Continued Baht Rise Costs Some Industries Bt90-100 Billion Already

[webfact]

Continued baht rise costs some industries Bt90-100 billion already

BANGKOK, Oct 15 – The continued strengthening of Thailand's baht currency has incurred some Bt90-100 billion in damages to the country’s industrial sector, according to the Federation of Thai Industries (FTI).

FTI chairman Payungsak Chartsutipol said various measures taken by the government to help small entrepreneurs affected by the rising baht sounded satisfactory because it enabled the entrepreneurs to import machinery to improve their product quality and boost competitiveness in the medium and long terms.

However, he conceded the latest measures issued by the government had been taken with an aim of helping only the baht surge-affected small- and medium-size enterprises (SMEs).

Regarding ongoing efforts to oversee the baht value, he said, it is the duty of the Bank of Thailand to ensure that the currency moves in the same direction with other currencies in the region.

He said the central bank is empowered to intervene in the baht movement through various approaches. One effective way is to use the capital to purchase foreign bonds.

Mr Payungsak said that FTI found various industries had already incurred around Bt90-100 billion is losses from the continued baht appreciation.

Industries affected by the stronger baht most include foods, textiles and garments, and local content-reliant production. (MCOT online news)

-- TNA 2010-10-15

[IMA_FARANG]

So if the Thai exports are relly being hurt by a stronger Baht....my question is this:

So who is benefitting by a stronger Baht? It certainly isn't us, retired Americans who get paid our pension in Dollars. (And don't say we should go to another currency...even if our government would ever do that (which it won't).

If the Thai government was really serious about stopping the rise of the Baht against the Dollar/Pound/Euro they could simply require a 30 day notice peiod for anyone who wished to buy Baht beyond a certain amount. That would limit the availability of Baht for speculation.

So my question again is:

WHO is benifitting from a stronger baht?

Edited October 15, 2010 by IMA_FARANG

[chantorn]

And how much it cost the tax payer? Bank of Thailand is going bankrupt soon, if it does not stop messing around with the exchange rate.

[JetsetBkk]

Can we have another one of these, please?

[laurentbkk]

So if the Thai exports are relly being hurt by a stronger Baht....my question is this:

So who is benefitting by a stronger Baht? It certainly isn't us, retired Americans who get paid our pension in Dollars. (And don't say we should go to another currency...even if our government would ever do that (which it won't).

If the Thai government was really serious about stopping the rise of the Baht against the Dollar/Pound/Euro they could simply require a 30 day notice peiod for anyone who wished to buy Baht beyond a certain amount. That would limit the availability of Baht for speculation.

So my question again is:

WHO is benifitting from a stronger baht?

Usually investor in capital market , as there are no taxes on stock transaction the money coming from abroad consolidate the Thai baht. The government must start to charge taxes on this capital. well that's what I think ... the amount of money coming for investments in Thailand is too much as very attractive if tax free.

All industries facing problems with their export market ..such as mine for instance not to mention tourists who wont find the country as attractive as before.We just jump 13 years back.

[Thaddeus]

It's funny how the number of these negative reports reaches a crescendo as we are coming up to the weekend, can't fix anything on a Saturday or Sunday and by Monday morning the problem is on the back burner.

[sunjunkie56]

So if the Thai exports are relly being hurt by a stronger Baht....my question is this:

So who is benefitting by a stronger Baht? It certainly isn't us, retired Americans who get paid our pension in Dollars. (And don't say we should go to another currency...even if our government would ever do that (which it won't).

If the Thai government was really serious about stopping the rise of the Baht against the Dollar/Pound/Euro they could simply require a 30 day notice peiod for anyone who wished to buy Baht beyond a certain amount. That would limit the availability of Baht for speculation.

So my question again is:

WHO is benifitting from a stronger baht?

The Fat Cats in Bangkok, you only have to look in the Bangkok Post For the Ferraris, Aston Martin, Lambourghini, Etc For sale.

[Jimi007]

Can we have another one of these, please?

"The crisis started in Thailand with the financial collapse of the Thai baht caused by the decision of the Thai government to float the baht, cutting its peg to the USD, after exhaustive efforts to support it in the face of a severe financial over extension that was in part real estate driven."

Hum, real estate driven... Kind of like the over building and large real estate bubble here in Phuket. I'm sure there are some builders here that are hurting. There is also a real estate bubble in China that has yet to burst. Only time will tell...

[cloudhopper]

WHO is benifitting from a stronger baht?

The USA. For now.

[afarang]

And how much it cost the tax payer? Bank of Thailand is going bankrupt soon, if it does not stop messing around with the exchange rate.

Most of us have {wishfully} been predicting the collapse of the Baht for about 3 years- not going too happen , sadly. Everybody on a pension is hurting.And to top it off ,the rapacious Thai banks slapped on an extra B150 surcharge. mongrels

[lovelomsak]

<P>Thailand economy will be what benefits from strong baht. The way I see it is a little different than most people but I would like to add all my life I saw economicas different than most but also all my life I have been right in my calls and disliked for being right. I saw this coming years ago came to Thailand and would try to bring it into conversation with farangs I met here( trying to make friends by showing I could be of benefit as a friend) they kept putting me down and insulting me so I quit trying to help them.Now they are running around like chickens with their heads cut off trying to figure out what happened and how they will survive well I amnot effected in the least. What happened was obvious to me I saw it coming a long time ago and tried to explain it but was treated rudely so quit.<BR> I willnot give you all the reasons Thailands economy will prosper from the strong baht but will give you some insight to work with if some people here show interest. I will expose more otherwise it will be show and tell. Time will tell and it will show.<BR> Here we go. <BR> A strong baht is allowing smaller companies with little capital to grow, putting them in a position for the not to distant future to compete globally for larger portions of the world market.Creating infrastructure.<BR> A strong baht and weakening asian currencies give Thailand more american dollars at a cheaper rate than their neighbours, Thus again giving them even more for their baht in purchasing with the asian nations using the american dollar. They simply get more American dollars have more to spend.<BR> Thats all for today. <BR> Now try and piece together what asian countries Thailand could trade and would trade with that would see benefit in this. After you have done that then look at what Thailand can produce with what they get from these asian countries to then trade with America and Europe and you will be on your way to understanding how having a strong baht works for Thailand.<BR> You donot have to beieve what I write here but please keep it for future reference in case at some time you understand what I am attempting to illustrate. I apologize for not painting the whole picture but as we all know that is impossible. All I can state is the obvious.<BR> This is not a troll but I expect to gets lots of rude comments for what I wrote here sorry. I have no power over what other people do or write.<BR> It is like sailing sometimes you have to go against the current to get into the strong flow going the same way you want to go. That is Thailand at this moment it is paying the price in some areas for what the future has to hold.</P>

<P> Oh and dont speculate on the american dollar dropping below 26 I am fairly certain it will settle around 28.</P>

[Thaddeus]

This is not a troll but I expect to gets lots of rude comments for what I wrote here sorry.

The worst part of your post is it is all in one lump, I only read the last few lines.

[ExpatJ]

Usually investor in capital market , as there are no taxes on stock transaction the money coming from abroad consolidate the Thai baht. The government must start to charge taxes on this capital. well that's what I think ... the amount of money coming for investments in Thailand is too much as very attractive if tax free.

All industries facing problems with their export market ..such as mine for instance not to mention tourists who wont find the country as attractive as before.We just jump 13 years back.

Actually there is a 10% tax on stock transaction profits.

As to who benefits- those foreign investors who shifted alot of US dollars to Baht last year/early this year have seen their thai baht investments increase alot in dollar terms (11 % increase since january alone).

I moved half of my US dollar savings to thai baht in january (into the Thai stock exchange) so the weak dollar has made that move very profitable. On the other hand im paid in US dollars.......

[lovelomsak]

This is not a troll but I expect to gets lots of rude comments for what I wrote here sorry.

The worst part of your post is it is all in one lump, I only read the last few lines.

Yes that is strange i wrote it in separate paragraghs donot know hy it posted like that

[moobie]

In answer to IMA_FARANG : WHO is benefiting from a stronger baht?

Thais buying abroad. Two recent purchases spring to mind here in the UK : Corus Steel Plant, Teeside and the John West Fish canning division.

[britmaveric]

Thai Economy......

[cloudhopper]

^^It's the economies that are based on paper pushing, consumption and unpayable debt that'll be flushed first.

Here's a good review of the currency wars -

http://www.alternet.org/module/printversion/148481

[Pib]

Fact: most emerging market Asian economies have strong growth and are not overly debt ridden; many western economies have weak growth and are overly debt ridden. Investment capital flows from weak to strong economies. Result: baht appreciating while many western currencies are depreciating. Ouch.

[Time Traveller]

So if the Thai exports are relly being hurt by a stronger Baht....my question is this:

So who is benefitting by a stronger Baht? I

There are 3 groups that benefit. First are the Thai consumers ! Everything that is priced in dollars becomes cheaper. Eg. Fuel, machinery, imported items, food, overseas holidays etc. The 2nd group of people that benefit are people that own Thai assets such as shares and real estate as incoming money inflates the value of their holdings. The 3rd people that benefit are people with debts in US dollars. Since the baht is stronger the total amount they must pay back becomes less in Thai baht terms.

Note that while it might affect many American visitors such as yourself, the buying power of people from East Asian & Australia has maintained as those currencies have hardly moved against the baht. That are all stronger against the dollar. So while tourism may be affected with lower spending/arrivals from western countries, there is likely to be some offset with higher spending from places like China & India.

[Chunky1]

Don't break your arm patting yourself on the back.

You should go to China and explain to them why they should let their currency appreciate. Everyone in the world disagrees with you.

Also, what are these "correct calls" that you made? That the USD would lose value? Yeah, I don't think that makes you a genius hombre.

<P>Thailand economy will be what benefits from strong baht. The way I see it is a little different than most people but I would like to add all my life I saw economicas different than most but also all my life I have been right in my calls and disliked for being right. I saw this coming years ago came to Thailand and would try to bring it into conversation with farangs I met here( trying to make friends by showing I could be of benefit as a friend) they kept putting me down and insulting me so I quit trying to help them.Now they are running around like chickens with their heads cut off trying to figure out what happened and how they will survive well I amnot effected in the least. What happened was obvious to me I saw it coming a long time ago and tried to explain it but was treated rudely so quit.<BR> I willnot give you all the reasons Thailands economy will prosper from the strong baht but will give you some insight to work with if some people here show interest. I will expose more otherwise it will be show and tell. Time will tell and it will show.<BR> Here we go. <BR> A strong baht is allowing smaller companies with little capital to grow, putting them in a position for the not to distant future to compete globally for larger portions of the world market.Creating infrastructure.<BR> A strong baht and weakening asian currencies give Thailand more american dollars at a cheaper rate than their neighbours, Thus again giving them even more for their baht in purchasing with the asian nations using the american dollar. They simply get more American dollars have more to spend.<BR> Thats all for today. <BR> Now try and piece together what asian countries Thailand could trade and would trade with that would see benefit in this. After you have done that then look at what Thailand can produce with what they get from these asian countries to then trade with America and Europe and you will be on your way to understanding how having a strong baht works for Thailand.<BR> You donot have to beieve what I write here but please keep it for future reference in case at some time you understand what I am attempting to illustrate. I apologize for not painting the whole picture but as we all know that is impossible. All I can state is the obvious.<BR> This is not a troll but I expect to gets lots of rude comments for what I wrote here sorry. I have no power over what other people do or write.<BR> It is like sailing sometimes you have to go against the current to get into the strong flow going the same way you want to go. That is Thailand at this moment it is paying the price in some areas for what the future has to hold.</P>

<P> Oh and dont speculate on the american dollar dropping below 26 I am fairly certain it will settle around 28.</P>

[Chunky1]

So if the Thai exports are relly being hurt by a stronger Baht....my question is this:

So who is benefitting by a stronger Baht? I

There are 3 groups that benefit. First are the Thai consumers ! Everything that is priced in dollars becomes cheaper. Eg. Fuel, machinery, imported items, food, overseas holidays etc. The 2nd group of people that benefit are people that own Thai assets such as shares and real estate as incoming money inflates the value of their holdings. The 3rd people that benefit are people with debts in US dollars. Since the baht is stronger the total amount they must pay back becomes less in Thai baht terms.

the flip side is the potential for asset bubbles to form.

the TG really does not want a strong baht.

currency exchange is quite flawed. i don't think there is an easy fix. there will be more frequent global boom/bust then we have seen previously.