"LET RESERVES RISE TO WEAKEN BAHT"

       Bank of Thailand board chairman MR Chatu Mongol Sonakul said yesterday that the country's international reserves should go higher to help weaken the baht.
       "If the country's policies are pursued to help the trade sector, the economy will expand rapidly," he said.
       A depreciating baht would facilitate exports, which would drive economic growth, he said.
       The trade industry can expand limitlessly while the non-trade sector has high diseconomies of scale, he added.
       A vibrant export sector would help boost the non-trade sector eventually, which would help lift the entire economy, said Chatu Mongol, who has served as central bank governor and Finance Ministry permanent secretary.
       For example, China and Singapore have abundant foreign reserves, which have helped support their exports.
       The Kingdom could use its reserves to seek returns.
       For instance, it could lend to other countries, when it becomes a net lender. This could be done through a sovereign wealth fund.
       Thai assets abroad have built up gradually due to the policies to promote overseas investment. The central bank has kept relaxing its rules to allow local investors to pursue opportunities abroad, resulting in many investors going offshore to buy assets such as plants.
       The country is currently a net borrower and would become a net lender when its assets abroad are higher than the assets that foreigners hold here.