News Brief No. 98/3

News Brief: Camdessus says Thailand has Made Impressive Progress in Implementing its Economic Program

January 23, 1998

Michel Camdessus, the Managing Director of the International Monetary Fund (IMF), said today "Together with other members of IMF management and staff, I have had extensive discussions with the Finance Minister of Thailand, Tarrin Nimmanahaemenda, and his delegation in Washington this week. These discussions have confirmed that the Thai authorities have made impressive progress in implementing the economic program that is supported by a stand-by credit with the IMF and by financing from the international community. In particular, the program’s quantitative performance criteria continue to be met, external current account adjustment has been more rapid than anticipated, and structural reforms in a number of areas are well underway, most importantly in the financial sector. Given the deterioration in the economic environment in the region since the program was originally formulated, and its implications for economic activity, this has been especially commendable.

"I have also reviewed with Minister Tarrin various proposals for additional measures that can be taken to consolidate the progress that has been made. These will be developed more fully during the forthcoming IMF mission that will arrive in Bangkok in early February and stay for about 2 weeks. This mission will conduct the second review, when all aspects of the program will be comprehensively reviewed to allow Thailand, through its own efforts, and with all the support we can catalyze from the international community, to be able to promptly and fully overcome the present crisis. In particular, the macroeconomic framework of the program will be adapted to the changed economic environment, to take into account the more rapid external adjustment that is underway, and to incorporate the impact of the changed economic outlook on budgetary revenues; the need for a stronger safety net will also be assessed. I am confident that such flexible adaptation of Thailand’s economic program will better assure the achievement of its objectives, prevent an excessive contraction of economic activity, and allow for an early recovery of Thailand’s economy," Camdessus said.