Fraud-fueled fortunes: The dark money behind Thailand’s surging baht

THAILAND: In 2025, Thailand’s baht scaled approximately 10% compared to the US dollar, making it one of the world’s top-performing currencies. On paper, that sounds like good news, but the reality on the ground is more complicated.

The Thai economy is limping along: growth is barely 1.8% year-over-year, interest rates are low, and household and public debt are high. Usually, those conditions weaken a currency, not strengthen it.

Economists are left scratching their heads. One prevalent theory points to gold. Thailand is a key hub for gold exchange, and 2025 was the year for the costly metal, with prices up 67%.

Buying gold often means buying baht, which could explain part of the currency’s rise. Yet for Thai officials, a strong baht is more trouble than triumph. The Bank of Thailand is now requiring banks to report foreign currency transactions above $200,000, and the Ministry of Finance is weighing a tax on online gold trades to slow the inflows.

The human cost of a strong baht

A strong currency might sound like a win, but for everyday Thais, it’s creating real problems. Imports are low-priced, which might appear good, but it makes life tougher for homegrown growers and producers, who unexpectedly have to vie with discounted overseas products. Small-margin agricultural products are especially vulnerable, and export-focused factories feel the pinch as well.

Tourism, a lifeline for millions, is also suffering. A stronger baht makes Thailand more expensive for foreign visitors, from hotel stays to street food. As a result, tourist arrivals have dropped nearly 10% this year, while neighbouring countries like Vietnam and Malaysia are seeing big increases. For those who depend on tourism for their livelihoods—hotel staff, tuk-tuk drivers, restaurant owners—the currency’s strength is more of a burden than a blessing.

Money from the shadows

Some experts believe there’s an even darker force behind the baht’s climb. Investigative reports suggest billions of dollars from scam operations in Cambodia and Myanmar are being funnelled into Thailand, converted into baht, and invested in local businesses and real estate. Bradley Hope and Tom Wright, the journalists who exposed Malaysia’s 1MDB scandal, have traced parts of these flows into major Thai banks and companies.

If these reports are correct, it means the baht is being propped up not by a thriving economy, but by money from criminal networks. Some of this cash stays in Thailand, inflating asset prices and creating the illusion of a strong currency. Australian economist Sean Turnell warns that even if the exact impact is hard to measure, ignoring these inflows would be a mistake—because they distort the economy and affect ordinary Thais.

The bottom line

Thailand’s baht may look strong on paper, but for farmers, factory workers, and tourism operators, it’s a source of stress. Untangling the currency’s rise from illicit money flows isn’t just a technical issue—it’s a question of protecting the livelihoods of millions.