Thailand to stop using IMF money

Thailand to stop using IMF money

BANGKOK (DPA): Thailand, with its economy heading towards three to four per cent growth this year and foreign exchange reserves up to US$32.2 billion, will stop withdrawing money from the International Monetary Fund (IMF), a news report said Sunday.

The decision is expected to announced in the finance ministry's eighth letter of intent to the IMF which will be submitted to the Thai Cabinet for approval on Tuesday, said The Nation newspaper, citing un-named government sources.

Thailand signed an IMF bailout package in August 1997 for US$17.2 billion, of which about $14 billion has already been disbursed.

The programme, which includes IMF directives on macro-economic management and economic restructuring, was originally scheduled to be completed in August 2000.

Early withdrawal from the lending portion of the programme has been made possible by better-than-expected growth this year, which is expected to reach three-four per cent compared to the original target of one per cent, said The Nation. Thailand's economy contracted by 9.4 per cent in 1998.

The kingdom's exports are expected to grow four per cent growth, compared to the government's original target of 3.5 per cent. Official foreign reserves at $32.2 billion are deemed "comfortable."

Although Thailand is expected to stop withdrawing IMF funds it will continue to follow the Fund's economic restructuring programme.

The finance ministry's eighth letter of intent to the IMF will emphasize efforts to speed up debt restructuring within Thailand's corporate sector to reduce the financial system's 2.7 trillion baht ($67.5 billion) in non-performing loans, said the news report.