The Automotive Focus Group (AFG) held a very successful and popular mini-seminar entitled, “What’s up (and down) in the world today (and implications for Thailand)” given by the always erudite Chris Bruton from Dataconsult.
After introduction from the AFG President James Beeson, Chris Bruton presented an overview of the world economics and pointed out that growth was expected to continue, though this would be weaker than previously anticipated in 2011 and 2012. He also presented tables to show that world GDP growth was expected to be around three percent, but in the developing countries it was expected to be between five and six percent.
Chris Bruton presents his mini-seminar entitled, “What’s up (and down) in the world today (and implications for Thailand).”
The European debt crisis would affect the rest of the world, which is why the Eurozone could not afford to let Greece go to the wall, and he did put forward the concept that perhaps the developed nations could not really afford the aid programs they have been giving. With China exporting to the US, there may be a slowing there, which will adversely affect America, and then with flow-ons go to other developed nations. A commodity downturn is expected. There is a very delicate balance in international trade versus international aid.
Developing countries which have high exports as a share of GDP will then be high risk, and this includes Malaysia at 110 percent, and to a lesser extent Thailand at 69 percent. Fortunately, Thailand has a low debt expressed as a percentage of GDP. He discounted Africa as being a major player at this stage, despite the raw materials, saying whimsically, “If they had socks, they would have to pull them up.”
Chris Bruton gave the opinion that next year for Thailand, “Is not looking bad. We are in a better position than many, though tourism will suffer because of lower levels of household wealth overseas.” He gave the view that the post-flood reconstruction will benefit the economy, though the proposed increase in the minimum wage will not.
He concluded by saying that the outlook for the US and Eurozone will be challenging. For Thailand it will have the double challenges of the western world and our own reconstruction. “Will the political will be enough?” he asked, in this situation of conflict.
His final words contained the Chinese curse, “May you live in interesting times!”
The AFG once again showed it is a very viable grouping amongst the automotive industry, presenting interesting and thought-provoking items at its meetings. People within the industry who may be interested in finding out more about the AFG can contact the secretariat through [email protected]