The Unstoppable Rise of the Thai Baht

Gentlemen – we have to talk about the elephant in the room.

It’s the seemingly unstoppable rise in the value of the Thai currency – the Baht.

How many of us dream of living in Thailand, retiring there or even visiting the Land of Smiles on vacation?

Well our dreams are in danger of being shattered due to the relentless rise on the value of the Baht.

Many of my fellow Brits are aware of how much the Pound (GBP) has lost value against the Baht. In the 5.5 years since I lived in Bangkok the Pound has lost 25% of its value against the Baht!

Behold, the chart of shame:

THB vs GBP chart courtesy of XE.com (view the latest chart here).

Eurozone guys haven’t fared much better. The Euro is down 18.5% over the same time period.

And non-Eurozone guys have sometimes fared even worse. Norweigans love Thailand. When I visited Pattaya I had breakfast at a Norweigan cafe. It was pretty good. But how many Norwegian guys are going to visit or move to Thailand after the Krona has lost 33% of its value against the Baht in just 5 years? Ouch!

About the only currency that hasn’t done too badly against the Baht is the US dollar. It’s down just 10% in the same timeframe. That probably has a lot more to do with the USD’s reserve currency status rather than any particular strength in the American economy. Besides, I don’t think that many American guys visit Thailand these days. I saw hardly any American tourists the last time I was there. For guys seeking exotic beautiful foreign brides, there are far better hunting grounds in Central America, Latin America and the Caribbean. I also hear about a lot more guys retiring to tropical countries much closer home, particularly Costa Rica and Panama.

It’s not just the crumbling civilisations of the West whose currencies are depreciating against the Baht. I’m currently teaching English in China and I get paid in Chinese Yuan (CNY). Since mid-2015 the Yuan has lost 17.9% of its value against the Baht. This loss of purchasing power has happened right before my eyes. It’s down over 7.5% since I visited Bangkok 6 months ago. I thought it was expensive then – now it would just be a rip off!

A lot of potential tourists to Thailand are feeling the pain. Anecdotally I definitely saw a lot less Western tourists when I was there in the Summer of 2018. The most noticeable decline was in the number of Brits and middle-aged guys (i.e. the so-called sex tourist demographic).

Other tourism numbers must be down too. This year I could find plenty of seats to fly from China to Bangkok around Chinese New Year. In previous years seats were hard to come by. But this year I haven’t gone to Thailand because I couldn’t find a flight – I simply think it offers poor value for money.

Maybe many Chinese tourists are thinking the same as me. That relentless flood of millions of newly wealthy Chinese tourists into Thailand is likely to dry up soon.

I came pretty close to going to Thailand this Winter. But I just gave up trying to look for a decent and affordable hotel around Sukhumvit. When I first visited Bangkok I stayed for a couple of weeks in the Boss Suites Nana Hotel, halfway down Soi 4. The location was good and the room wasn’t bad.

Fast forward 5 years and the place had really gone downhill. There were rats in the ceiling crawl space, and they had even got into the wardrobe. There were also roaches in the room – a lot of them! I’ve stayed in some pokey hotels in China, but never in a place so roach infested as the Boss Suites Nana. I ended up buying a load of roach motels which did at least stop them crawling all over my bed.

This problem doesn’t seem to be confined to this particular hotel. The majority of the hotels in and around Sukhumvit have similar reviews on the hotel aggregator sites!

Why the Rise in the Baht?

So why is the Baht so strong? There are plenty of theories on the Thai Visa forum.

I guess the main reason is that Thailand is a business friendly environment, at least for the big boys. It has a strong and stable government. Sure, the people in charge come and go, but nothing seems to really change there. When I visited Bangkok in 2018 not that much had changed since I last lived there in 2013. Actually the only real difference was the increase in the number of tall buildings. Clearly a lot of big money is moving into Bangkok, and it has to buy THB in order to reside there.

I think that Thailand is in the midst of a long rise in popularity. For all the talk about global warming, it’s likely that we’re entering a mini-ice age. Expect 30 – 40 years of cooler weather all round the globe. Thailand will be a big winner if this is indeed true.

Thailand is also likely to be a big winner from China’s fall from grace. China is becoming an expensive place to own a factory. The government are also becoming extremely unfriendly towards foreigners.

So going forward I expect to see further gains in the Baht. If you’re going to retire to Thailand then you definitely need to factor this into your calculations. Personally I’ve started to invest more in Thailand and other emerging economies. Hopefully my retirement fund will keep up with their relentless rise in prosperity.

Smarter guys are also considering alternatives to Thailand. Over the last 5 years the Malaysian Ringgit is largely unchanged against the Pound. Malaysia has a similar climate to Thailand. It also offers an attractive retirement visa option, although it’s less affordable than the equivalent Thai visa.

There’s also the Philippines of course. The Phillies are extremely welcoming of foreign expats. Again, the Peso is around the same value against the Pound as it was 5 years ago.

Anyway, if you’ve been affected by the relentless rise in the Baht (or the slump of our crumbling currencies) then do please leave a comment and let us know your thoughts. Thanks for reading!