Thaksin’s Daughter Criticizes Central Bank Independence as a Barrier

The ongoing dispute between Thailand’s Prime Minister Srettha Thavisin and the central bank over interest rates has taken a new turn with the politician daughter of former premier Thaksin Shinawatra weighing in on the matter.

Paetongtarn Shinawatra, leader of the ruling Pheu Thai party, criticized the central bank’s independence, calling it an “obstacle” in resolving economic problems. She expressed concern that the Bank of Thailand’s refusal to lower interest rates was hampering efforts to stimulate the economy, which she believes is in crisis.

Prime Minister Srettha has been pressuring the central bank to cut rates, arguing that the current rate of 2.50% is hurting small businesses and hindering government efforts to boost economic growth. However, the central bank has maintained its independence and refused to bow to political pressure.

The governor of the Bank of Thailand defended the bank’s stance, stating that the current interest rate is appropriate for the economy and that a rate cut could have unintended consequences in the long run.

Paetongtarn’s comments carry weight in Thailand, given her family’s political influence. Her father, Thaksin Shinawatra, is a billionaire figurehead who has dominated Thai politics for decades. Thaksin himself has faced legal troubles, including a jail sentence for conflicts of interest and abuse of power, but he maintains that he has retired from politics.

The ongoing disagreement between the government and the central bank highlights the challenges of balancing economic policy with institutional independence in Thailand.