Investment up in May, baht fluctuates

Investment up in May, baht fluctuates

A total of 200 investment applications with a combined worth of 82.5 billion baht were submitted to the Board of Investment (BoI) for investment privileges in May, the government's investment promotion agency reported on Tuesday.

The number of applications in May increased over the same month last year by 64.5 per cent and the value by 54.4 per cent, the BoI said.

The applications over the first five months of the year (Jan-May) totalled 817, an increase of 20.9 per cent from the same period last year. The combined investment cost was up 87.5 per cent to 374.9 billion baht, from 200 billion reported last year.

The most favoured investments in May were in chemicals, paper and plastic, with 109 applications and a total investment of 105.5 billion baht, said BoI.

The service and public health industry was next, with 207 applications with a combined investment cost of 87.4 billion baht, followed by metal products, machinery and transportation equipment, with 190 applications and 64 billion baht investment cost.

There were 69 applications worth more than one billion baht, with a total investment cost of 250 billion baht, the BoI said.

The eastern province of Rayong was the most favoured investment locale, with 104 applications and a total investment cost of 115.5 billion baht, followed by Chonburi, Ayutthaya, Samut Songkram and Ratchaburi.

Photo by Pattarachai Preechapanich

Despite such good news on foreign direct investment, the value of Thai baht fluctuated heavily on Tuesday, attributed to rapid short-term foreign capital inflow and outflow.

Singchai Bunyayothin, senior director of the money market division at the Bank of Thailand, said the baht's value moved up and down by 40 satang to 50 satang to one US dollar on Tuesday.

He attributed the currency's fluctuation to short-term foreign capital flows, caused mainly by overseas negative factors particularly the unsettled debt crisis in Europe.

The situation was not worrying because the baht had not varied too much compared to other currencies in the region. The central bank will keep a close watch on the baht value, Mr Singchai said.

He said the decision by countries in the European Union to provide financial assistance of 100 billion euros to Spain would help restore the confidence of various international banks. It would also restore confidence among investors in global money markets.

The baht fluctuated by only four per cent, less than the currencies of Malaysia, South Korea and Taiwan. The Thai currency was late today moving between 31.53-31.60 baht per dollar, with a potential to further weaken, he added.

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