Prime Minister Yingluck Shinawatra today outlined an urgent seven-point measure to rein in the surging baht and tackle Thailand’s labour shortage.
According to a government spokesman, Deputy Prime Minister/Finance Minister Kittiratt Na-Ranong was instructed to carry out the proposed measures, including a push for the baht as a regional trading currency, expanding vocational education to solve the labour crisis, promoting the use of domestic raw materials for local industries, especially in auto production, and exemptions of value added tax (VAT) for export industries and permission for exporters to pay in foreign currencies without having to change into baht.
Private sector wants the baht to stabilise at Bt29-30 against the dollar
The finance minister was instructed to find loan sources for local manufacturers and reduce tariff on the import of jewellery to be exhibited in Thailand. The prime minister also asked that the Bank of Thailand (BoT) provide currency comparisons between the baht and other currencies without exclusively pegging itself to the US dollar. Mr Kittiratt reportedly informed today’s cabinet meeting of the recent Finance Ministry meetings with the private sector, exporters, the Monetary Policy Committee, the Federation of Thai Industries (FTI) and the Thai Chamber of Commerce (TCC) to discuss the impact of the appreciating baht.
The prime minister instructed the Finance Ministry to hold similar sessions with the labour, education, industry and commerce ministries to find joint solutions to the challenges. Mr Kittiratt said cabinet members were confident that the BoT will be able to stabilise the baht, adding that the private sector wants to see the baht movement stabilise at Bt29-30 against the dollar. In the short term, manufacturers of electrical appliances, refrigerators and air-conditioners have asked for lower VAT while the tourism and hotel industries are also calling for tax reductions to give them a competitive edge in the region. They mostly called on the government to urgently solve the problem of labour shortage. (MCOT online news)
