even better if it gets to 25-27 Baht/Dollar

See, someone actually gain.

[kuffki]

Unless Thailand is an undercover powerhouse like China or India, which they not.

Baht will get stronger and stronger and stronger and then just crash, little like the last crisis in 1997, from memory it was $1=23-34baht.

Despite what many believe i am firm believer that BOT and the gov manipulate THB and should it be allowed to trade freely on the market i have a feeling things would look very different.

Keep in mind that during those times the top 10% of Thailand benefits while the rest 90% suffers.in other words, rich are getting richer, while poor stay the same or poorer.:jap:

[Hollywood3000]

I'm hoping the Baht goes to 38 Baht to the US dollar. I will stay more than the usual 4 months and maybe even marry a bar girl whom I have only known 5 days.

[laurentbkk]

When Thailand manufacturers wont be competitive anymore on the international market , then maybe it will be time to act , as an exporter I already can see how difficult it is to maintain prices , somehow we have to increase our prices , not to win more money, but to balance with the lost we face everyday because of weak USD and too strong Thai Baht. Yes its good for some who invest abroad , buy properties abroad or go study abroad for sure but what is the % of the people who can do that ? Not much for sure. Not to mention tourists who will not find the country as attractive as before ,for the good prices of hotel, food etc .... You will see a tremendous increase in prices for Hotels in the next 2 months because of the "high" season.

[asiawatcher]

the Baht getting stronger is great for me. I would help me able to afford going to study in U.S. My saving is now worth more in USD so no complaint here. i would be even better if it gets to 25-27 Baht/Dollar

See, someone actually gain.

Khun Samrit there will be equal amounts of wins and losses by numbers but the losses in dollar terms will far outweigh the wins. Our business relies on international visitors who spend a lot of money here. When the Baht strengthened from 37 to 35 that meant for every million USD it cost my clients and extra USD50,000. When it further strengthened to where it is now it has cost them so much they have pulled out of contracts I had for Thailand. I have had more than USD5M in contracts cancelled as we became the same cost as Mexico/Spain and no travel involved.

From my point of view I am still paid the same amount in Baht I contracted to, so no loss to me financially, other than to find more contracts, which is now harder. But the real loss is to the Thai's. They don't have jobs as my contractors and as low income earners, many close to subsidence, it means they are put under huge financial stress. Many have had to seek alternate forms of work and I feel for them. My rates of ay are four times national average and they want to work for me but if I don't have contracts, they don't have work!

Wealthy pundits in Thailand or those earning upwards of Baht 30k a month, will benefit only if spending overseas. There are no low end income earners able to invest offshore either in education or assets. If the Baht were allowed to trade freely without Govt interference it is anyones guess where it would go but I would think it would be better for Thailand overall if the Bank of Thailand and the Govt allowed it to trade.

[blake911]

Speaking for those who live, work, and earn Thai baht -

why have u had a pay rise??? unless you import or travel or change your currency you will not feel any effect. ie if you earn 50k baht every month, its still worth the same in thailand. no more no less. If a thai person earns 10k and spends it all in Thailand they are no better off.

I'm fortunate to work in Thailand and send about half my income back to the UK so I'm in the minority who benefit from a strong Baht. But I certainly sympathise with all those who suffer and think $1 to 33 Baht or GBP1 to 50 Baht is a fair and realistic rate. Of course if the Baht continues to strengthen then maybe my company will suffer and i will lose my job!

[hardy1943]

Are they trying to make thailand so expensive no one will come here ? Why don't they follow japan and try to de value the baht !

Anyone should have figured out by now that the Baht is directly tide to the yen. A strong Yen= strong Baht but it is killing Japan exports.

Here it always takes awhile for them to wake up and smell the coffee and usually until it is to late.

Edited September 23, 2010 by hardy1943

[hardy1943]

the Baht getting stronger is great for me. I would help me able to afford going to study in U.S. My saving is now worth more in USD so no complaint here. i would be even better if it gets to 25-27 Baht/Dollar

See, someone actually gain.

Khun Samrit there will be equal amounts of wins and losses by numbers but the losses in dollar terms will far outweigh the wins. Our business relies on international visitors who spend a lot of money here. When the Baht strengthened from 37 to 35 that meant for every million USD it cost my clients and extra USD50,000. When it further strengthened to where it is now it has cost them so much they have pulled out of contracts I had for Thailand. I have had more than USD5M in contracts cancelled as we became the same cost as Mexico/Spain and no travel involved.

From my point of view I am still paid the same amount in Baht I contracted to, so no loss to me financially, other than to find more contracts, which is now harder. But the real loss is to the Thai's. They don't have jobs as my contractors and as low income earners, many close to subsidence, it means they are put under huge financial stress. Many have had to seek alternate forms of work and I feel for them. My rates of ay are four times national average and they want to work for me but if I don't have contracts, they don't have work!

Wealthy pundits in Thailand or those earning upwards of Baht 30k a month, will benefit only if spending overseas. There are no low end income earners able to invest offshore either in education or assets. If the Baht were allowed to trade freely without Govt interference it is anyones guess where it would go but I would think it would be better for Thailand overall if the Bank of Thailand and the Govt allowed it to trade.

Very well said. I am married to a Thai so we all know the law that my wife owns every thing. Well the property and the House - villa - mansion what you want call it I could not afford to pay the taxes on in the US. For me even at 1US$ = 30 Baht is a very cheap way to live here. I liked it better at 40 -42 but that was when the yen was very weak also. I have everything paid for so for 40,000 Baht a month

I am fortunate not even to spent 1/3 of my retirement income and live better then I could in the US. I am from the Pacific Northwest.

Maybe I am a lucky one

[jacobus]

What no one has mentioned so far is the elephant in the middle of the room. It's not that the Thai Baht is so strong. It's just another fiat currency like almost all currencies since 1971 when the final connection between the USD and gold and silver was severed. Since then the scams and schemes of the international bankers of London, New York, Switzerland, etc. have multiplied and expanded to the point where now the fiat currencies of all countries are being devalued at an increasingly accelerated rate.

It is like a race to the bottom. It's difficult to keep up with which currencies are actually devaluing faster than the others. Certainly the USD is near the top of the list of the fastest devaluing currencies. In recent years Thailand has tried to devalue their currency at the same pace as the USD in order to support exports and tourism. Now they are understandably starting to rethink that strategy. Perhaps they are following the lead of China which recently allowed it's currency to rise against the USD a little bit.

The global picture is bleak. There are no obvious healthy choices within the mainstream spectrum of "conventional wisdom" -- mostly Keynesian thinking. The only option which would eventually put the world on solid economic footing again would be a global return to sound money. It would be painful initially, but in the long run there would be the potential for economic fairness and an end to runaway government spending and always the richest 1% dominating the economies of the world.

[djayz]

What goes up must come down again. I'm sure the Baht - Euro / - GBP / - USD etc. will return (more or less) to its' former value. It's just a question of time (or another crisis).

[hardy1943]

What no one has mentioned so far is the elephant in the middle of the room. It's not that the Thai Baht is so strong. It's just another fiat currency like almost all currencies since 1971 when the final connection between the USD and gold and silver was severed. Since then the scams and schemes of the international bankers of London, New York, Switzerland, etc. have multiplied and expanded to the point where now the fiat currencies of all countries are being devalued at an increasingly accelerated rate.

It is like a race to the bottom. It's difficult to keep up with which currencies are actually devaluing faster than the others. Certainly the USD is near the top of the list of the fastest devaluing currencies. In recent years Thailand has tried to devalue their currency at the same pace as the USD in order to support exports and tourism. Now they are understandably starting to rethink that strategy. Perhaps they are following the lead of China which recently allowed it's currency to rise against the USD a little bit.

The global picture is bleak. There are no obvious healthy choices within the mainstream spectrum of "conventional wisdom" -- mostly Keynesian thinking. The only option which would eventually put the world on solid economic footing again would be a global return to sound money. It would be painful initially, but in the long run there would be the potential for economic fairness and an end to runaway government spending and always the richest 1% dominating the economies of the world.

The last 10 Economist that won a Nobel price will sharply disagree with you. Maybe you should try to proof your point after all they still pay 1 million US$ if you win.

[RHCP]

Never 50% win, 50% loose. Use your head and think about it!!! If the Baht is more stronger the Tourists go otherwhere to a cheaper place. The export of Thailand go down because the Import-Countries buy the product in a cheaper country. And last but not least the "normal" Thaipeople never become a higher income but everything start be much more expensive. Thai thinking!!! If my income go down I must sell my products more expensive!!!

A lot of food are now 15-20% more expensive than 2-3 years ago. But the people still earn only 8.000 - 15.000 Baht.

The only who win about a higher Baht are the companys who import products. But they don't give the "cheaper" import prices to the customer, so the products are not cheaper. They have a higher income in their bankaccount.

Your point that imported products should be cheaper is a fair point and it hasn’t gone unnoticed with me that Thai consumer product importers and retailers are failing to pass on the savings as a result of a favorable exchange rate. But since the Thai government is not concerned about controlling the prices of imported consumer products, retailers here can charge whatever they like and add to their already healthy profit levels.

[julemanden]

Are they trying to make thailand so expensive no one will come here ? Why don't they follow japan and try to de value the baht !

Greeeeeeeeeeeeeeeeeed !

[hardy1943]

Are they trying to make thailand so expensive no one will come here ? Why don't they follow japan and try to de value the baht !

Greeeeeeeeeeeeeeeeeed !

for all of you that like track currencies however this is only for major currencies crosses is http://quote2.fxtrek.com/Misc/promochart.asp?af=wizard2

You con go per minute or go back 10 years

Edited September 23, 2010 by hardy1943

[jacobus]

What no one has mentioned so far is the elephant in the middle of the room. It's not that the Thai Baht is so strong. It's just another fiat currency like almost all currencies since 1971 when the final connection between the USD and gold and silver was severed. Since then the scams and schemes of the international bankers of London, New York, Switzerland, etc. have multiplied and expanded to the point where now the fiat currencies of all countries are being devalued at an increasingly accelerated rate.

It is like a race to the bottom. It's difficult to keep up with which currencies are actually devaluing faster than the others. Certainly the USD is near the top of the list of the fastest devaluing currencies. In recent years Thailand has tried to devalue their currency at the same pace as the USD in order to support exports and tourism. Now they are understandably starting to rethink that strategy. Perhaps they are following the lead of China which recently allowed it's currency to rise against the USD a little bit.

The global picture is bleak. There are no obvious healthy choices within the mainstream spectrum of "conventional wisdom" -- mostly Keynesian thinking. The only option which would eventually put the world on solid economic footing again would be a global return to sound money. It would be painful initially, but in the long run there would be the potential for economic fairness and an end to runaway government spending and always the richest 1% dominating the economies of the world.

The last 10 Economist that won a Nobel price will sharply disagree with you. Maybe you should try to proof your point after all they still pay 1 million US$ if you win.

Yes, well in order to even be considered for a Nobel prize for Economics, one must have his head ensconced where "the sun don't shine". Krugman is the classic case in point. He still asserts that the US gov't can borrow and spend its way out of this mess. Long ago the Nobel prize lost all credibility. They even gave the emperor, Barry Soetoro (Obama), the Nobel peace prize at the same time that he was escalating military activities in Afghanistan and Pakistan.

The Nobel prize is a joke.

[SamritT]

The problem is easy to solve. Convert all Thai Baht to US Dollar, then abolish the Thai Baht. There will be no currency fluctuation ever ever again. http://answers.yahoo.com/question/index?qid=20080422010551AAuJHoh

Edited September 23, 2010 by SamritT

[hardy1943]

What no one has mentioned so far is the elephant in the middle of the room. It's not that the Thai Baht is so strong. It's just another fiat currency like almost all currencies since 1971 when the final connection between the USD and gold and silver was severed. Since then the scams and schemes of the international bankers of London, New York, Switzerland, etc. have multiplied and expanded to the point where now the fiat currencies of all countries are being devalued at an increasingly accelerated rate.

It is like a race to the bottom. It's difficult to keep up with which currencies are actually devaluing faster than the others. Certainly the USD is near the top of the list of the fastest devaluing currencies. In recent years Thailand has tried to devalue their currency at the same pace as the USD in order to support exports and tourism. Now they are understandably starting to rethink that strategy. Perhaps they are following the lead of China which recently allowed it's currency to rise against the USD a little bit.

The global picture is bleak. There are no obvious healthy choices within the mainstream spectrum of "conventional wisdom" -- mostly Keynesian thinking. The only option which would eventually put the world on solid economic footing again would be a global return to sound money. It would be painful initially, but in the long run there would be the potential for economic fairness and an end to runaway government spending and always the richest 1% dominating the economies of the world.

The last 10 Economist that won a Nobel price will sharply disagree with you. Maybe you should try to proof your point after all they still pay 1 million US$ if you win.

Yes, well in order to even be considered for a Nobel prize for Economics, one must have his head ensconced where "the sun don't shine". Krugman is the classic case in point. He still asserts that the US gov't can borrow and spend its way out of this mess. Long ago the Nobel prize lost all credibility. They even gave the emperor, Barry Soetoro (Obama), the Nobel peace prize at the same time that he was escalating military activities in Afghanistan and Pakistan.

The Nobel prize is a joke.

Whatever. Your wisdom is greater than theirs

[Renbe]

Gold is genuine Wealth, Gold is real money.

“Paper money eventually returns to its intrinsic value – ZERO”

Voltaire 1729

[Renbe]

The problem is easy to solve. Convert all Thai Baht to US Dollar, then abolish the Thai Baht. There will be no currency fluctuation ever ever again. http://answers.yahoo...22010551AAuJHoh

Except perhaps the fluctuations between the US $ and the Euro, the Renminbi, the Ruble, the Yen, the UK Pound Sterling, the Swiss Franc and the Swedish Kronor,

just to name a few....

[sillyman99]

What goes up must come down again. I'm sure the Baht - Euro / - GBP / - USD etc. will return (more or less) to its' former value. It's just a question of time (or another crisis).

Do you mean the 25 Baht to the Dollar and 38 Baht to the GBP that it was in the early 90's ?