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Reflecting on currency exposure

Legacy Phuket Gazette

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Reflecting on currency exposure | The Thaiger

PHUKET: If you are a long-term expatriate living in Phuket, Thailand, you have probably seen the Thai baht appreciate significantly against your home currency – a trend that will likely continue for the foreseeable future.

This appreciation (along with an average inflation rate of 2.7% since 2000) makes it increasingly expensive to live in Thailand at a time when you are probably contending with near zero interest rates back home and low cost of living adjustments to your pension.

Fortunately, there are investment strategies that will help you, as an expatriate living in Thailand, to manage or limit your currency exposure risks.

Before you consider investing, you must first determine the level of your currency exposure and risks by answering the following simple questions:

1) Do you divide your time between living in Thailand and living in your home country?

2) Do you foresee returning (or being forced to return) to your home country?

3) Do you still own property in your home country?

4) Do you have other liabilities back home or denominated in your home currency?

5) Do you still need to pay taxes in your home country on your investments or other income?

6) Do you need to disclose offshore investments to your home country’s tax authorities?

If you answered yes to most or all of these questions, then you will need to keep most of your investment portfolio exposed to your home currency and the various offshore investment products marketed to expatriates probably won’t make financial sense.

Americans in particular, need to be careful, due to taxation policies that apply worldwide and increasingly onerous requirements to disclose any kind of offshore accounts, along with the possibility of having to return to the USA to use Medicare for major medical problems.

With the answers to the above questions in mind, a possible investment strategy would be to allocate a portion of your investment portfolio and income to cover any liabilities or expenses you have in Thailand, and another portion of your investment portfolio to cover liabilities or expenses in your home country.

For example: visits to your home country and any liabilities there (taxes, a mortgage on a home, your children’s or grandchildren’s education) should be covered by the return or income from the portion of your investment portfolio exposed to your home country’s currency, while the rest of your portfolio will need to have a more aggressive return to keep up with your liabilities and expenses in Thailand as the baht appreciates.

Fortunately, you do not need to convert part of your investment portfolio into baht and invest directly in Thailand.

Exchange traded funds (ETFs) that trade on major world stock exchanges and invest in emerging markets, such as the iShares MSCI Thailand Index Fund (THD), or invest in foreign currencies can provide an easy way to give your investment portfolio a more aggressive return to keep up with an appreciating baht (and Thailand’s rate of inflation).

Moreover, many ETFs that invest in emerging markets (or internationally) are internally hedged to major world currencies to limit the impact negative currency swings will have on their returns.

However, you will need to be cautious when choosing your investments, as the currency your investment accounts are denominated in may not accurately reflect the actual currency exposure your investments have.

For example: A non-American investor who invests in multi-national company stocks that are either based in the United States or do most of their business there, will actually have an investment portfolio more exposed to the US dollar than to their home currency.

That may actually work out nicely if you are a British investor living in Thailand as the British pound (GBP) has depreciated more significantly against the baht than the US dollar (USD) has over the last decade, but it would be a negative if you are an Australian investor living in Thailand, as the Australian dollar (AUD) has largely kept pace with or has actually appreciated more in value against the baht.

For that reason, and if you are British (or to a lesser extent, American), you may have been better off if a portion of your investment portfolio was focused on Australian stocks or ETFs.

Don Freeman is president of Freeman Capital Management, a Registered Investment Advisor with the US Securities Exchange Commission (SEC), based in Phuket, Thailand.

He has over 15 years experience and provides personal financial planning and wealth management to expatriates. Specializing in UK and US pension transfers. Call 089-970-5795 or email: freemancapital@gmail.com.

— Don Freeman

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Archiving articles from the Phuket Gazette circa 1998 - 2017. View the Phuket Gazette online archive and Digital Gazette PDF Prints.

Thailand

Facebook removes “information-influencing” pages linked to Thai military

Maya Taylor

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Facebook removes “information-influencing” pages linked to Thai military | The Thaiger
PHOTO: Facebook

Facebook has confirmed the removal of 185 accounts run by the Thai military and allegedly involved in information-influencing. The social media giant says the accounts were deleted for engaging in what it calls, “coordinated inauthentic behaviour”. In total, 77 accounts, 72 pages, and 18 groups have been removed from the platform, in addition to 18 Instagram accounts. It’s the first time Facebook has taken such action against accounts linked to the Thai government.

The accounts were associated with the Thai military and were targeting people in the southern provinces, Facebook said its regular report on coordinated inauthentic behavior. The south of the country has been the scene of decades-long conflict, with insurgent groups in the majority-Muslim, Malay-speaking region calling for independence. To date, around 7,000 people have died in the ongoing struggle.

Facebook says the deleted accounts were most active last year and used both fake and real accounts to manage pages and groups, both openly military pages and pages that hid their links to the military. Some of the fake profiles pretended to be people from the southern provinces.

The report mentioned a post by the now-removed account named “comprehending the operation” in Thai. The page posted the logo for Amnesty International Thailand and wrote “The NGO never cares about ordinary citizens because they have no role in society. Normal people are not famous. Any case is not big news. They are not worth the investment of foreigners so they will not do anything to help. This is why we don’t see anything from the NGO.”

Facebook removes “information-influencing” pages linked to Thai military | News by The Thaiger

Image overlay translates to “The NGO never cares about ordinary citizens because they have no role nor money.”

On another now-removed account, named “truth about my home Pattani” in Thai, a post said “Muslim leader declares southern border is a peace zone. The southern separatists started a movement by spreading the idea that Thailand is under control by different believers so that people would come and fight for their religion. This was declared that the action clearly violates Islam faith.”

Facebook removes “information-influencing” pages linked to Thai military | News by The Thaiger

Image overlay translates to “Southern border is not Jihad zone.”

When contacted by Reuters, the military had no comment on the removal of the Facebook accounts, with a spokesman saying the organisation does not comment outside of official press conferences.

The head of Cybersecurity Policy at Facebook, Nathaniel Gleicher, has confirmed the reasons behind the platform’s decision.

“This is the first time that we’ve attributed one of our takedowns to links to the Thai military. We found clear links between this operation and the Internal Security Operations Command. We can see that all of these accounts and groups are tied together as part of this operation.”

He adds that the accounts had spent around US$350 on advertising on both Facebook and Instagram. One or more of the pages had about 700,000 followers and at least one of the groups had 100,000 members. Gleicher says the accounts were removed because of their misleading behaviour and not because of the content being posted. The content included support for the military and the monarchy, with allegations of violence and criticism of insurgent groups in the south.

It’s not the first time accounts linked to the Thai military have been removed by a social media platform. In October, Twitter removed 926 accounts it says had links to the army and posted pro-military and pro-government content. The Thai army has denied any involvement with the accounts in question. In November, Twitter also suspended an account posting pro-monarchy content that was found to have links to the palace and to thousands of other accounts posting similar content.

To read the February 2021 Coordinated Inauthentic Behavior Report, click HERE.

SOURCES: Reuters| Facebook

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Central Thailand

Airline executive arrested for failure to pay wages of 150 workers

Maya Taylor

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Airline executive arrested for failure to pay wages of 150 workers | The Thaiger
PHOTO: Wikimedia

An airline executive has been arrested in the central province of Samut Songkhram, after complaints from150 employees that they had not been paid. Chawengsak Noiprasan, who had a court warrant issued against him in October, was taken to Don Muang police station from a property in the Bang Khan Take sub-district. He is a board member of Siam Air Transport.

The airline began operations in October 2014 with services out of Don Mueang to Hong Kong, using 2 Boeing 737-300s. 2 Boeing 737-800s were added to its fleet in late 2015. It expanded by adding Zhengzhou and Guangzhou in China to its network in early 2015. In late 2015, the airline launched flights to Macau and Singapore. In 2017, the airline ceased all operations.

But according to an article in the Bangkok Post, the carrier operates a number of scheduled and charter flights from Bangkok’s Don Mueang Airport. The Post reports that, as Chawengsak signs the company’s legal paperwork, all legal matters concerning the airline fall to him.

The Metropolitan Police Bureau says the executive has admitted to ignoring a 30 day notice issued by the labour inspector and ordering the payment of wages to 150 workers. It’s understood he is also wanted in relation to 7 other cases.

The authorities sought Chawengsak’s arrest following complaints from employees who say they haven’t received their wages for 2 months. It’s understood the airline had previously deferred salary payments for over 8 months. 150 workers filed an official complaint with Don Mueang police and also approached media outlets, asking them to pressure the airline into paying the money owed.

SOURCE: Bangkok Post

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Business

Governments & old media versus social media – who will win? | VIDEO

The Thaiger

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Governments & old media versus social media – who will win? | VIDEO | The Thaiger

We look at the recent changes made by the Australian and Indian governments to except control over the world’s biggest social media platforms. India has issued strict new rules for Facebook, Twitter and other social media platforms just weeks after the Indian government attempted to pressure Twitter to take down social media accounts it deemed, well, anti social. There is now an open battle between the rise of social media platforms and the governments and ‘old’ media that have been able to maintain a certain level of control over the ‘message’ for the last century. Who will win?

The rules require any social media company to create three roles within India… a “compliance officer” who ensures they follow local laws; a “grievance officer” who addresses complaints from Indian social media users; and a “contact person” who can actually be contacted by lawyers and other aggrieved Indian parties… 24/7.

The democratisation of the news model, with social media as its catalyst, will continue to baffle traditional media and governments who used to enjoy a level of control over what stories get told. The battles of Google and Facebook, with the governments of India and Australia will be followed in plenty of other countries as well.

At the root of all discussions will be the difference between what governments THINK social media is all about and the reality about how quickly the media landscape has changed. You’ll get to read about it first, on a social media platform… probably on the screen you’re watching this news story right now.

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