Prime Minister Thaksin Shinawatra recently assured the
public that Thailand would not face a repeated economic crisis. He
believes the country’s gross domestic products (GDP) will grow no less
than 4% by the end of the year. He said that there was nothing to be
worried about regarding Thailand’s economic conditions over the next 5-6
years, as more concrete cooperation among Asian countries should lead to
greater trade opportunities and more balanced financial status in the
region.
Thaksin stressed the Thai economy will be less affected
by the current conflict between the United States and Iraq. "Even if
the conflict between Washington and Baghdad breaks into war, as is likely,
it will have less impact on the Thai economy, as it will be a limited
war," Thaksin said.
The remarks came after the Office of the National
Economic and Social Development Board (NESDB) reported that the Thai
economy grew 5.1% in the second quarter of this year, higher than the 3.9%
during the first quarter and 1.8% of the same period of last year.
NESDB then adjusted the country’s forecast growth
rate to 4.0-4.5% this year, from 3.5-4.0% it forecast in June.
NESDB Secretary-General Chakramon Pasukavanich said
that there was growing demand in both domestic and international markets,
which led to higher domestic consumption and investment, and increased
exports, particularly those of the non-agricultural sector.
Thailand’s non-agricultural sector grew 5.4% in the
period, while the agricultural sector grew only 2%.
For the non-agricultural sector, the country’s
industries grew 6.7% in the same period, particularly those of the
manufacturing of automobiles and parts, and electronic and electric
products, while the construction area grew as high as 18.6%.
In the second quarter, domestic consumption grew 3.8%
due to higher household incomes and low interest rates, while domestic
investment in both the public and private sector grew 7.6%, particularly
in the property sector.
General Chakramon said that in the first six months of
this year, the country’s GDP grew 4.5%, higher than what was earlier
expected, due to higher private investment of 8.8%, as well as higher
exports and household spending around 13% and 3.7% respectively amid low
inflation and interest rates.
However, the country’s economic growth pace could be
somewhat affected by external risk factors, particularly in the fourth
quarter, including fragile economic recovery in the U.S., higher world oil
prices, and possible war between Washington and Baghdad. Therefore, the
economy could expand less in the last six months of this year, with an
estimated growth rate of around 4% in the third quarter and less than 4%
in the last three months.
"Overall, the Thai economy should grow 4.0-4.5%
this year despite the possible U.S.-Iraq war, which we think will be
limited. The continued growth is due to investment and consumers’
spending," General Chakramon said.
NESDB projected that the nation could earn US$64.2
billion of export revenues this year, 1.7% higher than that of last year,
while its imports could reach US$63.4 billion, 4.5% higher than last year.
Thailand could, thus, have a trade surplus of around
US$800 million this year, while its surplus in the current account could
reach US$4.3 billion, or around 3.4% of GDP.
In 2003, the Thai economy is projected to grow around
4%, according to the NESDB chief, who says that clearer estimates of the
Thai economy for next year can be made after the third quarter of this
year. (TNA)
