AWOL Issue 234

Page 1

AWOL Cha Am

7 June 2013

FREE weekly issue 2 34

To Hull And Back Crosswords Weird News The Good Doctor

bouncing baht? troubled economic times loom for thailand?

hua hin, THAILAND A warning issued on Wednesday by the Bank Of Thailand that there was likely to be a period of volatility in the value of the Baht in the coming weeks and months following hard on the heels of the news that the ratings agency Moody’s was likely to downgrade the Thai sovereign debt rating, has raised fears that the Thai economy might be facing a crash similar to that it experienced in 1997. Moody’s cited the government’s rice pledging scheme, which it is alleged has cost the country 250 billion baht, as a key reason for the likely downgrade, but Prime Minister Yingluck Shinawatra ordered an immediate verification of the status of the scheme in a bid to determine its profitability and counter Moody’s perceptions. Many observers have been expecting the baht to weaken for some time now, and the announcement from the central bank, which comes after they cut the interest rate by a quarter of a percent, seems likely to see the currency fall, something that both tourists and many expats will not be too displeased about. If that scenario does unfold, the effect on Hua Hin and the surrounding areas, which are becoming increasingly dependent on tourism, is likely to be beneficial, particularly if any depreciation in the currency remains through the next high season. However the downside is that the price of fuel would also likely rise and have a knock on effect to the prices of other goods. Imported goods would also become more expensive, but exporters would have an easier time selling their products abroad. Exchange rate information for a range of currencies against the baht is on page 26.

Victor

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