Bangkok: The Federation of Thai Industries (FTI) has called upon the government to conduct a comprehensive investigation into gold exports to Cambodia, aiming to manage the appreciation of the baht and its impact on the export sector.
According to Thai News Agency, the FTI has emphasized the need for a thorough examination of both buyers and sources of funds involved in the gold trade, amid concerns that the strengthening baht is disadvantaging Thai exports against competitors like Vietnam. The FTI advocates for a baht exchange rate of 34-35 per dollar to maintain competitive balance.
FTI President Mr. Kriangkrai Thienukul engaged in discussions with Prime Minister Mr. Anutin Charnvirakul to address economic challenges and the impact of US tariffs by industry. The FTI highlighted the necessity of negotiating with the US concerning Regional Value Content (RVC) and Local Content standards to protect Thai industries from adverse effects. Mr. Kriangkrai stressed the importance of supporting SMEs, particularly through measures like debt haircuts and credit expansion, as they face high household debt and limited access to capital.
The ongoing Thai-Cambodian border conflict has strained the industrial supply chain, prompting the FTI to seek government assistance in cost mitigation while maintaining national sovereignty. The private sector is advocating for economic stimulation through the “Made in Thailand” project, urging the government to increase local product procurement and enhance tax incentives for domestically manufactured goods.
Energy costs are another focal point, with the FTI urging government intervention to lower expenses for operators importing energy. Additionally, the FTI supports the continuation of the “Half-Half” project, which has been beneficial for businesses, and calls for stricter customs enforcement on substandard or misdeclared goods.
The appreciation of the baht, which has risen by 7% since the beginning of the year, is a significant concern for Thai exporters, as it places them at a competitive disadvantage, particularly against Vietnam. The FTI asserts that a stable exchange rate is crucial for maintaining Thailand’s export-driven economy, which constitutes 60% of the GDP.
The FTI’s findings indicate a dramatic increase in Thailand’s gold exports to Cambodia, with a 10-fold rise in 2024 compared to 2023. This surge, particularly during periods of border conflict, underscores the need for a detailed investigation into the trade’s authenticity and its potential impact on the baht’s value. Despite assurances from the Customs Department and the Ministry of Commerce, the FTI insists on a deeper probe to prevent adverse economic consequences reminiscent of situations observed in Switzerland and Dubai.
The FTI’s call for government action aims to ensure that any irregularities in gold exports are addressed promptly, safeguarding Thailand’s export sector and preventing further appreciation of the baht that could harm the country’s economic stability.