Finance Minister remains confident annual economy will see expansion

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BANGKOK, 21 August 2013 The Ministry of Finance’s Fiscal Policy Office has asserted that it is now necessary to issue economic stimulus measures, as the economic growth figures have been negative for two consecutive quarters. 

According to Ekniti Nitithanpraphat, deputy director of the Fiscal Policy Office (FPO), his agency is preparing to revise its economic growth forecast for year 2013 down from the prior forecast of 4.5%, due to the clear signals of economic slowdown. These signals come from both the consumer sector and private investments. He added it is necessary for the government to speed up the use of the remaining fiscal budget and ensure the targeted budget use is reached, as well as implement economic stimulus measures at the same time. He noted that the 2-trillion baht infrastructure development project will have an important role in pushing the economy to expand at the end of the year.

In the meantime, Finance Minister Kittirat Na Ranong asserted in Tuesday’s Cabinet meeting that he remained confident the annual economic expansion would be positive and that the country would not enter recession. He indicated that for the latter half of the year, the government would promptly use economic stimulus measures such as state sector budget disbursement and the stimulation of the export sector.

At the same time, Bank of Thailand Governor Prasarn Trairatvorakul said the figures indicating negative economic expansion did not take into consideration seasonal adjustments. He attributed the high expansion figure for quarters 1 and 2 of the previous year to the fact that growth in those quarters were measured against growth experienced during the great floods of 2011’s 4th quarter, saying that an exaggerated base was being used when comparing 2013’s 1st- and 2nd- quarter expansion to that of the same period in 2012,