Pattaya business leaders were given a briefing on the state of the Thai economy and advice where to make future investments from finance professionals at Standard Chartered Bank (Thailand).
Sukithi Jaratchaiwanna, senior director of the bank’s business finance and investment division, spoke to the Pattaya Business & Tourism Association at its Oct. 26 meeting at the Green Park Resort, along with senior economist Usara Wilaipit.
Sukithi Jaratchaiwanna, senior director of the Business Finance and Investment Division of the Standard Chartered Bank Thailand, gives the PBTA a briefing on the state of the Thai economy and advice where to make future investments.
The lecture covered strategies of how to invest in the global economy. The bankers spoke about the current economic situation in the United States and that the world economy should grow 3.1% in 2016. Economic production and services are expected to increase while unemployment stays low, they said.
However, the strong dollar, brought on by the end of the US’s fiscal stimulus, may affect the Thai economy, even through oil prices are only expected to increase 2 percent next year.
Sukithi said Thailand’s high economic growth at 8-9% per year during the late 1980s and early 90s was interrupted by the 1997-1998 Asian financial crisis. Since then, average annual economic growth has moderated to less than 4 percent.
This moderation reflects a combination of some decline in export competitiveness to newly emerging regional economies, a shortage of skilled labor and knowledgeable workers for the modern economy, and political changes and uncertainty that have affected public and private investment. More recently, Thailand’s economy expanded by a low 0.9 percent in 2014 and is expected to pick up slightly in 2015-2017.
The rate of recovery and reigniting economic growth will depend on how fast Thailand can overcome factors constraining growth and promote a more inclusive growth model.
There are opportunities in the horizon, including expanding trade through enhanced integration with the global economy, controlling domestic consumption and improving quality of public services across the entire country.
This will support a resumption of a higher, more balanced growth path that eliminates extreme poverty and boosts shared prosperity for all citizens.
The Thai stock market, however, is unstable, which is why it is necessary to seek new ways to invest and make sure that the new investments go in the same direction as the global economy.
Future projects such as the railway links to China are expected to improve the economy in Thailand. The project is also to expand to other neighboring countries, connecting Laos to Nong Khai, Udon Thani, Korat, Maptaput and Rayong.
Usara said that Thailand’s economy has dropped like many other countries due to the low cost of oil and gas, but it is estimated to drop only in the short term. Thailand is expected to restore its economy as the government has guaranteed support for construction industries, tourism industries and others within the next year.
Sukithi added that the global economy in 2016 is looking thin and most countries will not be able to get back on their feet. Thailand’s government is taking steps to assist rural areas hit by drought and low prices for farm products and in September it unveiled a stimulus package for small- and medium-sized businesses.
Such fiscal measures, together with planned large infrastructure projects and improved prospects for exports to major industrial economies next year, are seen lifting GDP growth in 2016 by over 1 percentage point from 2015.
