World Economy

Thai Gov’t Sees Signs of Growth

Thai Gov’t Sees Signs of Growth
Thai Gov’t Sees Signs of Growth

After enduring a stagnant economy for most of the year, Thailand in recent days has begun to see signs of some hope at the end of a long, dark and gloomy tunnel. Signs of an economic pick-up are showing in the export sector, the lifeblood of Thailand’s economy.

The Prayut Chan-o-cha government, however, should not rest on its laurels with such rare positive news. It needs to do more to ensure a continued recovery, even one growing at a snail’s pace, TNA reported.

On Wednesday, the commerce ministry broke the “good news” about the recovery in Thailand’s outbound shipments. Customers-cleared exports rose for a second straight month in September, expanding by 3.4% year-on-year to 683 billion baht ($19.4 billion)—the highest in two years.

This growth helps narrow the nine-month contraction. The export sector, which has been reeling from the slowdown in the global economy, accounts for 53.7% of Thailand’s GDP. It is one of the key factors that has dragged down the prospects for economic growth and kept consumer sentiment subdued for months now.

The continued growth in exports during the past two months is an indicator that things are picking up, at least over the short to medium term.

Another healthy sign of economic recovery is the sharp growth in imports in September which were 5.6% higher from the previous year, a sharp contrast to the 1.5% year-on-year decline seen during the month of August.

Tourist arrivals could be fewer than the central bank’s current forecast of 33.6 million this year, but that was also because of a crackdown on cheap tour packages for Chinese tourists, Thailand’s largest number of visitors.

Tourism accounts for about 10% of Thailand’s GDP, and the industry has been a rare bright spot for an economy that has struggled to gain traction since the 2014 coup.

Thailand’s economy is still expected to grow 3.3% this year from a forecast range of 3.0-3.5% due to strong government spending and tourism while exports could perform better than forecast, the finance ministry said on Friday, Reuters reported.

The economy is projected to expand 3.4% next year, Krisada Chinavicharana, head of the ministry’s fiscal policy office, told reporters. Last year’s economic growth was 2.8%.

The ministry now expects exports, a key driver of the economy, to contract only 0.5% this year, better than the 1.9% decline it predicted three months ago.

In 2017, exports are expected to increase 1.8%.


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