Im Worried About Thailand..

[glassdude007]

i hope the economy can handle the politics......

Thailand's Economy Risks Stalling as Political Crisis Escalates

March 6 (Bloomberg) -- Thailand's economic growth may stall as a snap election held amid calls for Prime Minister Thaksin Shinawatra's resignation hurts corporate and consumer confidence.

Thaksin is campaigning to win an April 2 poll announced 10 days ago when he dissolved parliament following weekly mass protests in the capital Bangkok. Opposition parties are boycotting the election.

Since the dissolution of parliament Thailand has postponed signing a free trade accord with Japan and put negotiations on a similar agreement with the U.S. on hold. The government will probably delay a deadline for foreign companies bidding for a slice of 1.7 trillion baht ($43.8 billion) earmarked for public works, which Thaksin has proposed as an economic driver for the next five years.

``A lot of investors are not going to look at anything else apart from politics at the moment for as long as there is nobody who has any credibility running the country,'' said Sanyalaksna Manibhandu, a vice president for institutional research at Kim Eng Securities (Thailand) Pcl, the country's biggest stockbroker. ``If we don't have the leadership in place, things like government spending cannot help the economy.''

Thaksin himself acknowledged the potential economic impact of lingering political uncertainty and demonstrations, just an hour before the country's National Economic & Social Development Board cut its 2006 GDP growth forecast.

`Uncertainty'

``We can't let the country face that uncertainty,'' Thaksin told reporters today in Khon Kaen, about 450 kilometers (280 miles) northeast of Bangkok. ``All this may affect the economy in some way. There is no impact yet, but there will for sure if this situation lasts.''

Thailand's economy expanded at the slowest pace in three quarters in the final three months of 2005 as farm output fell and lower exports hurt manufacturing, prompting the government to cut this year's growth forecast to between 4.5 percent and 5.5 percent, from a range of 4.7 percent to 5.7 percent.

``Concerns about politics will also affect business and consumer confidence in the first half of this year,'' Ampon Kittiampon, general secretary of the NESDB told reporters in Bangkok today. ``If the political crisis turns into widespread violence, it will also affect tourism and the stock market. This would prompt us to review'' our economic growth forecasts for 2006, he said.

`Political Problems'

Thaksin was betting on a five-year infrastructure spending plan and free trade agreements with Japan, the U.S., and other countries to boost the country's exports and economic growth. Southeast Asia's second-biggest economy wants to eliminate most tariffs with its biggest trading partners to boost exports, and had forecast the capital works program to boost economic growth to an average 5.48 percent a year from 2005 to 2009.

``As far as foreign investors are concerned, these political problems are beginning to affect business,'' said Bruce Gale, an independent political risk analyst based in Singapore. ``Now it seems that trade negotiations with the U.S., Japan, Europe, probably India as well, all these things are going to be put in the freezer until Thailand's political troubles are solved one way or another.''

Thailand had planned to sign the agreement with Japan, the nation's second biggest trade partner, on April 3 -- now postponed because of the elections -- and had aimed to complete its trade deal with the U.S., its biggest trading partner, before mid-year.

Election

Thaksin will now have to focus on the election instead, Karun Kittisathaporn, the commerce ministry's permanent secretary, told reporters in Bangkok March 3.

Finance Minister Thanong Bidaya said Feb. 24 -- just hours before Thaksin dissolved parliament -- that Thailand may postpone by a month an April 28 deadline for technical proposals from foreign companies on the so-called mega projects because the time was too short. The government has not officially revised the deadline or indicated further delays since the political crisis deepened last week.

``Given what's going on in politics, economic activity is at a stall,'' said Kitti Nathisuwan, head of equity research at TMB Macquarie Securities (Thailand) Ltd. ``The potential slowdown in growth is quite legitimate. Consumers are just in a wait-and-see mood with what's going on. On the investment side it may take time to push the button.''

Confidence Falls

Thailand's consumer confidence in January fell for the first month in five amid concerns that political attacks may weaken the government and hurt economic growth, a University of the Thai Chamber of Commerce poll showed Feb. 9. The confidence index fell to 82 from 83.6 in December, according to the poll of 2,249 respondents.

``Consumer confidence has been significantly hurt in the past few months with protests and the political crisis,'' Naporn Sunthornchitcharoen, senior executive vice president at Land & Houses Pcl, Thailand's biggest homebuilder, told reporters on March 1. ``It has affected the property industry because people buy new homes mainly based on their confidence of economic growth, not savings. The political uncertainty and crisis will delay the mega-projects which are needed to boost economic growth and employment this year.''

Tens of thousands of Thais attended an anti-Thaksin protest late yesterday, and thousands marched on the premier's Bangkok office to demand his resignation.

Boycott

Thaksin, 56, a former policeman and billionaire businessman turned politician, on Feb. 24 dissolved parliament and called an election for April 2, which is being boycotted by the three main opposition parties over disagreements on constitutional change.

Thailand's leader has faced escalating calls to quit since his family's sale in January of its stake in the communications company Shin Corp. netted a tax-free $1.9 billion. Since winning a record majority in Feb. 2005, Thaksin has been attacked over issues including conflicts of interest, media freedom, ministerial ethics, education reforms, free trade pacts, planned sales of shares in public utilities, and Muslim unrest.

Thaksin in a speech to supporters on Friday night said he would call a second parliamentary election no sooner than next year, in an attempt to gain a legitimate mandate as opponents boycott next month's poll.

To contact the reporters on this story:

Beth Jinks in Bangkok at [email protected];

Laurent Malespine in Bangkok at [email protected]

Last Updated: March 6, 2006 03:00 EST

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[britmaveric]

Look forward to the sterling/dollar rise.

[English Noodles]

Look forward to the sterling/dollar rise.

This is what i have been thinking. The exchange rate for Stirling to Baht is pretty poor at the moment comparing to the past few years. I have funds held in Sterling, some of which i am waiting to transfer to a Thai bank and hold in Baht.

Will there be a signifficant shift in the exchange rates over the next few weeks or even months?

What do you guys think? and why.

[Kerryd]

Look forward to the sterling/dollar rise.

This is what i have been thinking. The exchange rate for Stirling to Baht is pretty poor at the moment comparing to the past few years. I have funds held in Sterling, some of which i am waiting to transfer to a Thai bank and hold in Baht.

Will there be a signifficant shift in the exchange rates over the next few weeks or even months?

What do you guys think? and why.

I check the Cdn $ vs Baht daily, and there has been very little movement (up 10 satang one day, down 9 the next) over the last couple of weeks.

Remember that it's not just what happens in Thailand that affects the exchange rate. Events in your home countries could have an effect that might offset what happens in Thailand.

I remember awhile back when it seemed a lot of currencies were gaining against the baht, but the Canuck Buck actually lost value. This was the result of certain policies the Liberal government was implementing.

As a result, while the baht was weakening, the Cdn $ was dropping even faster

I certainly would like to see a major weakening (of the baht) for a short period, strictly for personal gain of course

I noticed as well, all during the controversy over the Shin sale, the baht didn't seem to be adversely effected (compared to the Loonie).

[English Noodles]

Look forward to the sterling/dollar rise.

This is what i have been thinking. The exchange rate for Stirling to Baht is pretty poor at the moment comparing to the past few years. I have funds held in Sterling, some of which i am waiting to transfer to a Thai bank and hold in Baht.

Will there be a signifficant shift in the exchange rates over the next few weeks or even months?

What do you guys think? and why.

I certainly would like to see a major weakening (of the baht) for a short period, strictly for personal gain of course

I agree, only for a short period of time and only for personal gain No malice intended (will get flamed im sure)

[Rinrada]

Right place at the wrong time...or vise versa.....

Was in the "Korfee chop" at the Honey in @ 1994 when the exchange rate was about 35 bt to the £-Pound......35bt ..jings.. but same place a couple of years later and guess wot......95bt to the £pound..

Imagine nowadays a swing of 60Bt or to take the lower figure ...200% increase on a single £..

Fortunes are made and were LOST depending on your ability to guess the outcome and to suggest that it could happen again.......well...could it........what would Warren Buffet say?

My old friend Ph** (anon)is believe it or not still sunning himself on Patti Beach almost 9 years later from the dosh he made that day ....£5k@99bt /£.....but must be getting low by now.

Recon he is relying on the extra dosh that G.B is bunging him for his winter fuel allowance now that he has/ must have hit the magic.... BIG 80...MPrai...still a boy at heart.

[English Noodles]

Right place at the wrong time...or vise versa.....

Was in the "Korfee chop" at the Honey in @ 1994 when the exchange rate was about 35 bt to the £-Pound......35bt ..jings.. but same place a couple of years later and guess wot......95bt to the £pound..

Imagine nowadays a swing of 60Bt or to take the lower figure ...200% increase on a single £..

Fortunes are made and were LOST depending on your ability to guess the outcome and to suggest that it could happen again.......well...could it........what would Warren Buffet say?

My old friend Ph** (anon)is believe it or not still sunning himself on Patti Beach almost 9 years later from the dosh he made that day ....£5k@99bt /£.....but must be getting low by now.

Recon he is relying on the extra dosh that G.B is bunging him for his winter fuel allowance now that he has/ must have hit the magic.... BIG 80...MPrai...still a boy at heart.

It worked the opposite way for us. At the time of the crisis we had a company loan in US Dollars at the time through a Thai Bank which was a preffered method in those days. The crash happened so our weath almost halfed over night and we owed in reality twice as much as we did the day before. All sorted now but it was not easy and it caused a fair amount of stress, heart ache and general missery for some time.

Never take anything for granted now.

[Meerkat]

It worked the opposite way for us. At the time of the crisis we had a company loan in US Dollars at the time through a Thai Bank which was a preffered method in those days. The crash happened so our weath almost halfed over night and we owed in reality twice as much as we did the day before. All sorted now but it was not easy and it caused a fair amount of stress, heart ache and general missery for some time.

Never take anything for granted now.

Indeed. At least nowadays it is considerably easier (and cheaper) to hedge against such a move.

[cclub75]

Indeed. At least nowadays it is considerably easier (and cheaper) to hedge against such a move.

We should add that it's also a matter of common sense : major currencies (USD, Euro) are much less fragile than the one of a small country like Thailand.

There is a mass effect : in time crisis, vessels Euro and USD would continue to move on for a while. On the contrary small boat like THB, if a crisis, would stop and sink very quickly.

So the solution : wait and see but be sure to share your holdings.

And I should add : open an account with a stock broker here. Soon it could be "hunting season opening"....

[usatrader]

Some say among economic circles that Thaskin's Singapore monies Ching Chinging into the Thai Economy has been the reason that across the board the Thai Bhat has strengthened against most major currencies. Political instability and or his removal may take it the wrong way indeed.

It seems the roulette wheel is a spining. Spining awaiting a numbered outcome of the mob on the streets and Blvd's of ye old Bangkok once again I think. Anyone here for October 14, 1973, October 6, 1976, and May 1992? Will we see 70 bhat to a USD or the old standard of 25? hey!

A straddle strategy with one foot here and one foot there maybe? But when was, is or will the timing be right?

Bhat appreciation over the last 120 days.

Canadian Dollar-33.997 ( No History Do not speculate on C Dollar)

US Dollar -38.76

Hi 1/9/98 54.7 Low -1/2/1980 20.661

Euro -46.5198

Hi 12/27/04-53.1784 Lo - 44.3018

Pound Sterling-67.799

Hi 8/13/04 -76.5849 Lo -64.2397

Japanese Yen -32.9985

(per 100 yen)Hi -8/13/04 35.6292 Lo -38.8965

Edited March 7, 2006 by usatrader