In a landmark lesson on Thailand at this year’s joint meeting of the Association of Thai Travel Agents and the Thai Hotels Association on 5 February, Professor Dr. Piti Srisangnam, head of the ASEAN Foundation, cited” De- Dollarisation” as one of “6D” changes that will shake up Go &, Tourism, the other five being Decoupling / DeRisking of the global value chains, Deglobalization, Destabilization, the Digital Divide and Degradation of Environment.
de- Dollarisation
The lesson is set to update the information of business discourse, in Thailand and beyond. For the first time, two leading Thai vacation &, hospitality industry associations invited a professor to examine the impact of political conflicts on their businesses, jettisoning the repeatedly dull talks on post- COVID recovery, sustainability, and technology.
In a eloquently argued presentation, Dr Piti challenged many of the sun-drenched- side- up positions presented by business speakers at business forums. Between the lines, he highlighted the difficult part of the United States in all the 6Ds, from wars and fight to currency fluctuation, business wars, technological disruption, and environmental degradation.
Who is Dr. Piti Srisangnam?
Dr. Piti Srisangnam holds a Ph. D. degree in Economics and Commerce from the University of Melbourne ( Australia ), and an M. A. degree inInternational Economics and Finance from Chulalongkorn University ( Thailand ). He has been teaching International Economics and ASEAN Studies for bachelor’s and master’s degree pupils at Chulalongkorn University since 2002.
He has been Deputy Director for Academic Affairs of the Centre for Western Reports from 2010 to 2012 and Deputy Director for Academic Affairs of the ASEAN Studies Center in 2012, both at Chulalongkorn University, before he became Director of the ASEAN Studies Center in 2013.
He has been selected for the 2019 Rising Star Royal Thai Government Scholarships Association Award: Rising Star. In 2021, he was granted the Dongfang Scholarship to become a visiting professor at Peking University for one quarter.
He has published some papers in journals and books electronic. g. on the socioeconomic development in Southeast Asia, on trade in services among ASEAN Member States, on the regional economic integration of ASEAN and of the European Union, on the financial reform and SME development in Thailand, on ASEAN- India, ASEAN- China and ASEAN- Japan and ASEAN- South relations.
Aside from scientific work, he likewise hosts 4 television plans related to present issues in ASEAN.
Of all the 6Ds, his most extensive views were on De- Dollarisation, which immediately impacts the lower outlines of every business.
Thailand faces a 1.6 billion Money hospitality
50 % of China’s business no longer uses the U. S. money
Prof Piti outlined numerous reasons why countries and companies were shifting away from the US dollars. More than 50 % of China’s international business no longer uses the US dollars. Due to “irresponsible US Monetary and Fiscal policies,” China has also reduced its assets of US Treasury Bonds from over$ 1.3 trillion to$ 700 billion.
He used the US’s implementation of Quantitative Easing ( QE ) measures to recover from the Sub-Prime Economic Crisis ( 2006–2009 ), Global Financial Crisis ( 192009–2012 ), and Covid Crisis ( 202020–2022 ), all of which involved injecting US$ 9.4 trillion into the system. Cash flowed out of the US to, among other nations, Thailand at a time when interest rates in America were extremely small. Thai tourism and exports were impacted as a result of the strengthened ringgit.
The QE laws caused prices, which had an effect on the US as well. Higher interest rates resulted from this. Interest rates increased 11 days from 0.25 percent to 5.5 % between 2022 and the start of 2023. The Thai ringgit next depreciated as large amounts of money started to return to America.
Why depend on the US?
Therefore, some countries are starting to consider why they must rely on America as a result of managing money fluctuations like this.
Dr. Piti cited another instance of “irresponsible US fiscal policy” in which he pointed out that despite having a GDP of$ 26 trillion, the US government alone owes between$ 35 and 36 trillion. The US spends$ 1 trillion per month just paying off the debt.
American Credit Game
These are the activities that the United States is engaged in. It is comparable to using your initial credit card to make a purchase. Apply a second credit card to settle the debt from the first one once the credit limit has been reached. Ask Congress to increase the cap on second credit cards so that the first and second credit card bills can be paid off when the next card is fully loaded. This may later be brought up in bankruptcy court.
The question is whether the US will always declare bankruptcy, he said now. Because people uses the US dollar, people in the past did not think that America would reach that point. However, China, the largest manufacturer and economy in the world, has now reduced its use of the buck in half.
He claimed that once-dominant economies were those of nations like the Netherlands and the British. ” Is somebody currently trading with these assets? Answer: There are n’t many. Therefore, he stated, the question is never whether it will occur, but rather when.
When does America declare bankruptcy?
He explicitly warned the tour companies and hotels that they could accidentally run short of US anti-money laundering and anti terrorism laws, refuting the assertion that the US dollar is regarded as an” safe haven money.”
He claimed that after 2001, the US changed its Currency Act to permit the money to be used to exercise extralegal privileges.
He asserted that while there is no issue if two nations are using their economies for trade,” America has the right to assault us” when the US dollar is used for any trade with a nation that may be subject to sanctions, such as Iran.
Because of this, Yuan is always used for accounting when China exports items to Iran.
He thought back to the incident involving Huawei’s CFO, the owner of the business ‘ daughter, who was detained while traveling with Canada as a result of just one example of Huawei using US dollars for business. Ultimately, there was no evidence against her, and she was let go.
He enquired as to whether the tour operators and hotels had ever read the fine print on the charter types for foreign exchange that must be used when sending or receiving foreign currency from abroad. The transacting banks must submit these statements to the Bank of Thailand ( Central Bank ) for submission.
Have you ever read the charter document’s specifics? Dr. Piti enquired. It does contain some things that the Bank of Thailand does not issue. They come from the Federal Reserve.
What connection does the Federal Reserve have to businesses in Thailand?
Some nations do not want to apply the US dollar because of this.
Because the US is having an election time, he predicts that there will be more economical issues this season. This will necessitate additional stimulus steps from the US government, which will only increase loan. The same circumstance of low interest rates, higher debts, inflow-outflow of money, inflation, and currency fluctuations that he previously cited will only be repeated in that case.
Risks of Exchange Rate
What safeguards will we need to avoid exchange rate challenges, then? One point is if your company does not perform well as a result of poor sales. However, losing funds due to changes in exchange rates is painful.
Dr. Piti discussed De-Stabilization and how the conflict in Ukraine has affected commerce as well as food and energy protection.
Russians, for instance, no longer travel to Europe.
Russians and Ukrainians are both visiting Thailand.
While this is great, many people are even investing in distressed properties like little, two- or three-star lodgings that went penniless during Covid. This will result in increased contest for Thai-owned components in the future.
The position in the Middle East
Depending on whether Iran gets immediately involved, he predicted that the Middle East situation is likely to worsen.
Situations in Myanmar and South China
Disagreements closer to home, like those in Myanmar and the South China Sea, will also have an impact on Thailand.
All of these issues are interconnected in some way and will have an effect on other sectors, including oil, mining, strength, and travel andamp; tourism will also be impacted.
The Digital Divide
Dr. Piti claimed that the Digital Divide was another battle as the US and China, particularly the mobile telephone companies Apple and Huawei, contend for technological superiority.
Greater use of Artificial Intelligence ( AI ) will reduce the role of Tour Operators in planning trips and making bookings and reservations, even though the technology that goes into mobile phones will make travel more convenient.
This, along with the increased use of technology, does have an effect on job development in travel and tourism, particularly among the rank and file. Robots and ai you carry out a lot of the recurring jobs.
Problems with Personnel Management Compared to Robots
Troubles with personnel control are one of the biggest problems, particularly in hotels. However, computers operate nonstop for 7 days a week.
Most importantly, they do n’t call in sick, have marital issues, use drugs, or irritate customers. The query is,” How do you adjust?”
6G tech
Equipment support may be needed for all of this technology, particularly for the use of 6G technology.
And this creates yet another digital split as nations like Thailand are in the lead while others like Indonesia are falling behind. This will necessitate ongoing expense in maintaining the infrastructure’s improvement.
Move to energy
It will also be difficult to make the energy move. As the earth switches to renewable energy sources for source, fresh difficulties appear.
Solar power, for instance, is worthless at night because it cannot keep electricity but can only generate it. The cost of electricity storage is extremely large. When electricity storage becomes widely used, more money will be needed to upgrade the equipment.
a sporting event
Additionally, he mentioned the erratic cost swings brought on by fluctuation or even transient occasions like sporting competitions.
When special basketball games are broadcast, bars in England triple the cost of beers and return to normal afterward.
” Changing computer labels is made very simple by geographic computing.” Therefore, the cost of rain-protection items may be increased right away if, for instance, you are walking through a shopping mall and it starts to rain.
Market prices schemes, according to Dr. Piti, are also fraught with uncertainty and may be inflationary.
In the past, the cost of an airline ticket included all, including dishes, luggage, and other expenses. Everything is now paid for by the consumer.
In the future, what will this imply?
Are there fees for using restrooms on flights? Did hotels charge for amenities like mattresses and water?
Climate Change
Prof. Piti claimed that due to natural disasters, culture shift is now having an impact on many facets of life. SOURCE: Travel &, Tourism Urged to Perform Less Company in US Dollars | eTurboNews
