Strong baht, shortage of migrant workers

[reader]

From The Nation

Thai exporters are upbeat about business prospects, citing gradual increase in demand, but they are worried about the baht strengthening as well as the shortage of migrant workers.

The Thai National Shippers’ Council (TNSC) has revised upward its export projection this year to 8 per cent contraction from 10 per cent contraction previously forecast, says Ghanyapad Tantipipatpong, the council chairman.

Products in demand include rubber gloves, washing machines, fax machines, telephones and parts, and gold, she noted.

The baht remains strong and can be an obstacle for exports, as it makes Thai products more expensive than products of competitors. The baht should stay at around Bt34 per dollar, down from the current Bt31 level,  or it must move along with regional currencies, she said.

A shortage of migrant workers is also adversely affecting businesses, she complained.  The rise of logistics cost, including freight cost, is also a cause for concern, she pointed out.

[10tazione]

18 hours ago, reader said:

From The Nation

fax machines

Really?

[anddy]

2 hours ago, 10tazione said:

Really?

LOL yeah thought the same thing 

Just been thinking the other day how odd it is that the Baht is so strong again. It has recovered most losses it had incurred at the beginning of the pandemic and I wonder how and why. General investor sentiment is of course more or less ignoring the pandemic and in a "risk on" mode, but 40 million tourists not buying any Baht this year must have a noticeable impact I would assume. But evidently not....

[Guest]

The baht has been strengthening.    Whether that means the baht is "strong" is another matter.

1   If we're referencing past exchange rates, then this might be exhibiting some "price anchoring" to exchange rates which took a very long time to recover after the Asian financial crises. Graph below.

2   The 34 baht figure is against the USD and new USDs are being created at an astonishing rate, whilst the US is running up incredible debts with an idiot as president.  So there isn't really any reason for the USD to be strong.  

3  Thailand has mostly run a significant positive balance of trade surplus in the last few years, suggesting it's economy is competitive at these exchange rates.

4  The cost of goods and services in Thailand is typically quite competitive, again suggesting the exchange rate is reasonable.

 

The following is NOT aimed at Anddy's comment above, rather at comments I sometimes see elsewhere:   

Some people think the baht is stronger than it should be, yet their main explanation for this view is they want the baht to be cheaper so they can enjoy a better lifestyle in Thailand.  Now whilst I would also like a weaker baht,  this does not mean the baht is stronger than is should be.  Economics doesn't work like that.  

I liked the almost 70 baht to the pound that I got on my first visit, but this is no basis for me to argue that the THB is incorrectly priced at 40 to the pound.  

 

 

[reader]

When I came across the fax machine quote from the spokesperson for the Thai National Shippers’ Council, it struck me as odd in this day and age. But apparently Thailand has found a niche manufacturing demand for a relatively low-tech product. The machines can be the traditional stand-alone units we're all familiar with from the past of combined into the more widely popular all-in-one machines (phone, fax, printer and copy).

Came across a site that addressed the issue with 16 reasons people still prefer the "fax" feature. Three of the reasons seemed to carry the most weight, particularly the first where web security is becoming an increasingly critical factor.

1. It can be isolated from the internet
2. Confirmation pages (proof of message receipt) – the most import reason.
3. Japanese, Chinese, and Korean characters are often written