Thailand's Finance Minister Pridiyathorn Devakula has called for China to allow its currency to rise against the US dollar, and defended foreign currency controls that he said were imposed to save the country's export-dependent economy.
"If currencies of our [export] competitors appreciate more or less at the same level as ours, I don't think we would need this measure any more," he said.
``It would help a lot [if China revalued the yuan], but it would depend on the degree of revaluation,'' he said.
Pridiyathorn, the former central bank governor and US-trained economist, said he watched with alarm as foreign investors poured three times more cash into the country in the first week of this month than they a typical week last month, sending the baht to a nine-year high against the US dollar.
"A small nation like ourselves -- if we don't protect ourselves, who else will protect us?" he said.
With exporters complaining about the strengthening baht, he said something had to be done to rein in speculators who were behind the surge and protect the economy.
"We have to save our country. We have to save one of the growth engines, which is exports," he said.
While the measures imposed last Monday inflicted pain on investors, failing to stem the baht's rise would have had even worse negative long-term consequences for economic growth and the stock market, he said.
"If we didn't do anything, the stock exchange would have plunged further and the catastrophe would have been more severe," he said.
Still, Pridiyathorn -- who until now has courted little controversy -- and the central bank have faced a barrage of criticism from investors inside and outside the country who endured a wild financial ride since the controls were first announced Monday night.
Thai shares plunged nearly 15 percent last Tuesday but then bounced back 11 percent on Wednesday after officials rescinded the curbs on foreign stock investing while retaining them on bonds and other debt instruments. The market flattened out the rest of the week.
The baht, meanwhile, weakened more than 3 percent over the course of the week since hitting a nine-year high last Monday of 35.09 per US dollar. Pridiayathorn pronounced himself satisfied on Friday that the measures had achieved their desired effect on the currency.
Pridiyathorn is one of the most respected members of the interim Cabinet appointed by the military after the September coup that ousted elected prime minister Thaksin Shinawatra. After getting an MBA from Wharton School of Business at the University of Pennsylvania, he spent the next three decades in the commercial banking sector including the Thai Farmer Bank, Export-Import Bank of Thailand before becoming central bank chief in 2001.
But last week's events -- particularly the policy flip-flop -- have tarnished Pridiyathorn's reputation a bit.
"The measures were too strong and beyond the comprehension of investors," said Teerana Bhongmakapat, an economist of Bangkok's Chulalongkorn University. "It shows that the policy was made without thorough consideration. Foreign investors may think the authorities in this country will just do whatever they want."
Thitinan Pongsudhirak, political scientist at the university, said he expected strong pressure to replace Pridiyathorn.
"The mistake has seriously undermined the government's credibility," he said. "The pressure will keep increasing and Pridiyathorn will be a liability that continues to undermine the government's credibility."
But for now, that appears unlikely with markets stabilizing and Prime Minister Surayud Chulanont on Thursday expressed full support for his economic team, including Bank of Thailand Governor Tarisa Watanagase.
Pridiayathorn also said that the capital curbs were temporary, but gave no time frame for when they would all be lifted.
MORE ARRIVALS ALLOWED: Taiwan yesterday increased its cap on arrivals to 60,000 from 50,000 ahead of a full border opening with a weekly cap of 150,000 on Oct. 13 Travelers arriving in Taiwan from Oct. 13 would no longer be required to quarantine on arrival and visitors of all nationalities would be allowed to enter, Premier Su Tseng-chang (蘇貞昌) announced yesterday. However, the number of arrivals would be capped at 150,000 per week, he added. Travelers aged two or older would be given four rapid antigen COVID-19 test kits on arrival and be asked to monitor their health for seven days, Cabinet spokesman Lo Ping-cheng (羅秉成) told a news conference. Under the new arrival protocol, travelers would have to take a test on the day of arrival or the day after, followed
SOVEREIGN NATION: The Chinese premier’s remarks about the CCP’s resolve to achieve unification sought to undermine the legitimacy of Taiwan, the MAC said Taiwan will never accept Beijing’s attempts to undermine its sovereignty, the Mainland Affairs Council (MAC) said yesterday, after the Chinese Communist Party (CCP) at its National Day celebrations in Beijing vowed to achieve unification with Taiwan. The CCP’s statement was not conducive to peaceful cross-strait relations, the council said. The event, hosted by the Chinese State Council, featured Chinese President Xi Jinping (習近平), Chinese Premier Li Keqiang (李克強), the other five CCP Politburo Standing Committee members and Vice President Wang Qishan (王岐山), as well as 500 guests from China and abroad. Taiwanese based in China also attended the ceremony, Xinhua news agency
The Kaohsiung District Court has ordered a man to pay a convenience store NT$600 (US$18.83) in compensation for using his own mug to refill a pot of tea eggs, ruling against the store manager’s NT$1 million claim. In May, during the peak of a domestic COVID-19 surge, a man surnamed Lee (李) added water from his mug to a pot of tea eggs after seeing it was nearly dry. A clerk stopped Lee, then discarded all 60 eggs in the pot, worth an estimated NT$600, after consulting with the manager, it said. The manager sued Lee, demanding NT$1 million for damage to the
Washington is evaluating a transfer of weapons systems requested by Taiwan, according to a copy of a report by the Ministry of National Defense (MND) that is to be submitted to lawmakers tomorrow. Asked whether the AGM-158 Joint Air-to-Surface Standoff Missile would be among the weapons systems, the ministry refused to comment, but said that it would not rule out announcing the specifics later this year. The ministry’s domestically sourced high-priority military investments include submarines, next-generation light frigates, rescue ships, advanced trainer jets and infantry fighting vehicles, the report said. Planned deals include F-16A and F-16B jet performance upgrades, navigation and targeting