Thailand was charged with a line This has been several times. I didn’t hit the first time … Which every time we always insist that never Thailand has never ‘perverted the currency’ as allegedly, and in the last few years we have survived the “blacklist” all along.
This time … Okay that Thailand survived the “black list” as usual. But being in a group that needs to be “watched” is also daunting. Because the 3 criteria used by the United States to judge We have already surpassed one item and the other two are suspicious !!
Which is why we have to look at each other again What are the 3 criteria that we exceed?
Back Thursday, December 17, 2020, US Treasury Released a list of countries that must be watched that may qualify “Distort the money” (Currency Manipulator), which among those names is mostly “Asian”. And Thailand is one of them !!
And on the same day, the “baht” appreciated to 29.8 baht per US dollar. It fell below 30 baht per US dollar for the first time this year. If starting from July 20, 2020, the baht has appreciated more than 6%.
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Actually, I used to mention “Vietnam” since early October. When the charge follows … because it exports more to the United States than it imports Where the key variable is “money” This is different from Thailand, because they are “weak”, and when weak, Americans can order a lot of things … a problem arises !!
In just the first seven months of 2020, Vietnam was the fourth largest surplus of US trade surplus at 1 trillion baht, even though President Donald Trump was preparing to leave the chair. To make a speech “This is worse than China !!”
By in October U.S. Department of the Treasury It opened a Section 301 currency distortion investigation with Vietnam before it was suggested that Vietnam and Switzerland “Distort the money”
While “China” itself has maintained a solid state. In being watched that may fall into the “Currency manipulation” along with Thailand, South Korea, Japan, India, Singapore and Malaysia
The question is the US Treasury. What criteria are used to judge other countries as “currency manipulation” or just plain accusations?
There are 3 criteria for judging:
1. Trade surplus with the United States of more than 20,000 million US dollars or approximately 597,000 million baht.
2. A current account surplus of more than 2% of gross domestic product (GDP).
And 3. currency intervention and foreign exchange. Or buy more than 2% of US dollars of gross domestic product (GDP)
Which, if considered according to the criteria that said No matter what … Thailand cannot escape being watched. Because as you look at the numbers We are too over 2 items !!
How much is that too much?
Checklist of 3 criteria to judge the US targeting Thailand
The first: No trade surplus with the United States of more than US $ 20 billion (596,000 million baht).
It was found that in the first 10 months of 2020, Thailand had a trade surplus with the United States of more than 21.7 billion US dollars or about 647 billion baht.
Vietnam parts: In the first 10 months of 2020, a trade surplus with the US was more than 56 billion US dollars, or about 2 trillion baht.
Second: Do not have a current account surplus of more than 2% of GDP.
Thailand is expected to be more than 2% of GDP this year, with 2019 at 7% of GDP.
Vietnam parts: Current account surplus more than 4% of GDP.
And number three: Do not interfere with the currency and buy more than 2% of the US dollar of GDP.
According to the US Treasury Department, net purchases of the Bank of Thailand (BOT) at the end of June 2020 totaled US $ 10 billion, or about 298 billion baht, or 1.8% of GDP, which is still considered. Is below the threshold
Vietnam parts: Acquired accumulated US dollars equal to 3% of GDP.
But when asked, should I trust this when evaluating it?
In general, it is not very worrying. But it may cause policy makers to hesitate a little if they intervene.
All so It was suggested by Vietnamese analysts that In this case We could make an argument. That buying large volumes of the US dollar is to help stabilize the currency. And sincerely hope that As President Joe Biden may strongly agree that the allegations should be lifted.
While another view of analysts see In the next few months The US dollar has a chance to fall again. Because the economy is not very good and believes that the central bank (Fed) may have cut interest rates more than once in 2021.
But from the coming out of the charges in the United States. Many have flagged it as a deferring policy of President Trump. Who want to threaten Asian nations that from the “trade war” may enter the “currency war” in the future Because if compared with other countries in Asia, the US dollar is considered to be quite depressing.
Finally, for the Thai economy …
It is expected that this year 2020, GDP will shrink at least 7.7% because of the current situation. When will the income from foreign tourists account for 12% of GDP return? Private investment fell 8.9% from the same period last year.
Even though still not convinced that This year … Thailand will not be the worst in ASEAN. But I can be sure that in 2021, Thailand will definitely return !!
Author: like the sun
Graphics: Supassara Traiyansuwan
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