World Economy

Thailand Raises 2018 GDP to 4.2 Percent

Thailand is to develop its Eastern Economic Corridor.Thailand is to develop its Eastern Economic Corridor.

Thailand’s Finance Ministry on Monday raised its economic growth forecast for this year to 4.2% from 3.8%, and also raised its estimate for exports, an official said.

Exports, a key driver of Thai growth, should increase 6.6% this year, compared with the 5.7% predicted in October, ministry spokeswoman Kulaya Tantitemit told a news conference, Reuters reported.

Southeast Asia’s second-largest economy will mainly be driven by government spending and large public infrastructure projects this year, she said. Economic growth in 2017 is now estimated at 4%—which would be the fastest pace since 2012—and compared with the 3.8% the ministry projected three months ago, due mainly to stronger exports and tourism, Kulaya said.

Official 2017 gross domestic product data is due on Feb. 19. The economy expanded 3.2% in 2016, still lagging regional peers.

In December, the Bank of Thailand raised its economic growth forecasts for both 2017 and 2018 to 3.9% from 3.8%.

Kulaya said the strong baht, which is hovering at its highest level in more than four years against the dollar, should have only a little impact on exports because the economies of its trading partners are still showing solid expansion. The baht has appreciated by 4% so far this year, the second-most among Asian currencies.

The finance ministry also forecast the central bank will keep its policy interest rate at 1.50% throughout 2018. The rate has been unchanged since April 2015.

The central bank next reviews monetary policy on Feb. 14, and most economists predict no policy change.

  New Investment Magnet

New laws will be passed and more projects will be implemented to support the development of Thailand’s Eastern Economic Corridor, which is expected to be a new investment magnet, Thai News Agency reported.

Deputy Prime Minister Somkid Jatusripitak said the EEC has been developed to especially attract investments in digital businesses that have become a mega trend.

The facilitation of new electric and conventional trains, roads and investments are being accelerated to support the new development region and the present government would be spending every minute of its tenure to develop the EEC, Somkid said during a seminar in Bangkok on Thailand 4.0 and industrial and technological development.

“Many countries want to invest in ASEAN as it has teamed up with India, China, Russia and Japan. So, Thailand must grab the opportunities,” Somkid said.

Meanwhile, Industry Minister Uttama Savanayana said the EEC would be a large-scale production base for electric vehicles, robots and processed foods for specific groups of consumers among others.

Local production would also help the country save the cost of importing such products, he said.

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