BANGKOK, 24 May 2011 – Kasikorn Research Centre (KResearch) has expected that the money circulation during the current election campaign for the 3 July general election will push forward the Thai economy in the second quarter to grow by additional 0.9%-1.4%.
KResearch reported that the Thai economy in the second quarter this year still faces a rising cost of living which might reduce consumer spending; however, election campaigns by political parties will be a major force stimulating the economy in the second quarter this year to a certain extent.
Although analysis found there was no clear relationship between economic growth and election campaigns in the past, some businesses are expected to receive benefits from this election such as printing, advertising, and beverage businesses as each candidate is allowed by the EC to spend no more than 1.5 million baht on election campaign.
KResearch expected that election campaign and related activities will add up the Gross Domestic Product growth in the second quarter this year by 0.9-1.4% compared with the situation when there is no election while the economic growth for the second quarter is projected at 3% year-on-year.
KResearch added that the centre still keeps the Thai economic growth projection for the whole year at 3.6% which is still in the estimated frame of 3.0-4.0% under the circumstances that the Dubai crude price is at around 108 US dollars per barrel while the headline inflation will be at about 4.0%.
Meanwhile, the National Economic and Social Development Board estimated that over 20-30 billion baht will be circulating in the system during this election, up 3.3% from the previous election in 2007 due to rising living costs.
