Strong baht hits national economy



(KPL) The strong baht of Thai currency kicks start to hit local exported companies and national economy despite of being weak kip currency compares to Thai baht.


Since 2006 national currency has been stability and the inflation rate was low level by averaging year-round stood at 6.8 percent. The currency exchange was also stability.


The kip currency is also strong compares it to US dollar which stood at 10.4 percent and baht about 2.73 percent. But recently the kip is weaker rapidly compare to baht.


This matter has hit considerably national economic system but there have been positive and negative impacts, said Mr. Phouphet Khamphounvong, Governor of Bank of Lao PDR at a press conference on the current fluctuation of kip currency is against US dollar, baht and an addressing measure.


The strong baht was severely effects to imported entrepreneurs because majority of Lao entrepreneurs has imported goods and raw materials from Thailand or even other services from Thailand causing increase their expenditure for import and increase capital, he continued.


In contrast the export of Laos would gain a great advantage when foreign currency gaining from exported goods have been exchanged into kip currency it would be added value, he explained.


Therefore, the Lao companies running for export should create more opportunities to export products to Thailand so as to create trade balance, he advised.


Some industrial sectors such as garment factories depended on importing raw materials from Thailand has been impacted considerably due to increased the capital of production.


Mr. Onesy Boutsivongsack, Chairman of Lao Industrial Garment Association who is also Deputy Chairman of National Council for Industry and Trade said that the garment factories are being impacted if this condition went on for a long time the capital of production would be impacted directly.

Meanwhile the transactions have been paid by US dollar but the kip currency is strong this would impact to the capital of production and income of the companies.

Source: kpl.net.la