Baht Appreciation Places Thailand Businesses On Panic Mode
Thailand is now urged to act in response to the country’s strengthening currency. However, it might be a tough balancing act when the country is actively receiving foreign direct investments.
The Nation noted Thailand’s private sector is on panic mode after Thai baht rose to 32.91 against the greenback on 23 September 2024, appreciating 12% from the previous week, versus around THB 37 to the dollar in January this year. This appreciation could translate to a whopping THB 130 billion in lost export earnings.
The Thai Chamber of Commerce (TCC) believes that with the baht appreciating to 33 to the dollar, the export of fresh and processed farm goods has already missed more than THB 50 billion in revenue. If this trend continues until the end of the year, the export industry may lose up to THB 130 billion of revenue, accounting for about 1% of the country’s GDP, it added.
TCC Chairman Sanan Angubolkul said at a meeting with private sector representatives on Monday, (23 September 2024) that the TCC will soon hold talks with the Finance Ministry and Bank of Thailand to discuss the use of financial and monetary policies to tame the currency.
Other topics on the agenda are rising debts of households and SMEs as well as dropping purchasing power, he added. At the meeting were representatives of seven business associations, namely the Thai Rice Exporters Association, Thai Broiler Processing Exporters Association, Thai Tuna Industry Association, Thai Pet Food Trade Association, Thai Frozen Foods Association, Thai Food Processors Association and Thai Hotels Association.
Sanan told business leaders he hoped the discussion with the two entities would explore in-depth economic data and eventually reach a conclusion pointing in the same direction, which would help restore investors’ confidence.
“We believe the Bank of Thailand’s Monetary Policy Committee is on top of the situation, and will not let us make the same mistake as during the Tom Yam Kung crisis [in 1997],” Sanan added.
The TTC chairman added the Joint Standing Committee on Commerce, Industry, and Banking (JSCCIB) will also submit a white paper on proposed measures to solve economic problems to the government.
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