The Bank of Thailand will have the final say on whether to lift controversial capital controls imposed in December 2006 to rein in a surging baht, says a senior member of the incoming government. ''It is a matter that the central bank will have to decide and we will certainly discuss the issue with them,'' said Surapong Suebwonglee.
''A year after it was implemented, many measures have already been eased. We want to know how they want to continue this policy,'' said the secretary-general of the People Power Party (PPP) which leads the new coalition.
The PPP made abolishing the controls a key promise in the Dec 23 election.
''We did say in our campaign platform we want to scrap this policy but now we are in the government. We have to be careful about what we say or do
,'' Dr Surapong said.
Bank of Thailand officials have resisted calls to abolish the controls completely, saying the baht was still rising too quickly.
Dr Surapong also said the new government would take another crack at revising the Foreign Business Act (FBA), which the military-appointed interim government tightened but failed to get through parliament.
Business leaders complained that the tighter rules on foreign investment would drive away investors, while a bid to limit foreign management control under the FBA could have violated Thailand's commitments to the World Trade Organisation.
''The existing law must be modernised to meet world standards, but it must not be an attempt to burn the entire forest just to kill a rat,'' Dr Surapong said. REUTERS
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