"Exports next year will face difficulty in achieving the target because of the baht's appreciation," he said. "However, the government will try to boost exports to achieve the goal and economic growth."

Industry Minister Kosit Panpiemras, meanwhile, said the baht's appreciation was negatively affecting the industrial sector.

Business operators, and particularly small- and medium-sized enterprises (SMEs), have found it difficult to adapt. He suggested that they should boost the quality of their products and avoid competing in markets where they are disadvantaged.

Both the public and private sectors must help to strengthen the country's industries by creating sustainable growth, decreasing debts and boosting operators' competitiveness, he said.

Kosit said the rising strength of the baht was not a normal phenomenon and it had started to affect a number of industrial sectors.

However, he believes the Bank of Thailand will be able to handle the situation because it is equipped with all the necessary information.

The baht closed at 35.33 to 35.36 to the dollar yesterday, compared to Friday's 35.25 to 35.27, and finished at 46.25 to 46.33 to the euro, easing from 46.25 to 46.30. The Thai currency hit a new nine-year high during morning trade, reaching 35.12 to the dollar, while the Japanese yen and Singapore dollar fell against the greenback.

Krirk-krai said that to drive exports and boost economic growth, provincial governors should strengthen the economy in each community and attract foreign direct investment.

He instructed provincial governors to improve their communities by focusing on four main tenets: trading nation, service provider, rising competitiveness and promoting Thailand as an investment country.

The four principles will be guidelines for each province to modify itself to prepare for the economic environment of globalisation, Krirk-krai said.

While assigning his ministry's policies to 75 provincial governors in Bangkok yesterday, Krirk-krai put forward his vision that each province should be more independent and self-reliant.

Each province should be able to depend on its own income and develop internal economies in accordance with demand in each community, he said.

"More decentralisation of administration should be applied to communities. Businesses in each province should also be promoted as clusters, to develop their operations and increase the advantages of competitiveness with other countries," he said, adding that agriculture was the first sector that should be so developed.

Krirk-krai said the Commerce Ministry would promote more border trading to increase exports and promote Thailand as a centre for trading in the Asean region.

Primarily, it will promote border trade with Laos through nine border provinces: Chiang Rai, Phayao, Nan, Nong Khai, Uttaradit, Nakhon Phanom, Mukdahan, Amnat Charoen, Phitsanulok and Ubon Ratchathani.

Krirk-krai will visit Laos to tighten cooperation between the two countries next week.

Commerce Ministry permanent secretary Karun Kittisataporn said the government had recently reorganised Commerce Ministry offices at provincial level to become a one-stop service, including the offices of the Business Development Department, the Insurance Department and the Internal Trade Department.

Karun said the cooperation will create a more effective operation.

Petchanet Pratruangkrai

The Nation