Thai government urged to control capital inflows, assist SMEs

BANGKOK, April 30 (TNA) - The Thai National Shippers’ Council (TNSC) has urged the government to control capital inflows to relieve the appreciation of the Thai baht since early this year and to inject some 100 billion baht to assist local small and medium-sized enterprises (SMEs) affected by the strong Thai baht. TNSC Vice Chairman Vallop Vitanakorn told journalists on Tuesday that noticeable impacts from the strong baht on Thai exports should appear from the second quarter of this year onwards and the government, through the Bank of Thailand (BOT), should issue decisive measures to cope with the baht appreciation. Vallop called on the BOT to intervene to weaken the Thai baht and to impose either the capital gain tax or capital control to relieve the baht appreciation, acknowledging that the Thai private sector want stable exchange rates. TNSC Chairman Nopporn Thepsittha pointed out that the baht appreciation limited Thailand's year-on-year export growth at only 4.55 per cent in March 2013, saying if the total value of the Thai exports was calculated in baht last month, its growth stood even only at 1.47 per cent. According to the TNSC chair, the baht appreciation has been some 10.75 per cent higher than that of other currencies in the region; so, local exporters have found it difficult to estimate their costs and set their product prices. The TNSC chair predicted, however, that Thai exports should expand by only 4.92 per cent year-on-year this year, in case that the baht value stood at 28.25 baht a US dollar, the estimation of which was revised downwards from the 6.9 per cent year-on-year export growth projected early this year, as the baht appreciation has reduced Thailand's export value by over 4.7 billion US dollars so far. Against the Japanese yen, the TNSC chief indicated, the Thai baht now remains as much as 24.7 per cent stronger and the baht appreciation against the yen is 3-5 per cent higher than the appreciation of other currencies in the region. Besides, Japan, a major market of Thai exports, has increases its consumption tax, which will likely cut Thai exports to Japan by 2.15 per cent, with exports of Thai farm products, including processed ones, expected to be the hardest hit and to lose competitiveness, recommending that local business operators add their product values to maintain their overseas markets. (TNA)