third, the subject of Baht zone, that is to say, the regular use to the Thai baht as international n the GMs is often as a consequence of being the strongest and closest economy in the subregion it least policy of the Thai government to see Thai baht a fully convertble intemational in the subregion, the fact remains that the use of Thai baht in thr GMs trade has become widespread, and the Thai monetary authorities did not attempt to discourage this use of the baht in the GMS from the practice one way or the other The benefits ofincreased point of view of Thailand are quite obvious. Thailand and its GMs neighbours are
First of all. trade and investment berween scarce in pected to increase because the need to use convenible umencies which are foreign- many of these GMS countries substantially removed. Secondly the cost of exchange purchase and the nsk of exchange-rate fluctuation from the point of view of Thai businessmen are reduced, providing an additional competitive edge to Thai bosinessmen. Thirdly as it has been projected that the balance of uade between Thailand and its GMS neighbours will be against Thailand in the future, the use of bahr will help reduce the Fourthly the use of ure on Thailand's intemational reserves, at least in the short-run senice hclping baht will have a direct link with domestic (Thai) production of goods and similar to the local economy. And fifthly the use of baht gives seigniorage gains to Thailand lending of these GMs countries to Thailand without charging interest. a larger regional
Fourth, eventually this sub regional economic cooperation will lead to with only in Southeast Asia are now members of ASEAN, As one of exception of East Timor which is the newest sovereign nation in Southeast Asia to lay the the general principles of GMS economic cooperation is that it has no intention docs Dot foundation towards the formation of a trade bloc, this sub regional cooperation APEC, conflict with the main guiding principle of ASEAN. And a larger context of ASEAN is always a proponent that APEC is a forum for intergovernmental cooperation with a view to supporting and promoting non-preferential and trade and investment in the Asia-Pacific region. As such the GMS economic zone could be looked upon as a pan of a much larger global economic arrangement that, once accomplished, will lead to a better life and livelihood of all the people in the region.