Chalongphob Sussangkarn, appointed in March after his predecessor Pridiyathorn Devakula resigned suddenly, told "the Financial Times" that Thailand had experienced "a great deal of chaos" since the coup last September.

 "We have to do what we can to stimulate the economy. But with all the political uncertainty, it's not going to lead to a big spurt in economic growth," he told the newspaper.

 The economy has suffered a number of blows since the military overthrew businessman-turned-premier Thaksin Shinawatra, most notably when new capital control measures sent the stock market plummet 15 per cent in December.

 The new finance team also shook investors when it announced it was tightening foreign ownership laws while bombs in Bangkok on December 31 and recent street protests against the junta have added to the uncertainty.

 The junta which overthrew Thaksin has promised elections by the end of the year but it is still not clear who will run in these polls or if Thaksin will be allowed to return to the country for them.

 "People are still wondering what will happen after this government leaves office and who is going to be in the political picture," said Chalongphob, a former World Bank economist.

 "What will be the role of (Thaksin's) Thai Rak Thai party, or the role of Thaksin? ... It's therefore not surprising that confidence is low," he told the Financial Times.

 The Bank of Thailand in January revised down its growth forecast for 2007 by 0.5 per centage points to a 4.0-5.0 per cent range and last week slashed interest rates by half-a-point to 4.0 per cent to stimulate the sagging economy.

 Bank of Thailand governor Tarisa Watanagase meanwhile told The Wall Street Journal Monday the central bank would continue to lower interest rates to boost the economy.

 "Monetary policy will be accommodative going forward, so there will be further cuts," she said in an interview with the newspaper.

 "Given that inflation risks are small and, on the other hand, risks to growth have increased, (the bank) has more reasons to use monetary policy to take care of the growth issue," she added.

 She said that the central bank would likely further lower its growth forecasts in a report on April 24 but added that any revisions would not be substantial.

Agence France Presse