Gaybutton Posted March 30, 2009 Posted March 30, 2009 The following appears in THE NATION: _____ Olarn Wants Baht at 37 to US Dollar By Achara Deboonme The Nation Published on March 30, 2009 The United States and China, with a combined injection of over US$2 trillion (BtBt71 trillion) into their economies, would help the world to stage an economic recovery but Thailand still needs to lay its hands on some problematic areas, economist Olarn Chaipravat said. "The US and Chinese policies have made it clear that both will engineer the global recovery and the world should move in a more orderly way. "The question is whether Thailand is on the curve or behind the curve," he said in an interview. The US recently endorsed three policies: the $787-billion fiscal package, which combines $200 billion tax cuts; the $1.15-trillion quantitative easing policy to get more money circulating and bring down |a wide range of borrowing costs; |and the public-private partner-|ship programme (PPP) to buy out toxic assets and recapitalise |financially-ailing banks. Olarn commended the US's quick implementation of its programmes. The Federal Reserve implemented the credit policy in a matter of days, for example. Meanwhile, without any major public relations exercise, China has implemented three major policies: * Coupons were issued to poor Chinese for the purchase of some electrical appliances like washing machines * Starting from January 1, state-owned banks have been ordered to lend to specific areas like real estate - to keep prices from falling further - and consumer durable goods. * It has also recapitalised the Bank of China to strengthen its finances. China earlier unveiled a 4-trillion yuan or $586-billion economic-stimulus package, with little details of the spending. To Olarn, unlike the US whose policies appear in CNN or CNBC on a daily basis, China is low-profile but it has been doing something. Despite the actions of these two superpower nations, other countries like Thailand will still need to address their own problems, Olarn noted. His economic team expected March export value to plunge further by 30 per cent, and a sharp plunge is expected in the second and third quarters due to high bases in the previous years. Thailand's export value first declined in November and the fall continued until February. Against the 26.5-per-cent plunge in January, the February figures fell only 11.3 per cent due to the huge volume of gold exports. While the export value, which accounts for 70 per cent of gross domestic product, nosedives, the more worrisome is the steeper fall in imports. Trade surplus has increased because imports of the intermediate goods for re-export manufacturing dropped and exports will probably decline in the near future. Olarn said that to help the export sector, the baht should weaken to Bt37 at the end of this year, "or the economy won't recover". Meanwhile, boosting domestic lending would also help ease burden from the ballooning current-account surplus. Bank of Thailand Governor Tarisa Watanagase insisted on Friday that the central bank would not adopt the quantitative easing policy, citing that Thailand's credit market has slowed due to falling demand not a credit squeeze. On the government's planned spending of over Bt1.5 trillion during 2010-2012, Olarn noted that the size matters less than the targets of the spending. "The government must be clear what it wants to accomplish. Importantly, it needs to create jobs and generate value in the form of tax revenues," he said. Quote
Up2u Posted March 30, 2009 Posted March 30, 2009 ... Olarn said that to help the export sector, the baht should weaken to Bt37 at the end of this year, .... Could we make that tomorrow please!!! Quote
Guest fountainhall Posted March 30, 2009 Posted March 30, 2009 Better still, make it 40 to the dollar again, please! Quote
KhorTose Posted March 30, 2009 Posted March 30, 2009 Better still, make it 40 to the dollar again, please! I think the Thai governments ability to control the Baht to Dollar ratio is pure bullshit. Yes, I would be willing to bet you will see at least 40 to the dollar soon. Quote
Gaybutton Posted March 30, 2009 Author Posted March 30, 2009 Yes, I would be willing to bet you will see at least 40 to the dollar soon. May you be granted a thousand perfect boys if you turn out to be right . . . Quote
