Deputy PM's supervision of Thai finance minister hailed

Deputy PM's supervision of Thai finance minister hailed

By Thomas Fox

BANGKOK (AFP): A decision by Prime Minister Banharn Silpa-
archa to place Thailand's embattled finance minister under the
supervision of another senior cabinet member was welcomed by
financial analysts Thursday.

Amnuay Virawan, a deputy premier charged with international
economic affairs, was appointed Wednesday to supervise the
finance ministry, a move that analysts said would improve
coordination among economic ministries.

It would also reduce the risk of political meddling, they
said.

"I think it was the right decision," said Nimit
Nontapunthawat, head of research for Bangkok Bank. "Dr. Amnuay
has a lot of experience with the finance ministry, and his
education and experience in the private sector is also very much
related."

The move would give Amnuay authority over Finance Minister
Surakiart Sathirathai, who has been criticized for his lack of
expertise in finance since his appointment to the cabinet in
July. His background is in international law.

Investors criticized Surakiart's performance during the first
few months of his term, mainly because of a fall in share prices
on the stock market, which the minister said was due to factors
beyond his control.

Surakiart then upset analysts by setting up a 20 billion baht
(800-million-dollar) bail-out fund, so that margin investors
would not suffer from forced sales during the slump.

But the situation came to a head last month when Surakiart
pressured Ekamol Kiriwat into resigning as head of the Securities
and Exchange Commission (SEC) and led a campaign to have the
cabinet fire Ekamol from his post at the central bank post.

Critics, who fear that the central Bank of Thailand is
becoming politicized, attacked Surakiart for not providing any
evidence against Ekamol.

Ekamol has been widely credited for building the watchdog SEC
into what foreign analysts have said was a world-class
institution.

"The sacking of Ekamol could very likely be the reason that
prompted moving Amnuay to (supervise) the finance ministry," said
the head of another market research center, who asked not to be
identified.

"People need to be made aware why a high official at that
level is sacked without any adequate explanation or evidence,"
the Thai analyst said.

"It appears to me that there is quarreling among the
technocrats. I view it very negatively because who should I trust
now? Which technocrats do I listen to now?" the analyst said.

The deputy prime minister may have been chosen as a neutral
person to oversee the squabbling between two groups in his old
ministry, he added.

Ekamol's replacement at the SEC, Pakorn Malakul Na Ayudhya,
also threw his support behind the decision to put Amnuay in
charge.

"It will be good for the country, as Amnuay is a respected
economist and financier," he said at a press conference Thursday.
Bangkok Bank's Nimit said he did not believe that Surakiart would
lose his job in the cabinet reshuffle expected to take place in
the near future.

"With Dr. Amnuay in charge of the finance ministry it would
create greater confidence because you have an experienced man
there as well as Dr. Surakiart, who is well educated and capable
but may lack experience," he said.

The Stock Exchange of Thailand index jumped 3.3 percent on
Wednesday, the first trading day of the new year when Amnuay's
new duties were announced, and had risen another 3.6 percent at
midday Thursday.

However, brokers said the increase had little to do with
Amnuay's appointment.

"Given the strong liquidity flowing into all Asian markets,
the question of foreign confidence in Amnuay being given
supervision of the finance ministry is not even a consideration
for the short term," a foreign analyst said.