Baht borrowing now preferred to dollar debt
Private companies are increasingly borrowing through foreign baht-denominated debts, while dollar-denominated debts have declined gradually, according to a Bank of Thailand survey.
Private non-bank external debt in baht was recorded at US$9.2 billion (Bt346 billion) as of June, jumping 35.8 per cent over the year. As a result, it accounted for 33.9 per cent of total debts, compared with 29 per cent in June last year. US-dollar-denominated debts were $12.8 billion, rising 10.8 per cent on year. This accounted for 47.4 per cent of total foreign debt, declining from 49.6 per cent in the same period of last year. Baht-denominated foreign debts have increased significantly because multilateral companies in Thailand are increasingly borrow in baht from their parent companies, according to the BOT's report. Dollar-denominated debt has risen slower than the growth of overall external debt, which increased by 16 per cent to $27.1 billion as of June. In 2000 the ratio of the dollar and baht foreign debt was 76.2:7.9. Baht debt ranked third for a long time before gaining second place for the first time in 2001. Baht debts have increased significantly despite relatively high baht interest rates compared to other currencies. The average interest rate of baht debts was 5.77 per cent, compared with the average of all interest rates of 4.88 per cent. The United States remains the largest source of credit for companies in Thailand, accounting for 24.1 per cent of total debts but down from 25.9 per cent last June. Singaporean creditors ranked second, accounting for 18.5 per cent, compared with 13.5 per cent last June. Japan held the third rank, accounting for 15.1 per cent, followed by 10.5 per cent for Hong Kong and 6.7 per cent for Germany. In terms of maturity, short-term debts were recorded at $5.7 billion, or 21 per cent of total debt, while long-term debts were $21.4 billion. The ratio of short-term debt to total debt has been stable since 2005 after jumping from 12 to 17 per cent between 2000 and 2004. As of June, short-term debts rose by 15.2 per cent over the year, slightly lower than the 16.2-per-cent growth of long-term debts. The current survey was conducted on 3,362 companies from July 3-September 20.
Anoma Srisukkasem The Nation
|
