The Finance Ministry’s plan to slap a 15-per-cent withholding tax on foreign investors’ bond trading would not badly affect the market, Thai Bond Market Association president Niwat Kanjanaphoomin said yesterday.

He said the measure would raise investment costs and could lead to a drop in trading volume from foreign investors, but if it were only for the short term, the scale of the impact would be small.

According to the association, in the first nine months of the year foreigners were net buyers of Thai bonds, excluding Bank of Thailand issues, to the tune of Bt120 billion, representing a 13-per-cent increase from the same period last year.

“Foreign investors focused on buying bonds, especially long-term ones with a maturity period of more than 10 years because of the highest returns, while short-term bonds of less than one year give fixed returns,” said Niwat.

Ariya Tiranaprakij, executive vice president of the association, said foreign investors might underweight their investment in Thailand as a result of the measure.

via Short-term effect of bond withholding tax only small: TBMA.

Finance Minister Korn said in an e-mailed response to questions yesterday that details of any new measures would be available after the cabinet meeting. Overseas investors poured a net $1.1 billion into Thai bonds this month after pumping a net $4.9 billion in the third quarter, Thai Bond Market Association data show.

Government bonds rose, snapping a two-day slide. The yield on the 3.625 percent debt maturing in May 2015 fell nine basis points to 2.619 percent. The rate yesterday advanced the most in five months.

About the author

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Sign Up for Our Newsletter

Get notified of our weekly selection of news

You May Also Like

Top 50 APAC firms lose $900 billion market capitalization in Q3 2022

In Q3, 80% of the top 50 companies reported a decline in MCap from the previous quarter. Geo-political issues between the US and China over Taiwan, government regulations on tech stocks, and prolonged mass lockdowns impacted the Chinese market

Thailand’s New Five-Year Investment Promotion Strategy

The statement suggests that over the next five years, the BOI will put greater emphasis on increasing support for both domestic and foreign investors by improving Thailand’s business environment and ease of doing business

The Philippines’ 12th Foreign Investment Negative List: Implications for Foreign Investors

The Philippines’ 12th Regular Foreign Investment Negative List was issued in June…