‘Thailand is no protectionist’

Bangkok, January 31:

Thailand’s finance minister today insisted that the country’s new policies on investment and capital inflows were not the start of a new protectionist movement.

Pridiyathorn Devakula said in a letter to the Asian Wall Street Journal that the new rules were meant to discourage currency speculation and to clear up grey areas in Thailand’s foreign investment law.

He said the rules had been “regrettably misunderstood and widely exaggerated,” adding that “we did not enact the measure with any protectionist intent. Thai government welcomes foreign investment and foreign participation in our economic activities.”

“We certainly do not pursue an inward-looking development strategy, nor do we want to reverse the direction of foreign investment policy.”

Pridiyathorn also tried to clarify the government’s vow to pursue a “sufficiency economy,” which is a vague idea promoted by Thailand’s King Bhumibol Adulyadej. He said the idea was not an economic model, but a philosophy that encourages moderation and effective risk management.

“While the market mechanism generates economic growth, the sufficiency economy helps limit excesses and secure economic stability and resiliency, thus bringing about long-term sustainable growth,” he said.

The policy changes introduced over the last two months have rattled Thailand’s economy and spooked foreign investors who were already jittery after the September coup that ousted prime minister Thaksin Shinawatra.