Yingluck Orders 7-Point Assignment For Finance Minister To Tackle Baht Surge

[webfact]

Thai PM proposes measures to fight surging baht
By English News



BANGKOK, May 14 – Prime Minister Yingluck Shinawatra today outlined an urgent seven-point measure to rein in the surging baht and tackle Thailand’s labour shortage.

According to a government spokesman, Deputy Prime Minister/Finance Minister Kittiratt Na-Ranong was instructed to carry out the proposed measures, including a push for the baht as a regional trading currency, expanding vocational education to solve the labour crisis, promoting the use of domestic raw materials for local industries, especially in auto production, and exemptions of value added tax (VAT) for export industries and permission for exporters to pay in foreign currencies without having to change into baht.

The finance minister was instructed to find loan sources for local manufacturers and reduce tariff on the import of jewellery to be exhibited in Thailand.

The prime minister also asked that the Bank of Thailand (BoT) provide currency comparisons between the baht and other currencies without exclusively pegging itself to the US dollar.

Mr Kittiratt reportedly informed today’s cabinet meeting of the recent Finance Ministry meetings with the private sector, exporters, the Monetary Policy Committee, the Federation of Thai Industries (FTI) and the Thai Chamber of Commerce (TCC) to discuss the impact of the appreciating baht.

The prime minister instructed the Finance Ministry to hold similar sessions with the labour, education, industry and commerce ministries to find joint solutions to the challenges.

Mr Kittiratt said cabinet members were confident that the BoT will be able to stabilise the baht, adding that the private sector wants to see the baht movement stabilise at Bt29-30 against the dollar.

In the short term, manufacturers of electrical appliances, refrigerators and air-conditioners have asked for lower VAT while the tourism and hotel industries are also calling for tax reductions to give them a competitive edge in the region.

They mostly called on the government to urgently solve the problem of labour shortage. (MCOT online news)


-- TNA 2013-05-14

Latest Baht exchange rates: baht.thaivisa.com

PM orders 7-point assignment for Finance Minister to tackle baht surge; invites key ministers to meet on measures to tackle economic problems /MCOT

[Tatsujin]

Now it's urgent? I thought only last week the Finance Minister said it wasn't a problem, or have they finally got their heads out of their collective arse's and realized that it is indeed a problem at last?

[cedel]

BoT has just to cut the interest rate so that the baht would't be so attractive to buy for foreign investors...less demand-> baht will fall..so easy !

[bluweyze]

Now with a combination of the high Baht and raised minimum wage Thailand has become noncompetitive in many industries. Some companies have already closed and moved elsewhere. It was all very forcastable but there is non so blind as those that refuse to see

[reflectionx]

With everyone else cutting interest rates and printing money, the only way to contain the surge is to do the same. You may come up with 7 000 point assignment, but good luck ...

[cabanlit]

Scrap exchange controls for all.

[allan michaud]

"and reduce tariff on the import of jewellery to be exhibited in Thailand."

What possible relevance does this have to the Baht or employment in Thailand?????

[ataloss]

One would think these measures would be at their fingertips without having to conduct another poll / study.

[Noistar]

and there was me thinking the person with the title of PM wouldn't even know how to turn on a calculator, let alone 'order' changes to financial policy.

every day I live and learn

[hellodolly]

"and reduce tariff on the import of jewellery to be exhibited in Thailand."

What possible relevance does this have to the Baht or employment in Thailand?????

She is thinking of buying some jewelery.

[Neilly]

"and reduce tariff on the import of jewellery to be exhibited in Thailand."

What possible relevance does this have to the Baht or employment in Thailand?????

She is thinking of buying some jewelery.

Nah she does all that on her jollies abroad...plus I'm sure her dear brother sends her lots of trinkets from Dubai where it's plentiful

[CaitlinHappyMeal]

She has other people to count for her. And tell her what to do. If she was blonde . . . you know the rest.

thats is insulting to all us blondes!!

[thaicbr]

"and reduce tariff on the import of jewellery to be exhibited in Thailand."

 

What possible relevance does this have to the Baht or employment in Thailand?????

When you are a woman with spare cash burning a hole in your pocket.... lots:D

Sent from my i-mobile i-STYLE Q6

[TallGuyJohninBKK]

A lot of BS....

--baht as a regional trading currency,

Not likely.

--expanding vocational education to solve the labour crisis,

Not anytime soon, especially at the pace this govt. moves

--promoting the use of domestic raw materials for local industries, especially in auto production,

Possible, but not likely to make any meaningful difference any time soon

--exemptions of value added tax (VAT) for export industries

They could, and it might help the exporters financially, but won't do anything about the exchange rate.

--permission for exporters to pay in foreign currencies without having to change into baht.

Same answer as the prior issue.

[petedk]

while the tourism and hotel industries are also calling for tax reductions to give them a competitive edge in the region.

Which part of the tourism industry is that? Mafia taxi drivers? Jet ski operators? Street vendors charging 120 baht for a plate of fried rice?

Or is the five star hotels charging Western prices for their services?

[12DrinkMore]

They mostly called on the government to urgently solve the problem of labour shortage

I must be stupid.

So with a background of increasing tourist arrivals, a GDP moving upwards at a rate all western countries would be very happy to have and a shortage of labour, what, precisely, is the problem?

The BoT "manages" the THB against a basket of currencies, not just the USD. And can Yingluck not check out the FX rates at any Thai bank website including the Bank of Thailand?

http://www.bot.or.th/English/Statistics/FinancialMarkets/ExchangeRate/_layouts/Application/ExchangeRate/ExchangeRate.aspx

With historic rates here

http://www2.bot.or.th/statistics/ReportPage.aspx?reportID=123&language=eng

If Thailand wants to get the economy really chugging along, the super-rich have to

1. Let some of their wealth trickle down to the employees working long hours for 6,000 Baht/month.

2. Allow the education system to improve.

But, of course, that is exactly NOT what they want as maids, chauffeurs, countless salesgirls, massage girls and such service jobs will disappear or become far more expensive as better paying jobs will be available elsewhere.

[Jean Pierre Jacquot]

As intelligent as everything TRT is doing, I am impressed!

[raviishoo]

1 - a push for the baht as a regional trading currency - >>> long term solution - does not address immediate alleviation of baht strength - does not help exporters and manufacturers. Thailand does not have the polital will nor the financial strength nor the intelligent wherewithall to make this happen. Hence, this "solution" is empty of any substance.

2 - expanding vocational education to solve the labour crisis >>>> fewer people able to do more things??? The problem is not labor force not having vocational knowledge, the problem is not enough labor!! What is the point of teaching the available 100 people more skills when the need is for 500 people in the labor force. This so called 'solution' is a non event!

3 - promoting the use of domestic raw materials for local industries, especially in auto production, >>>> how is this going to help the strong baht? In fact cheaper imports help keep inflation in check. promoting domestic raw material is not going to help weaken the currency. A no brainer!

4 - exemptions of value added tax (VAT) for export industries and >>>> has anyone tried to get a VAT refund??? No SME is able to get a VAT refund in an honest way - so much so that 1000s of SMEs simply have given up asking for the VAT refunds which in turn has made them close shop as they are non competitive. Ceaser does not care what happens to rome's citizens - all he cares about is getting is share! Open your eyes m'lady!

5 - permission for exporters to pay in foreign currencies without having to change into baht.>>>> this is a sensible proposal and all limits should indeed be removed. Should have been done a long time ago.

6 - find loan sources for local manufacturers >>> yeah right! make them go further and further into debt. how does access to more debt help weaken the baht? and how does this help in the immediacy?? scratching my head at this imprudence.

7 - reduce tariff on the import of jewellery to be exhibited in Thailand. >>>> again how does this help weaken the baht? it is another one of those populist proposals that will only excacerbate the current account situation and the debt/gdp ratio of the country.

8 - provide currency comparisons between the baht and other currencies without exclusively pegging itself to the US dollar.>>>> are they really pegging to the dollar again? I thought the peg was removed a decade ago! T I T (this is Thailand) I guess!

[Baerboxer]

Now it's urgent? I thought only last week the Finance Minister said it wasn't a problem, or have they finally got their heads out of their collective arse's and realized that it is indeed a problem at last?

It's easy to tell when he tells a little white lie - his lips move. Last week was just to keep everyone calm whilst this very good government honed the finer points of their fantastic plan which is now ready to be revealed.

Another example of banal thinking from the clueless.

[firestar]

They mostly called on the government to urgently solve the problem of labour shortage

I must be stupid.

So with a background of increasing tourist arrivals, a GDP moving upwards at a rate all western countries would be very happy to have and a shortage of labour, what, precisely, is the problem?

The BoT "manages" the THB against a basket of currencies, not just the USD. And can Yingluck not check out the FX rates at any Thai bank website including the Bank of Thailand?

http://www.bot.or.th/English/Statistics/FinancialMarkets/ExchangeRate/_layouts/Application/ExchangeRate/ExchangeRate.aspx

With historic rates here

http://www2.bot.or.th/statistics/ReportPage.aspx?reportID=123&language=eng

If Thailand wants to get the economy really chugging along, the super-rich have to

1. Let some of their wealth trickle down to the employees working long hours for 6,000 Baht/month.

2. Allow the education system to improve.

But, of course, that is exactly NOT what they want as maids, chauffeurs, countless salesgirls, massage girls and such service jobs will disappear or become far more expensive as better paying jobs will be available elsewhere.

Good post.

But the TV crazies will tell you tourist arrivals are not increasing, it's all a ploy, fake tourists planted at Suvarnabhumi to con us farangs and GDP isn't moving upwards, industries are moving out of Thailand in their droves (never mind that the surging baht is itself proof they aren't).

Having said that with most Western countries printing money like there is no tomorrow it'll be very difficult to reign in the baht. Permission for exporters to pay in foreign currencies without having to change into baht is the only measure proposed here that could have any sort of impact.

[12DrinkMore]

They mostly called on the government to urgently solve the problem of labour shortage

I must be stupid.

So with a background of increasing tourist arrivals, a GDP moving upwards at a rate all western countries would be very happy to have and a shortage of labour, what, precisely, is the problem?

The BoT "manages" the THB against a basket of currencies, not just the USD. And can Yingluck not check out the FX rates at any Thai bank website including the Bank of Thailand?

http://www.bot.or.th/English/Statistics/FinancialMarkets/ExchangeRate/_layouts/Application/ExchangeRate/ExchangeRate.aspx

With historic rates here

http://www2.bot.or.th/statistics/ReportPage.aspx?reportID=123&language=eng

If Thailand wants to get the economy really chugging along, the super-rich have to

1. Let some of their wealth trickle down to the employees working long hours for 6,000 Baht/month.

2. Allow the education system to improve.

But, of course, that is exactly NOT what they want as maids, chauffeurs, countless salesgirls, massage girls and such service jobs will disappear or become far more expensive as better paying jobs will be available elsewhere.

Good post.

But the TV crazies will tell you tourist arrivals are not increasing, it's all a ploy, fake tourists planted at Suvarnabhumi to con us farangs and GDP isn't moving upwards, industries are moving out of Thailand in their droves (never mind that the surging baht is itself proof they aren't).

Having said that with most Western countries printing money like there is no tomorrow it'll be very difficult to reign in the baht. Permission for exporters to pay in foreign currencies without having to change into baht is the only measure proposed here that could have any sort of impact.

Asia has to slowly decouple from the West and grow the Asian economies together.

They are still playing the "we are the poor east" game. This is no longer true.

The real wealth producers are in Asia, manufacturing countless goods that the West has to buy, because the West cannot compete. Asia does not have the overhang of debt and socialist government obligations the West has put itself under. The Western countries cannot keep dishing out free cash to its finance system to keep the poor bastards from sinking. Well, I suppose it can, but there will be a few issues down the line.

All asset classes in the West, including the currencies, are now massively miss-priced due to vast and unprecedented interference in the markets by the central banks.

The biggest industrial employer in the UK is owned by Indians. That says a whole lot.

All that stolen and fake wealth that the West is living on is slowly evaporating. And the Asians are becoming wealthier by the day.

The world is changing.

Plan and change accordingly....

[how241]

BoT has just to cut the interest rate so that the baht would't be so attractive to buy for foreign investors...less demand-> baht will fall..so easy !

+1

[fletchsmile]

I don't think Yingluck would be able to count to 7 if she was looking at the number of designer logos on her Luis Vitton handbag.

Baht as a regional trading currency? M-I-C-K-E-Y M-O-U-S-E as our 4 year old would sing. Total Mickey Mouse idea. Which country in their right mind would want to rely on Yingluck and the other clowns for their economic success.

I guess she also doesn't realise or understand that BOT don't exclusively look at the dollar as she suggests. Perhaps she should read BOT's website from time to time, or read up what "monetary policy" is.

Bank of Thailand have some very educated and intelligent people who know what they're doing these days. In contrast the Ministry of Funny ideas. BOT is a good control and check and balance against the corrupt clowns and clownettes or should I say puppets in power

Cheers

Fletch

[atyclb]

Given the level of government sophistication, perhaps the 7 point assignment = write "the thai baht will not appreciate" seven times on the blackboard.

[skorchio]

Go on do it, do something heavy handed, overshoot the target, cause a crisis, drop the baht to 36 to the dolla and I go buy me that Fortuner.

[hellodolly]

while the tourism and hotel industries are also calling for tax reductions to give them a competitive edge in the region.

Which part of the tourism industry is that? Mafia taxi drivers? Jet ski operators? Street vendors charging 120 baht for a plate of fried rice?

Or is the five star hotels charging Western prices for their services?

Who pissed on your cereal this morning.

Mafia taxi drivers? Are they all armed and of a certain European country decent?

Jet ski operators? None here in Chiang Mai or Bangkok

Street vendors charging 120 baht for a plate of fried rice. now you are just being silly

You might want to try to be a little believable.

[jacko45k]

"and reduce tariff on the import of jewellery to be exhibited in Thailand."

What possible relevance does this have to the Baht or employment in Thailand?????

She tried to slip that one by us but you picked up on it.

(She spotted some really nice stuff, and got some good gifts when on a foreign meeting recently..... probably not in Saudi Arabia)

[mccw]

Wanting to be a regional trading currency would mean a much greater demand for bht and therefore a price increase! Obviously she/ they really don't understand what they are talking about. Unless there is an unmentioned policy to print bht at some point coming to facilitate this regional trade role and stabilise against dollar. I doubt it though; they are not that bright. But I'd have thought the allure of printing presses would be even greater than the credit card. Luck the BoT is in dependant probably.

[Bellweather]

"and reduce tariff on the import of jewellery to be exhibited in Thailand."

What possible relevance does this have to the Baht or employment in Thailand?????

This is straight out of Adam Smith's best seller " An Idiot's Guide to Economics ". I'm sure the Father of Economics would have said if you want to protect your currency reduce the tariff on imported jewellery, it's just commonsense really.

[Rosco911]

They mostly called on the government to urgently solve the problem of labour shortage

I must be stupid.

So with a background of increasing tourist arrivals, a GDP moving upwards at a rate all western countries would be very happy to have and a shortage of labour, what, precisely, is the problem?

The BoT "manages" the THB against a basket of currencies, not just the USD. And can Yingluck not check out the FX rates at any Thai bank website including the Bank of Thailand?

http://www.bot.or.th/English/Statistics/FinancialMarkets/ExchangeRate/_layouts/Application/ExchangeRate/ExchangeRate.aspx

With historic rates here

http://www2.bot.or.th/statistics/ReportPage.aspx?reportID=123&language=eng

If Thailand wants to get the economy really chugging along, the super-rich have to

1. Let some of their wealth trickle down to the employees working long hours for 6,000 Baht/month.

2. Allow the education system to improve.

But, of course, that is exactly NOT what they want as maids, chauffeurs, countless salesgirls, massage girls and such service jobs will disappear or become far more expensive as better paying jobs will be available elsewhere.

Agree with the above but who is working for 6,000 Baht/month. Min wage is 300 Baht/day.