BANGKOK, Aug 19 – The Thai economy rose only 2.8 per cent in the second quarter of this year from a year earlier, a disappointing decline in growth which may limit this year’s growth at only 3.8-4.3 per cent, a leading economist said today
Arkom Termpitayapaisit, secretary general of the National Economic and Social Development Board (NESDB), said the less-than-projected GDP expansion was mainly due to a slowdown in household spending and the absence of the government’s economic stimulus.
Private investment has increased by only 4.5 per cent given a downturn in domestic auto manufacturing while exports will experience a 1.9 per cent deficit.
Q2 growth at 2.8 per cent was lower than the first quarter which posted a 5.4 per cent increase, contributing to a total GDP expansion at 4.1 per cent in the first half of the year.
In the first six months of the year, Thailand’s exports increased by only 1 per cent, domestic consumption by 3.4 per cent and private investment by 5.1 per cent, Mr Arkom said, adding that the tourism sector has become the major driving force for the Thai economy.
The NESDB has lowered this year’s growth forecast from an earlier projection at 4.2-5.2 per cent to 3.8-4.3 per cent, he said.
With export growth at only 1 per cent in the first half of the year, the government will have an uphill task in driving it up to at least 8.7 per cent in the third and fourth quarters in order to attain a yearly growth at 5 per cent, he said.
The government will have to boost monthly exports to US$21 billion from the current $18.9 billion, said Mr Arkom.
He was optimistic that exports would improve in the third quarter especially in the auto, electronics and jewellery industries, contributing to a higher GDP in Q3.
And the NESDB has closely monitored the economic recovery in Europe, the US and Japan which was rather slow, while China’s economy fails to spring back in light of the government’s delay in investment on mega infrastructure projects and less economic stimulus.
The state agency projected a growth in arriving foreign tourists from 24.7 million people last year to 26.2 million people this year.
If the government sector speeds up budget spending and allocation to the provinces as well as promote exports to neighbouring countries, Thailand’s GDP could increase by 4.3 per cent for the entire year, said Mr Arkom.
He urged a more relaxed monetary policy to stimulate Thailand’s economy, saying inflation remains low at 2.3-2.8 per cent.
