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Central bank economic
growth estimate unchanged
Bank of Thailand (BoT) Assistant Governor Paiboon
Kittisrikangwan on Friday announced that the central bank will maintain its
economic growth estimate for this year at 3.3-5.3 percent against a
contraction of 2.7 percent in 2009.
He said that Thailand’s gross domestic product (GDP) grew 4 percent in the
fourth quarter of last year and tended to expand further upon global
economic recovery, improved private consumption and investment and increased
exports.
Thailand’s economic recovery looks sustainable, he said, given the higher
consumer confidence and business confidence indexes.
The BoT projected GDP in 2011 will expand 2.8-4.8 percent, boosted by the
expected increase in private consumption and investment, and higher exports
and imports.
However, the Thai economy would continue to experience four risk factors
including the slower than expected global economic growth, a continued
slowdown in fiscal driving force, concerns and impacts from the investment
project suspension in the Maptaphut Industrial Estate, and persistent
political conflicts.
Paiboon said the inflation rate would remain low because the government
decided to extend measures to relieve living costs to the first quarter of
this year.
It is expected the general inflation rate would stay at 3-5 percent and the
core inflation rate at 1.3-2.3 percent.
Monetary policy implementation will return to normal this year if the
private sector conducts business steadily and the economy continues
expanding.
Still, higher oil and commodity prices must be monitored as it could fuel
rising inflation. He said the BoT will consider again whether it is
appropriate to raise the policy interest rate in the third and fourth
quarters.
“The interest rate adopted by the bank to boost the economic recovery is
considered especially low. If the economy recovers steadily, the interest
rate must return to normal because the bank must retain economic stability
in the long run,” said Paiboon.
Regarding the stronger baht, he allowed the central bank is unable to peg
the currency because it had adopted the managed float regime, but if the
baht fluctuated too heavily, the bank would attempt to supervise it to
prevent it from affecting the economic recovery. (TNA)
Thai, Vietnamese bourses to boost cooperation
The Stock Exchange of Thailand (SET) and the Hanoi Stock
Exchange (HNX) last Friday signed an agreement to exchange information and
experience in regulating the stock market.
The five-year Memorandum of Understanding (MoU) will also support business
opportunities for investors through network mechanism and business matching
activities that will increase the business value of listed companies.
Vietnamese companies and Thai-Vietnamese joint ventures are encouraged to
apply for dual listing on the stock exchanges of the two countries once the
laws and relevant regulations permit it.
“To a greater extent, this agreement will allow us to tighten the bonding
between financial markets in Thailand and Vietnam, making contributions to
the integrity of ASEAN economic community as highlighted in the spirit of
ASEAN alliance,” Tran Van Dzung, president of the Hanoi exchange said in a
statement.
SET president Patareeya Benjapolchai said the stronger cooperation and
relationships will further provide both business and investment
opportunities not only for the exchanges but also for all market
participants.
According to a SET recent survey, 43 percent of the listed companies
responding to the survey indicated interest in investing in Vietnam, and
some listed companies are exploring investment and business expansion
opportunities in Vietnam. (TNA)
Thailand’s central bank requires financial institutions to justify loan rejections
Bank of Thailand (BoT) Assistant Governor Pimpa
Thawarayut on Thursday revealed that the central bank has issued letters of
instruction to managers of all financial institutions, requiring them to
make clear explanations in case they disapprove or reject loan applications.
Reasonable explanations must be given, she said, noting that in the past the
central bank and the center tasked with liaising on addressing loan granting
problems had received complaints from intending borrowers that they received
unclear explanations from financial institutions over why they were refused
loans.
A Bank of Thailand survey also found guidelines for approving loans vary
widely among financial institutions, resulting in public confusion. More
importantly, the failure to clearly explain loan rejections might lead to a
negative image of such institutions as a whole.
Because of this, the BoT established guidelines to ensure uniform standards
and practices to boost public understanding. Also, it could help provide
unsuccessful loan applicants with useful information on how to improve their
financial position.
“We have sought cooperation from financial institutions to explain to
intending borrowers why they rejected their loan applications in writing. To
comply with official rules, financial institutions must give rejected loan
applicants easy access to the reasons and written clarification over their
failure to receive a loan approval,” she said. (TNA)
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