Thailand to lift remaining capital controls |
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Published
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Thu, 01 Mar 2007 00:35
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BANGKOK (XFN-ASIA) - Thailand will lift its remaining controls on capital inflows, the central bank governor said late Wednesday, hours after the finance minister announced his resignation.Bank of Thailand governor Tarisa Watanagase told a gathering of the Foreign Bankers' Association that the controls would be lifted today, more than two months after the measures were introduced.'Tomorrow (Thursday), the central bank will have a final review on the measures regarding capital inflows,' she said.'Fully hedged bonds, mutual funds and property funds will be exempted from the 30 pct reserverequirement.'Reserve requirements imposed in mid-December effectively lock up for a year 30 pct of any fundinflows coming into Thailand for financial investment.The day after the announcement, the Thai stock market plunged 15 pct, the biggest one-day drop by value in the 31-year history of the bourse, due to panic selling over the currency rules imposed to curb the Thai baht's rise.The bank was forced to make an abrupt U-turn on some of the requirements, and eased others in the following weeks.Tarisa's announcement that the remaining requirements would be lifted came just hours after Finance Minister Pridiyathorn Devakula announced his resignation.Pridiyathorn had defended the reserve rules as a way of helping exporters by trying to weaken the baht, which has gained sharply against the dollar, making Thai products more expensive overseas.afp/mas
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Bank of Thailand exempts more foreign investment inflows from capital controls 