The Bank of Thailand Bond Issuance Programme for 2023

​The Bank of Thailand (BOT) issues BOT bonds as one of the monetary policy instruments used to manage money market liquidity, while fostering the development of a liquid and efficient debt securities market in Thailand. The annual BOT bond issuance programme is regularly communicated to the market at the start of each year to facilitate smooth and efficient liquidity management among market participants.

 

For 2023, the bond issuance programme takes into account the projected liquidity condition in the market, the expected demand for public debt securities and the financing needs of the government. To this end, the BOT and the Public Debt Management Office (PDMO) have been collaborating closely on bond issuance, in order to maintain an appropriate level of overall public sector bond supply throughout the year. Moreover, the BOT will further support the development of THOR-linked floating-rate bonds (FRB), which helps promote the use of THOR as a new reference rate.

 

Details of the 2023 BOT bond issuance programme are as follows

  1. Adjust the range of auction size for 3-month bills and 2-year fixed-coupon bonds to allow more flexibility in accommodating fluctuations in liquidity and ensure an appropriate level of overall public sector supply. The maximum auction size is raised to 80,000 million baht per week for 3-month bills and 40,000 million baht per auction for 2-year fixed coupon bonds.

 

  1. Reduce the number of issues per year for the 2-year floating-rate bonds from 2 to 1. Each new issue will be re-opened for 5 times over a period of 12 months, with auctions taking place on even months as in the previous year. The longer re-opening schedule will allow for more sizable bond outstanding in the market, which will support greater market liquidity of the 2-year FRB. 1

For the monthly bond schedule, auction sizes will be determined based on the prevailing conditions in the money and bond markets, as well as the government and SOE’s bond

 

supply at the time. The BOT will continue to collaborate closely with the PDMO and will announce the monthly auction calendars on the BOT website as customary.

 

Source: Bank of Thailand

Press Release on the Economic and Monetary Conditions for December and the Fourth Quarter of 2022

​In December 2022, the Thai economic recovery maintained its traction despite the slowdown in the global economy. The service sector continued to be the main driver of growth thanks to a good outturn in foreign tourist arrivals, which also benefited private consumption. Meanwhile, the value of merchandise exports slightly increased but contracted on a year-on-year basis, following a slowdown in trading partners’ demand, which in turn exerted downward pressures on manufacturing production and private investment. Public spending was at a similar level compared to the same period last year.

 

On the economic stability front, headline inflation increased from the previous month due to higher fresh food and energy prices, while core inflation remained close to the previous month. Developments in the labor market was in line with the economic recovery. The current account became a surplus as trade balance improved, while the net service, income, and transfer balance also exhibited a slight surplus thanks to higher tourism income.

 

Details of the economic conditions are as follows:

The number of foreign tourist arrivals, after seasonal adjustment, increased from the previous month in several nationalities, especially tourists from Malaysia and Russia. Positive effects of easing restrictions in international travel continued to persist and benefited Thailand’s service sector, particularly among the tourism-related businesses.

 

Private consumption indicators, after seasonal adjustment, increased from the previous month mainly from spending in the service sector on the back of increasing foreign tourist arrivals. Several fundamental factors supporting household consumption continued to improve, especially in employment and consumer confidence. Nevertheless, the elevated living costs as well as a slowdown in farm income growth in some regions still weighed down on private consumption.

 

The value of merchandise exports, excluding gold and after seasonal adjustment, slightly increased from the previous month but remained contracted on a year-on-year basis due to the slowdown in trading partners’ demand. Major export categories which saw improvements were (1) agricultural products such as cassava and durian (2) automotives, following an improvement in shortages of production materials and (3) electronics, which increased slightly due to its delivery cycle.

 

Manufacturing production, after seasonal adjustment, decreased from the previous month, especially the production of electrical appliances and chemical products, following a slowdown in the global demand. Production of automotives also declined after performing well in the preceding period. However, production of petroleum products picked up after the major shutdown of oil refineries for maintenance in the preceding periods.

 

Private investment indicators, after seasonal adjustment, decreased from the previous month in all categories. Lower investment in machinery and equipment was in line with the slowdown in manufacturing production, while investment in construction edged downward due to lower sales of construction materials as well as lower permitted areas for construction.

 

The value of merchandise imports, excluding gold and after seasonal adjustment, increased from the previous month in several categories, especially imports of crude oil after the reopening of oil refineries. Imports of consumer goods also increased from higher imports of smartphones and electric vehicles.

 

Public spending, excluding transfer payments, was at a similar level compared to the same period last year. Current expenditures expanded from a good disbursement of pension and medical expenses of public servants. Capital expenditures of state-owned enterprises also expanded, following a higher disbursement in energy and utility projects. Capital expenditures of the central government, however, contracted due mainly to a high base last year.

 

On the stability front, headline inflation increased due to the low base effects in both fresh food and energy prices. In addition, sluggish output of vegetable also added upward pressure on fresh food prices. Core inflation, however, was close to the previous month. Labor market gradually improved in line with the economic recovery as reflected by the numbers of total contributors to the social security system, which remained high near the pre-COVID level, while positive sentiments among the self-employed continued to be observed. The current account became a surplus as trade balance improved, while the net service, income, and transfer balance exhibited a slight surplus thanks to higher tourism income. On exchange rates, the baht against the US dollar appreciated, following the faster-than-expected reopening of China, which caused positive sentiments on the outlook of tourism industry in Thailand. Meanwhile, the market expectation on the slower pace of monetary tightening from the US Federal Reserve also added appreciation pressure on the Thai baht.

 

The Thai economy in the fourth quarter of 2022 continued to improve from the previous quarter on the back of increasing foreign tourist arrivals, which bolstered services and private consumption growth. However, the value of merchandise export deteriorated due to a slowdown in trading partners’ demand and exerted downward pressures on manufacturing production and private investment. Spending of the central government expanded mainly from current expenditures, while capital expenditures of state-owned enterprises also expanded from a good disbursement in energy and utility projects. On the economic stability front, headline inflation decreased, following a lower energy inflation, while core inflation increased due mainly to higher prepared food prices. Labor market gradually improved in line with the economic recovery. The current account became a surplus as trade balance improved, while deficits in the net service, income, and transfer balance moderated.

 

Source: Bank of Thailand

Announcement of Special Holiday for Financial Institutions and Specialised Financial Institutions

On 10th January 2023, the Cabinet has announced that 5th May 2023 is a public holiday in order to stimulate economy, especially for business and tourism sectors impacted by the COVID-19 outbreak.

 

The Bank of Thailand (BOT) has considered and deemed appropriate to declare that 5th May 2023 is a special holiday for financial institutions and specialised financial institutions to support the government’s policy.

 

Source: Bank of Thailand

U.S. launches private refugee sponsorship program

The U.S. State Department launched a new program on Thursday called the Welcome Corps that will allow Americans to privately sponsor refugees applying to move to the United States.

The program, formed in partnership with the U.S. Department of Health and Human Services, plans to place 5,000 refugees with 10,000 American sponsors in its first pilot year, a State Department press release said.

It is intended to “enable Americans to sponsor refugees … directly support their resettlement, and make a difference by welcoming these new neighbors into their communities,” it said.

The State Department plans to partner with “members of faith and civic groups, veterans, diaspora communities, businesses, colleges and universities, and more.”

Vietnamese Hoang Trong Man, who fled to Thailand in 2018 to avoid a crackdown by security forces as part of his membership in an opposition political group, said he hoped the new program would enable him and other asylum-seekers to immigrate to the United States.

“I am extremely happy as this program can help refugees like us get settled sooner,” he told Radio Free Asia. “It brings hope to many people who have been living in Thailand as refugees for years.”

Asylum-seekers in Thailand face the risk of arrest and detention in Thai immigration detention centers because the Thai government has not signed the International Convention on Refugees, he said.

Former President Donald Trump had slashed the cap on refugees allowed into the United States to 15,000. The administration of President Joe Biden has raised that number to 125,000.

Small groups could sponsor a refugee

The program will also allow groups to collectively sponsor individual refugees, requiring that they are based in the specific community where refugees will live. For example, a group of five or more Americans would be able to sponsor an individual.

All refugees admitted would be processed through the standard U.S. Refugee Admissions Program, with the Welcome Corps serving as an auxiliary support to help new refugees establish a new life.

The earliest refugees under the program are expected to arrive in April.

The program’s website indicated that refugees from several countries in Sub-Saharan Africa will be highest on the priority list.

The Welcome Corps requires Americans who sign up to commit to providing U.S.$2,275 per refugee arriving in the United States.

“It’s a dream [come true],” Nam Loc, who has worked with VOICE Canada and successfully helped bring about 170 Vietnamese to Canada since 2015.

He hoped that the new program would boost the number of people able to resettle in the United States.

Some asylum-seekers said that although the new program was a positive move, they did not have high expectations of its ability to help all refugees in need.

“As you know, the Biden administration promised to receive 125,000 refugees coming from many countries, but this program has not been implemented or has been done very slowly,” said religious freedom activist Nguyen Van Hoang, now a refugee in Thailand together with his wife and two children.

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Investments in WASH Can Help Nepal Reduce Climate Health Risks

In Nepal, dengue fever has spread at an alarming rate, with nationwide outbreaks experienced in 2019 and 2022. Findings of a study showed that the projected increase in temperatures due to climate change could result in higher cases of vector-borne diseases in the short term (2011–2040) and medium term (2041–2070).

The recent Intergovernmental Panel on Climate Change Sixth Assessment Report (IPCC-AR6) projected that vector-borne disease risks will increase under all levels of global warming in the absence of additional adaptation by countries. As climate change impacts temperatures and weather patterns across the globe, more regions are becoming suitable for vectors of disease, such as mosquitoes. Increased rainfall, for example, can create more pools of still water that are breeding grounds for vectors, while warmer temperatures can extend the transmission seasons of vector-borne diseases.

Improving water supply, sanitation, hygiene, and solid waste management (WASH) services can deliver known health benefits, such as lessening diarrhoeal disease and increasing hygiene practices, as well as help build resilience to vector-borne diseases. Investments in WASH have the potential to reduce such health risks. In Nepal, dengue and malaria can be brought down by 41% and 17% in urban areas, respectively.

Climate Change, Vector-Borne Diseases, and WASH

A study was conducted to explore the qualitative and quantitative relationships between vector-borne diseases, climate change, and WASH in Nepal. It sought to understand whether investments in WASH could potentially build resilience to these diseases and climate change. Quantitative relationships between climate variables and diseases were derived from a review of literature. These were combined with climate projections specific for the country.

Two different climate change scenarios were applied to estimate increases in four different vector-borne diseases in Nepal in the short term (2011–2040) and medium term (2041–2070). The first represented a “middle of the road” scenario (SSP2-4.5) that would lead to global temperature increases of approximately 2.1°C to 3.5°C by the end of the century. The second one (SSP5-8.5) represented a “fossil-fueled,” high-growth scenario with limited progress on mitigation that could lead to global temperature rises of around 3.3°C to 5.7°C by the end of the century.

Under all climate change projections, hospitalization due to visceral leishmaniasis (also known as kala-azar) and Japanese encephalitis would slightly increase. However, the increases would be high to very high for new cases of malaria and dengue fever.

In the short term (2011–2040), projected consequences of climate change were similar under the two scenarios, with malaria rising by 13% to 15% and dengue by 10% to 11%, following projected 0.5°C to 0.6°C increases in mean and maximum temperatures. In the medium term (2041–2070), mean and maximum temperatures would increase by 1.4°C under the first scenario and up to 1.9°C under the second scenario. This could raise the number of malaria cases by 35% to 48% and that of dengue fever by 26% to 36%.

Increases in minimum temperature were projected to have an even stronger impact on vector-borne diseases. Increases in minimum (night) temperatures can speed up larval development and extend the transmission season.

For malaria, the forecast higher minimum temperature of 0.9°C to 1.0°C in the short term (2011–2040) could push the number of new cases up by 23% to 27% in the next 20–25 years, unless the dedicated elimination program in Nepal reaches its target and eradicates malaria from the country by 2025.

For dengue, the projections were downright alarming. The current infection rate in Nepal is about 10 times as high as that of malaria. The country also experienced dengue fever outbreaks in 2019 and in 2022. Between September and December 2022, more than 50,000 dengue cases and over 60 deaths were recorded. In the short term (2011–2040), increases in minimum temperature by 0.9°C to 1.0°C might create 38% to 44% more dengue cases with a time lag effect of 2 months. This means that the increase in cases would happen 2 months after the minimum temperature has increased.

In the medium term (2041–2070), the minimum temperature was projected to increase by 1.8°C and 2.6°C under the “middle of the road” and “fossil-fueled” scenarios, respectively, with possibly 77% and 113% more lagged cases of dengue fever. The actual impact might be worse as these projections suggested gradual trends of average values only. The forecast excluded the devastating impact of outbreaks when thousands of people get infected and fall ill within a few months or even weeks.

Potential Impact of WASH Investments

Investments in WASH have the potential to reduce vector-borne diseases by improving the environment of impoverished homes and eliminating mosquito-breeding sites. Continuous water supply at the household level will eliminate the need for water storage, and effective household management of solid waste will reduce the number of containers that fill up with rainwater and become mosquito-breeding sites.

Better drinking water, sanitation, and waste management at the household level have the potential to reduce disease risk. Nepal’s efforts to reach the Sustainable Development Goals (SDGs) in water and sanitation and improve waste management can reduce malaria by 17% and dengue by 41% in urban areas. This is based on the quantitative relations between changes in WASH services and diseases as derived from various studies and subsequently applied to the country setting.

Implications

The Nepal National Adaptation Plan includes, among its priorities, improvements in water availability and quality, sustainability of sanitation and hygiene behaviours, and enhanced health benefits, such as reducing vector-borne diseases. Safe and reliable water supply—ideally continuous supply at the household level—drastically reduces the need for water storage, thereby removing important mosquito habitats.

The combined effect of the planned increase in water connections and solid waste management in households could reduce dengue cases by more than 40%. Meanwhile, malaria cases could be reduced by a sixth through improved water supply and sanitation. These reductions could largely compensate for the adverse effect of climate change in the short term. Other vector-borne diseases, as well as diarrhoeal diseases, might also be lessened.

WASH interventions have the potential to at least partially compensate for the negative impact of climate change on vector-borne diseases. The proposed Integrated Water Supply and Sewerage Management Project of the Government of Nepal and the Asian Development Bank aims to improve water supply, sanitation, and drainage systems in secondary and small towns. It would be supported by hygiene awareness and behavioural change campaigns. The successful implementation of this project could substantially reduce dengue fever, malaria, and other vector-borne diseases.

Source: Asian Development Bank

US Negotiators in Taiwan for New Talks on Trade Pact

A high-level delegation from the United States is in Taiwan this week to resume negotiations on a new trade initiative between Washington and the self-ruled island.

The delegation, led by Terry McCartin, the assistant trade representative for China in the U.S. Trade Representative’s office, arrived in Taipei last Friday to begin four days of talks over the U.S.-Taiwan 21st Century Trade Initiative. The initiative will cover 11 areas, including anti-corruption, agriculture, digital trade, environmental and labor practices.

The bilateral initiative was announced last June after the United States launched the Indo-Pacific Economic Framework, a new economic cooperation agreement with a dozen Asia-Pacific countries, including Australia, Japan, New Zealand, the Philippines, South Korea, Thailand and Vietnam. Taiwan was not invited to join the Indo-Pacific Economic Framework out of concerns from some nations that the self-governed island’s participation might anger China.

Beijing considers the democratically-ruled island part of its territory, even though it has been self-governing since the end of China’s civil war in 1949, when Chiang Kai-shek’s Nationalist forces were driven off the mainland by Mao Zedong’s Communists. China has vowed to bring the island under its control by any means necessary, including a military takeover.

Source: Voice of America

China’s 2022 growth seen as its lowest in 40 years

China’s economic growth for 2022 is expected to have been among its weakest in four decades after the twin crises of the pandemic and property woes, analysts said ahead of Tuesday’s GDP announcement.

Ten experts interviewed by AFP forecast an average 2.7 percent year-on-year rise in gross domestic product (GDP) for the world’s second-largest economy, a sharp plunge from China’s 2021 growth of more than 8 percent.

It could also be China’s slowest pace since a 1.6 contraction in 1976 — the year Mao Zedong died — and excluding 2020, after the Covid-19 virus emerged in Wuhan in late 2019.

Beijing had set itself a growth target of around 5.5 percent for 2022 but this was undermined by the government’s “zero-Covid” policy, which put the brakes on manufacturing activity and consumption.

Strict lockdowns, quarantines and compulsory mass testing prompted abrupt closures of manufacturing facilities and businesses in major hubs — like Zhengzhou, home of the world’s biggest iPhone factory — and sent reverberations across the global supply chain.

Beijing abruptly loosened pandemic restrictions in early December after three years of enforcing some of the harshest Covid measures in the world.

– ‘Growth is slowing’ –

China is battling a surge in Covid cases that has overwhelmed its hospitals and medical staff.

This is likely to reflect in 2022’s fourth-quarter growth, which will also be announced on Tuesday alongside a series of other indicators such as retail, industrial production and employment.

“The fourth quarter is relatively difficult,” said economist Zhang Ming of the Chinese Academy of Social Sciences in Beijing.

“No matter whether it’s by the metrics of consumption or investment, the growth is slowing.”

China’s exports took their biggest plunge since the start of the pandemic in December, contracting 9.9 percent year-on-year, while consumption was in the red in November and investment has slowed.

“The three horse carriages of the Chinese economy are all facing a relatively evident downward pressure in the fourth quarter,” Zhang said.

Rabobank analyst Teeuwe Mevissen echoed Zhang, saying the final quarter will “almost certainly show a decline because of the fast spread of Covid” after the loosening of health restrictions in December.

“This will affect both demand and supply conditions for the worse,” he said.

Problems in the property sector are also still weighing on growth, Mevissen said.

This sector, which along with construction accounts for more than a quarter of China’s GDP, has been suffering since Beijing started cracking down on excessive borrowing and rampant speculation in 2020.

This regulatory tightening marked the beginning of financial worries for Evergrande, the former Chinese number one in real estate that is now strangled by huge debt.

Real estate sales have since fallen in many cities and many developers are struggling to survive.

However, the government appears to be taking a more conciliatory approach to reviving this key sector.

Measures to promote “stable and healthy” development were announced in November, including credit support for indebted developers and assistance for deferred-payment loans for homebuyers.

– ‘Worst is over’ –

Some analysts took these measures as a reason for optimism.

“The transitional phase will likely be bumpy as the country may need to grapple with surging cases and increasingly stretched health systems,” warned analyst Jing Liu of HSBC, predicting a slowdown in the near term.

But, after three years of health restrictions, “China’s reopening process has started”, she said.

The World Bank forecast China’s GDP will rebound to 4.3 percent for 2023 — still below expectations.

Economist Larry Yang declared 2023 as “the year of returning to certainty”.

He said he expected growth to accelerate quarter by quarter in 2023, forecasting 5 percent GDP for the full year — a prediction in line with other analysts interviewed by AFP.

“The worst period of the economy itself has already passed,” Yang said.

Source: Thai Public Broadcasting Service

Thailand launches tourism promotion campaign to boost economy

Thailand’s tourism authority on Thursday announced an annual plan to boost its economy through elevated and experience-based tourism, Trend reports citing Xinhua.

Under the theme of “Amazing New Chapters,” the new campaign aims for a full resumption of Thai tourism this year, which is expected to generate about 2.38 trillion baht (about 71.12 billion U.S. dollars), or 80 percent of the pre-pandemic level, Tourism Authority of Thailand (TAT) Governor Yuthasak Supasorn told a news conference.

The beyond-goal achievement of tourism last year, with a total of 11.8 million foreign arrivals and 189 million domestic trips, reflected very positive signs for the tourism recovery, Yuthasak said.

For the Chinese and other international markets, the TAT will move forward by focusing on new segments of tourists, easing airline seat shortages, and promoting overland journeys, Deputy TAT Governor Tanes Petsuwan told the briefing.

The TAT will be working with airlines to help resume flights between Thailand and China as there are about 70 percent fewer flights compared to 2019, Tanes said.

“Aside from road connectivity in the north, the China-Laos railway is now a game changer, connecting China’s southern region to the northeastern part of Thailand,” he said.

According to the TAT, the Southeast Asian kingdom is expected to welcome around 25 million international arrivals this year, with 5 million of them being Chinese tourists.

Source: TREND News Agency

Thailand Launched Tourism Promotion Campaign To Boost Economy

BANGKOK, Thailand’s tourism authority, yesterday, announced an annual plan, to boost its economy through elevated and experience-based tourism.

Under the theme of “Amazing New Chapters,” the new campaign aims for a full resumption of Thai tourism this year, which is expected to generate about 2.38 trillion baht (about 71.12 billion U.S. dollars), or 80 percent of the pre-pandemic level, Tourism Authority of Thailand (TAT) Governor, Yuthasak Supasorn, told a news conference.

The achievement of tourism last year, with a total of 11.8 million foreign arrivals and 189 million domestic trips, reflected very positive signs for tourism recovery, Yuthasak said.

For the Chinese and other international markets, the TAT will move forward by focusing on new segments of tourists, easing airline seat shortages, and promoting overland journeys, Deputy TAT Governor, Tanes Petsuwan, told the briefing.

The TAT will be working with airlines to help resume flights between Thailand and China, as there are about 70 percent fewer flights compared to 2019, Tanes said.

“Aside from road connectivity in the north, the China-Laos railway is now a game changer, connecting China’s southern region to the north-eastern part of Thailand,” he said.

According to the TAT, the kingdom is expected to welcome around 25 million international arrivals this year, with five million of them being Chinese tourists.

Source: Nam News Network