Thailand, China expected to increase currencies swap agreement

BANGKOK, December 25 (TNA) - Thailand and China are expected to increase the volume of their currencies swap agreement in future in line with rising bilateral trade and investment, China’s economic growth and on the launching of ASEAN Economic Community in 2015, said Suchada Kirakul, deputy governor of the Bank of Thailand (BoT). Suchada said there are positive signs that both the amount of currencies swap agreement and the maturity date could be expanded by Thailand and China in future due to rising trade and investment of the two nations. Under the recent bilateral currencies swap agreement signed between BoT governor Prasarn Trairatvorakul and Hu Xiaolian, deputy governor of the People’s Bank of China, the two countries would swap, 70 billion yuan or about 320 billion baht with the maturity of three years with an aim to promote bilateral trade and investment. Currently, Thai baht and yuan transaction accounts about one per cent out of total trade value, or equivalent to approximately 450-500 million US dollars, and trade value is expected to increase in future following an agreement between Prime Minister Yingluck Shinawatra and China’s Vice President Xi Jinping to increase bilateral trade during a five-year period, starting from 2012, up to 20 per cent yearly with tourism growth also at 20 per cent and investment to 15 per cent yearly. The Chinese vice president arrived in Bangkok on Thursday on a three-day official visit. Suchada said the swap agreement between baht and yuan on bilateral trade could lessen dependency on the greenback especially during a high volatility and it should give a good opportunity to investors. Thailand is also prepared to swap its currency with other currencies to cater to expected rising trade and investment in future during an upcoming Executives’ Meeting of East Asia and Pacific Central Banks (EMEAP). EMEAP members are South Korea, China, Japan, Indonesia, Malaysia, the Philippines, Singapore, Hong Kong, Australia, New Zealand and Thailand. (TNA)