Thai government urged to import capital goods, materials during strong baht

BANGKOK, April 29 (TNA) - The Thai Ministry of Finance's Fiscal Policy Office (FPO) has suggested that the government import capital goods and construction materials needed for its new infrastructure development projects over the next seven years, worth about 2 trillion baht. Pisit Puapan, Director of the FPO's Macroeconomic Analysis Division, made the call on Monday, as the needed imports account for some 40 per cent of the new projects' total costs and they will help relieve the baht appreciation. Pisit also recommended that Thai business operators expand their businesses overseas and state enterprises repay their foreign debts early. The senior Thai official acknowledged that the management of foreign exchange rates is a difficult and sensitive task because it may affect trade and exports. According to the senior official, the Thai baht has appreciated by 6.6 per cent a US dollars so far this year; while the currencies of neighbouring countries have only been stronger by some 2 per cent. Meanwhile, Bangkok Bank Executive Vice President Kobsak Pootrakul cautioned that the strong baht has reduced competitiveness of Thai exporters by 5-7 per cent, attributing the continual baht appreciation to capital inflows, worth over 800 billion baht so far, to invest in domestic bonds, urging the Bank of Thailand (BOT) to keep the value of the Thai baht in accordance with the values of other currencies in the region. (TNA)