Cablegate: Thai Econ Announcements Unlikely to Affect

VZCZCXRO9736
PP RUEHCHI RUEHDT RUEHHM RUEHNH
DE RUEHGP #3827 3541010
ZNR UUUUU ZZH
P 201010Z DEC 06
FM AMEMBASSY SINGAPORE
TO RUEHC/SECSTATE WASHDC PRIORITY 2089
INFO RUCNASE/ASEAN MEMBER COLLECTIVE PRIORITY
RUEHBK/AMEMBASSY BANGKOK PRIORITY 7028
RUEHBJ/AMEMBASSY BEIJING PRIORITY 2375
RUEHBY/AMEMBASSY CANBERRA PRIORITY 1797
RUEHUL/AMEMBASSY SEOUL PRIORITY 3995
RUEHKO/AMEMBASSY TOKYO PRIORITY 5536
RUEHHK/AMCONSUL HONG KONG PRIORITY 6127
RUEATRS/DEPT OF TREASURY WASHDC PRIORITY
RUCPDOC/DEPT OF COMMERCE WASHDC PRIORITY

UNCLAS SINGAPORE 003827

SIPDIS

SENSITIVE
SIPDIS

E.O. 12958: N/A
TAGS: ECON EFIN SN
SUBJECT: THAI ECON ANNOUNCEMENTS UNLIKELY TO AFFECT
SINGAPORE IN THE LONG TERM

REF: BANGKOK 7435

The Straits Times Index on December 20 gained .8 percent
after losing 2.2 percent yesterday in reaction to the Bank of
Thailand's (BOT) sudden decision to impose capital control
measures on foreign investors (reftel). Embassy contacts
concurred with media pundits that the quick rebound here was
largely due to an equity exemption announced late yesterday
by the BOT. A Deutsche Bank researcher told us that the
moves showed a lack of foresight by the BOT, but he did not
believe they would negatively affect Singapore in the long
term. He opined that yesterday's decisions mainly served to
call into question the competence of Thailand's Finance
Minister. A Senior Economist from the Monetary Authority of
Singapore told us the repercussions here would likely be
"minimal" and "confined." She predicted that in six months
no one in Singapore would remember this as a major event. We
will continue to monitor the situation closely.
HERBOLD

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