BANGKOK, Dec 17 – The Thai Chamber of Commerce University’s Economic and Business Forecasting Center slashed its GDP growth forecast this year from 3.5 per cent to 3 per cent as a result of the ongoing protests which has caused economic damage at Bt30-70 billion, or 0.3-0.5 per cent.
Centre director Thanawat Phonwichai noted that this is the first time the Thai economy has slowed owing to internal factors, not the global economy or natural disasters.
He warned that Thailand’s economy next year will still be fragile based on the assumption of four scenarios.
— The economy will grow 4.6-5 per cent under the condition that politics is stable and the government can continue its infrastructure investment plan while the private sector, foreign investors and travellers are confident in the country.
— The second scenario, most likely, is that the economy will grow at 4-4.5 per cent on condition that politics is quite stable, the government’s investment plan is close to what was planned and the private sector and foreign investors are moderately confident in Thailand. This projection was based on the fact that the forecast was
lower from the previous 5.1 per cent as a result of damage from political protests at Bt70-100 billion.
— In the third scenario, with unstable political situations and low investment, the economy will expand only 3.-4 per cent.
— The worst case scenario, which has a 5-10 per cent chance of happening, will be that next year’s GDP will grow at less than 3 per cent, the government will lack stability, there is political chaos, and political damage will be as high as Bt200-300 billion.
However, Dr Thanawat said the economic direction will be clear in Q2, while the February election in Q1 will boost the economy with a money circulation of Bt30-50 billion. However, if the Democrat Party boycotts the election, the circulation will fall to Bt10-20 billion.
Positive factors for next year’s economy are projected export growth at 6.5 per cent as a result of an improved world economy, the baht currency exchange standing at Bt32-32.50 against the dollar, and an inflation rate at 3 per cent.