BANGKOK (Xinhua): The Thai central bank on Wednesday (Oct 14) said in its weekly press conference that it will ease overseas investment rules by early next year, allowing more capital outflow, to temper down the strong Thai baht currency.
The Bank of Thailand (BoT) will increase the limit on foreign currency deposits and allow money transfers between foreign currency deposits held by individuals and companies, said Mathee Supapongse, assistant governor of the Bank of Thailand (BOT).
Mathee said that the pledge to ease rules on capital outflow follows the Thai baht's surge from a 17 month low in April that threatens to create more challenges for the Thai economy, which relies heavily on tourism and export.
These factors have been hurt by the virus pandemic, and continued baht gains pose a risk to export competitiveness, he said.
"We're looking to create an ecosystem that will make it easier for Thai investors to invest abroad," Mathee said.
"Therefore this new measure will not only help reduce the pressure on the baht but also diversify risks."
Mathee said that the Thai baht had rallied more than 6 per cent from this year's low in April, prompting the central bank to warn that if the currency were to strengthen quickly, it could hurt the nation's economic recovery.
"Thailand has been grappling with currency strength for a number of years," Mathee said, adding "Therefore the proposed changes to capital outflows rules will provide flexibility to all categories of investors."