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Undue politicisation at finance and BoT
Oped, Thitinan Pongsudhirak, Published on 03/07/2020
» Thailand's economic growth projections continue to head south as the coronavirus crisis unfolds in the second half of the year. In its most recent forecast, the Bank of Thailand anticipates a sharp contraction of 8.1% this year, worse than the 5.3% it predicted in March. Downside macroeconomic risks are substantial as the Covid-19 pandemic could still degenerate and cause further global health and economic havoc. In this dire environment, Thailand will need steady and seasoned hands to oversee macroeconomic levers. Yet both the finance ministry portfolio and the BoT governorship now face uncertainty and potential politicisation that bode ill for effective and autonomous fiscal and monetary policies.
Central bank autonomy must be upheld
News, Thitinan Pongsudhirak, Published on 16/08/2019
» When elected governments make noises about economic growth in countries where macroeconomic management is sound and prudent, central bankers tend to quietly bristle and brush off such interference and infringement of monetary space at their own risk. In so doing, central bankers tend to enjoy the support of domestic and international market participants who value central bank independence more than politicians' vested interests, even if it sometimes undercuts their bottom lines. Accordingly, when central bankers go along with the preferences of elected politicians, the conduct of monetary policy comes into question.