Thailand’s minister of finance resigned less than a month after he took office, injecting more uncertainty into an economy already reeling from its worst crisis in decades.
The nation’s currency tumbled the most since July.
The resignation of Predee Daochai, a former copresident of Kasikornbank PCL, took effect from yesterday, according to a Royal Gazette announcement on Tuesday.
Predee, 61, was named as the new minister of finance on Aug. 6 and joined Thai Prime Minister Prayuth Chan-ocha’s Cabinet on Aug. 12.
Predee resigned because of ill health, Prayuth said, adding that the minister’s resignation would not derail government policies.
A new minister of finance would be appointed at the “appropriate time,” he told reporters in Bangkok yesterday.
Prayuth might approach outgoing Bank of Thailand Governor Veerathai Santiprabhob and former PTT PCL president Pailin Chuchottaworn to replace Predee, Thai-language newspaper Krungthep Turakij reported earlier, citing a source from the government house.
A spokesman for the central bank said he was not aware of Veerathai being approached for the job.
The baht yesterday tumbled as much as 0.8 percent to US$31.301, the most since July 16. The benchmark SET index rose 0.8 percent to close at 1,315.88.
The economy is on track for its worst contraction on record, with the Thai Ministry of Finance predicting an 8.5 percent decline this year as the nation’s key growth drivers of tourism and trade slump.
Prayuth last month made several changes to his economic team to help shape the government’s response to the economic crisis.
However, Predee’s resignation would hurt investor confidence, said Amornthep Chawla, head of research at CIMB Thai Bank PCL in Bangkok.
“The urgent task for the government now is to restore confidence. They need to find a qualified replacement who has good background and is accepted by the market,” Amornthep said.
“Investors are still waiting to see the continuation of the existing economic policies drafted by the last economic team and they haven’t got the answer yet,” he added.
The central bank is also facing a shake-up. Sethaput Suthiwart-Narueput is to take office as governor to replace Veerathai when he leaves at the end of his term this month.
While the government has announced US$60 billion of stimulus measures and the central bank lowered interest rates to a record low, it might take the economy at least two years before returning to the pre-pandemic level, the Bank of Thailand has said.
“There is an urgency now for having a well-functioning economics team because many of the ad-hoc programs crafted back in April to cushion the downside from COVID-19 measures are finishing soon,” Maybank Kim Eng Securities (Thailand) head of research Maria Lapiz said.
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