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Here is your Mekong Memo Thailand for this week.
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Headlines:
Gold Shops Drafted into Currency Wars
Southern Floods Wash Away Q4 Growth
Scam Crackdown Nets $300 Million, Snares VIPs
Record FDI Applications Meet Tepid Reality
New Flight Routes Chase Carbon-Heavy Growth
Afternoon Alcohol Ban Falls After Half a Century
Dark Red Line Extension Needs Public Input
Gold Mine Settlement Arrives Before Elections
Charter Rewrite Fences Off Palace Provisions
SEA Games Run on Fumes and Free Tickets
Pickup Sales Slide, Recovery Pushed to 2026
Bangkok Post Editor Faces Reddit
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Gold Shops Drafted into Currency Wars
The baht is spiking and is now up 7% to 32 against the dollar, strangling exporters, and the Bank of Thailand’s solution is to deputize gold traders as informants. Starting next year, dealers above defined income thresholds will be required to report daily transactions so regulators can track the 10-20% correlation between gold prices and forex flows. The central bank also raised repatriation limits tenfold to $10 million on each transaction - a Band-Aid that will allow money to move faster without having to figure out why it happens to be flooding in. Markets are pricing a rate cut on December 17, which might actually move the needle. Separately, the Stock Exchange is going to be adopting FTSE Russell ESG criteria this year, chasing 900 billion baht in sustainable bonds and hoping that green labels will be able to bring in the capital that fundamentals haven’t.
Read more: Reuters (Baht Strategy), Bangkok Post (Gold Reporting), Nation Thailand (ESG Investment)
Southern Floods Wash Away Q4 Growth
November’s floods killed at least 145 people, displaced nearly four million, and erased between $1.2 billion and $15.6 billion in economic value - the range itself is an indication of the level of the chaos. Hat Yai took 335mm of rain in a single day, turning streets into rivers and Q4 projections into wreckage. Tourism losses alone hit $220-700 million, and fourth-quarter GDP growth is now expected to come in below 1%, a figure that’s down from the 1.2% Q3 number. The disaster exposed what optimism has so far papered over - drainage systems built for different weather, infrastructure that can’t handle what the climate now delivers, and an economy where a single bad month is able to wash away a full quarter’s gains.
Read more: ABC News (Death Toll), Nation Thailand (Budget Impact), Guardian (Regional Context)
Scam Crackdown Nets $300 Million, Snares VIPs
Authorities took possession of $300 million in assets and issued 42 arrest warrants in a sweeping crackdown on cyber-scam networks, including raids on seven bitcoin mining operations that are allegedly linked to Chinese fraudsters. The haul is impressive. Less impressive are photographs surfacing of PM Paetongtarn Shinawatra, Finance Minister Pichai Chunhavajira, and Deputy PM Anutin Charnvirakul, all posing together with alleged scam kingpin “Ben Smith.” All three scrambled to explain the images as routine political meet-and-greets, with Anutin insisting he takes photos with thousands of people. The SEC is now looking more carefully at listed companies for money laundering ties, suggesting the crackdown’s reach is now going well beyond the border casinos.
Read more: The Diplomat (Asset Seizure), Bangkok Post (Photo Controversy), Bangkok Post (Laundering Probe)
Record FDI Applications Meet Tepid Reality
Foreign investment applications came in at $42.2 billion through November, a figure that’s almost double last year’s take, with Singapore, China, and Japan financing digital infrastructure, electronics, and EVs. The Ministry is thrilled, but applications aren’t projects, and projects aren’t jobs. SET-listed companies are reporting a curious split, saying that sales are down 6%, but profits are up 21%. The heady profits are mostly thanks to one-off gains and accounting adjustments, not, unfortunately, on the back of operational strengths. Finance Minister Ekniti Nitithanprapas wants the fiscal deficit to get below 3% by 2029 and says that he promises to expedite 80 stalled projects to help the nation get there. Whether any of this translates into broad-based growth that pays wages and fills storefronts is still the gap between announcement and reality. Let’s see.
Read more: AMRO Blog (FDI Analysis), Bangkok Post (Earnings), Kasikorn Research (Fiscal Outlook)
New Flight Routes Chase Carbon-Heavy Growth
Three Japan-Thailand flight routes were introduced in early December, with Thai AirAsia X and Thai Lion Air adding Sendai, Hokkaido, and Osaka services. Air Arabia is now flying from Sharjah to Krabi. The expansions are resulting in more metal in the sky, and more tourists on the ground; hopefully, it means more revenue in the till. The country is chasing more than a million Japanese visitors by year’s end, up from 985,612 through November. What’s less clear is how this squares with climate commitments, given aviation remains one of the hardest sectors to decarbonize. EGAT, for its part, is pouring funds into clean energy, and the government showed off a new gas pricing framework that will help with its green transition work.
Read more: TAT Newsroom (Japan Routes), Bangkok Post (Clean Energy), Bangkok Post (Energy Pricing)
Afternoon Alcohol Ban Falls After Half a Century
The 2-5 PM alcohol prohibition is dead. New rules will allow sales from 11 AM to midnight and on-premises consumption until 1 AM at licensed shops - a 180-day trial that conveniently captures Christmas, New Year, and Songkran. The timing is tactical because of the upcoming peak season, and means maximum tourist dollars, minimum political risk. Public Health Minister Pattana Promphat signed off on the change on Tuesday, ending a regime that carried fines up to 10,000 baht for scofflaws. Whether liberalization becomes permanent depends on what happens when the heaviest traffic from international visitors - 29 million arrivals through November - meets extended drinking hours. Six months will tell if progress will be sustained, or if prohibition will make a return.
Read more: BBC (Historical Context), AP News (Legal Details), CNN (Tourism Impact)
Dark Red Line Extension Needs Public Input
The State Railway is asking which route the public prefers for the Dark Red Line extension to Maha Chai. Five options, all running 35-37 kilometers, are being weighed. Chief engineer Atthapol Kaoprasert expects cabinet approval to come by 2027, and expects construction to begin in 2028, but that’s an optimistic view. The Senate is scrutinizing Bangkok Expressway and Metro’s request for 22 more years on its concession. The workers’ union is fighting it. Transport Minister Phiphat Ratchakitprakarn says he’s negotiating lower tolls from 90 baht down to something commuters are better able to stomach.
Read more: Bangkok Post (Railway Extension), Bangkok Post (Expressway Scrutiny)
Gold Mine Settlement Arrives Before Elections
A seven-year fight with Kingsgate over the Chatree mine just ended in a settlement. The Australian company was able to get 1.8 million ounces of gold out of the ground before health complaints shut operations in 2017. The timing of the settlement is conspicuous as elections are imminent and the opposition People’s Party is polling for 150-200 seats while ruling Bhumjaithai is scrambling to collect between 130 and 150. Reopening a controversial mine right before voters make their choice isn’t a coincidence; it’s a calculated move as the government needs rural provinces like Phichit, Phitsanulok, and Phetchabun, where Chatree once employed thousands and where memories of jobs may outlast memories of illness. Whether pickaxes will be able to pick up more votes than they lose will give us an indication of whether economic pragmatism is stronger than environmental anxiety.
Read more: Bangkok Post (Settlement), Bangkok Post (Election Dynamics)
Charter Rewrite Fences Off Palace Provisions
Two committees, 70 people, 360 days to draft a new constitution. The House Speaker announced the framework this week, and we know what won’t change: Chapter 2, provisions surrounding the monarchy. That’s the fence. Everything else is negotiable, but not the palace. The timing carries some irony as Thailand just became the first country to merge UN torture and disappearance conventions into domestic law by way of the 2023 Prevention and Suppression Act. Expanding rights protections while hardening protections around the institution most entangled with lèse-majesté prosecutions is a great example of the contradiction baked into the reform cycle. The committees have a year. Whether they produce anything the military and palace will tolerate is the story to watch.
Read more: Bangkok Post (Constitution Drafting), Bangkok Post (Torture Law)
SEA Games Run on Fumes and Free Tickets
The 2025 SEA Games kicked off with missing national anthems in a technical failure that captures the budget squeeze. At 2 billion baht, Thailand is spending a third less than Cambodia managed in 2023, even after an emergency 160 million baht got added on at the last minute when organizers relocated from flood-hit Hat Yai to Bangkok and Chon Buri. The math isn’t mathing so well. The games are host to 50 sports, will deliver 574 gold medals, in venues split between Rajamangala Stadium and Chonburi, all delivered on discount infrastructure. Free tickets sound generous until you understand they’re also a hedge against embarrassingly empty stands. Cambodia set a (not “the”) standard. This edition will let us know if ambition is going to be able to survive austerity.
Read more: Thai Enquirer (Budget Critique), Nation Thailand (Preparation Issues)
Pickup Sales Slide, Recovery Pushed to 2026
Toyota’s president said what everyone knew, but nobody wanted to hear: pickup sales are down 14.6%, and the 900,000 workers whose livelihoods depend on them shouldn’t expect recovery until late next year. Political instability is getting the blame, but when 90% of a supplier base feeds one vehicle type and that type isn’t selling, the whole structure comes under pressure, obviously. Japanese automakers promised that they’d keep production capacity up anyway, and Hyundai is beefing up its BEV presence, and BYD celebrated producing 70,000 cars at its local plant. The pickup kingdom is being forced to diversify whether it wants to or not.
Read more: Bangkok Post (Production), Car News China (BYD Milestone), Bangkok Post (BEV Expansion)
Bangkok Post Editor Faces Reddit
The Bangkok Post’s editor took questions from Reddit this week, acknowledging that Thai media operate under criminal defamation and lèse-majesté laws but also keen to let the world know that the paper practices less self-censorship than regional peers. The paper says that it is actively lobbying to change those laws. In a media landscape where candor carries legal risk, an editor voluntarily stepping into an anonymous forum to discuss press freedom is either brave or foolish, and possibly both. The thread is worth reading for anyone curious about how journalism in Thailand navigates the minefield.
Read more: Bangkok Post (Overview), Reddit (AMA)
That’s it for this week, thanks for reading!
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