Thailand has restarted a process delayed for several months to select a new chairman for the nation’s central bank after a previous attempt to appoint a former minister to the post failed due to his political links.
The Finance Ministry has nominated former permanent secretary for finance Somchai Sujjapongse, as its new candidate, Isra News Agency reported on Thursday. He will vie for the job with academic Surapon Nitikraipot, who was proposed by the Bank of Thailand, the news agency reported, citing unidentified sources at the central bank and the ministry.
The appointment of a BoT chairman — who is not involved in monetary policy meetings — was delayed after opposition mounted against the ministry’s move last year to nominate Kittiratt Na-Ranong. The former finance minister, who had close ties with the ruling Pheu Thai Party, was deemed as unfit to hold the job by the government’s legal council.
While the BoT chairman doesn’t decide on policy, the official has a say in who joins the Monetary Policy Committee and can assess the performance of the governor.
The government has been advocating rate cuts to boost the sluggish economy and exploring ways to wield greater influence over the BoT. Prime Minister Paetongtarn Shinawatra’s administration may push for a candidate who’s more receptive to its demands. Incumbent Sethaput Suthiwartnarueput is set to complete his term in September.
Ms Paetongtarn hasn’t commented about monetary policy since taking office in September, but she once described the BoT’s autonomy as “an obstacle” to government efforts to boost the economy. Her administration has passed a bigger budget and handed out billions of dollars in cash to vulnerable groups to ease living costs, while trying to build political support among voters.
Supavud Saicheua, an adviser to Ms Paetongtarn, on Tuesday reiterated the government’s calls to slash rates to support the economy, citing growing headwinds to growth from risks to global trade, low inflation and negative loan growth. Having the benchmark interest rate at 2.25% is not accommodative, he said.
The BoT, which kept the policy rate steady at 2.25% in December after a surprise quarter-point cut in October, is scheduled to review the rate on Feb 26.