JCR affirms Thailand’s credit rating at A+

BANGKOK, March 31 (TNA) - Japan Credit Rating Agency Ltd. (JCR) has affirmed credit rating for Thailand at A+ and on the country’s long-term debt instruments in the Thai baht and foreign denominated currencies at A and A- respectively. The Thai Ministry of Finance’s Foreign Debt Management Office (FDMO) reported the updates on March 30, noting that JCR’s affirmation of Thailand’s credit rating at A+ reflects the Kingdom's economic stability cushioned by industrial export growth, the stable banking sector and strong fiscal and current account positions. However, JCR cautioned that negative factors which might affect Thailand’s economic growth in the future include a middle income trap due to declining labour forces and rising labour wages. JCR pointed out there are signs that Thailand’s rating would remain stable in the future because of improved social and domestic political stability. Besides, industrial integration supported by the government, the distribution of high technology of industrial goods and a favourite country destined by international tourists would maintain Thailand's credit rating at the stable level. JCR forecast, however, that Thailand’s economic growth in 2016 would be limited due to sluggish exports and high household debts at up to 80 per cent of the country's gross domestic product (GDP) now. JCR also predicted that Thailand’s public debts could rise, as the government is developing transport infrastructure projects, worth about 1.8 trillion baht. According to JCR, it will closely monitor the Thai government's solutions to the country’s aging society problem and to the middle income trap, as a new general election is expected in Thailand next year. JCR acknowledged that a close monitoring would also be made on Thailand’s capital movements and on international reserves if the US Federal Reserve (FED) raised its interest rates in the future. (TNA)