oreign direct investment (FDI) to build plants to build "screwdriver plants" (Ciminero, 1997) that would assemble and ship consumer electronics products and other labor-intensive goods. Ciminero, and other analysts (Crampton, 1997, A2) point out that as long as the baht was pegged to the dollar, Thailand was viewed as even more attractive for FDI and foreign portfolio investment in its securities market (Limsamarnphun, 1997, 4). Given the large influx of investment, "it is no surprise that the country typically runs a large negative balance of payments (BOP) on net investment income" (Ciminero, 1997).
Linking a nation's currency to the dollar (or yen, or British pound or Swiss Franc) is a safe idea for growth with a couple of basic cautions: A) the nation must maintain a trade surplus to keep its balance of payments in order; and B) the nation must protect its internal consumer markets. Thailand did neither. As Ciminero points out, "In recent years. . . the trade surplus has evaporated,
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