Confusion amid reports Thailand's top economic team to resign

[Susco]

4 minutes ago, Trillian said:

The Pound is up but the USD Dollar Index is down.

 

https://www.poundsterlinglive.com/data/currencies/gbp-pairs/GBPTHB-exchange-rate/

You think so?

 

The dollar and Euro have gained almost 1 Baht since July 1

[JonnyF]

36 minutes ago, Trillian said:

No it's not OK to give up the past 4 years of export growth, the point is that it's not a major disaster however.

 

Your math: that's 19% of 67% (not of 100%), for three months out of the past six ONLY, you can't get to 20% for the entire year using those numbers!

 

My job: is in finance and economics but it's nothing to do with what you think it is, least of all anything to do with "talking up" the Thai economy or the Thai Baht. But it does have a lot to do with dealing in fact which is helpful when discussing these types of subjects on social network forums because generally there's so little of it to be seen in these places.

 

Well we're only just into Q3. Q1 wasn't too bad since it didn't really hit until March.

 

Q2 was horrendous. Q3 could be even worse than Q2. I doubt it will be better when you look at the situations of the countries that Thailand exports to.

 

So we're looking at 9 of the 12 months being pretty dreadful. And you reckon an 8% GDP drop overall is realistic given that exports (67% of GDP) are down 22% in Q2 and tourism (domestic and international) is also massively down?

 

What about the rest of the domestic economy? You think that will tick along the same as 2019 or do you think maybe, just maybe all those people who have lost their jobs might reduce their spending? You think people might postpone that truck they were going to buy? I haven't even lost my job and my monthly spend for Q2 was less than half of normal because the shops and pubs/restaurants were closed. Everyone I know was the same. 

[Trillian]

2 minutes ago, Susco said:

You think so?

 

The dollar and Euro have gained almost 1 Baht since July 1

Sorry, I meant against USD and THB, I don't track Eero exchange rates at all.

[sweatalot]

11 hours ago, tribalfusion001 said:

The 2nd wave is not the virus, it's economic fallout from the lockdowns.

Exactly

[Susco]

3 minutes ago, Trillian said:

Sorry, I meant against USD and THB, I don't track Eero exchange rates at all.

What has the USD/THB exchange rate has to do with Euro exchanges?

 

Today you get almost a full Baht more for your USD compared to 1st of this month

 

Same goes for the EUR/Thb

Edited July 16, 2020 by Susco

[solent01]

Drain the swamp.........

[rocksniffer]

Wait for it to pass, going to be long wait.

 

It is never going to pass, just lie low for a while. Once a virus is in the world it joins a very long list. https://en.wikipedia.org/wiki/List_of_virus_species  There have been suggestions that Covid19 may be an annual event, like flu. In my opinion the countries with the hardest lockdowns will suffer the worst economic hardship. And the knock on effects from economic disaster will kill way more people than Covid19 would. 

[Trillian]

3 minutes ago, JonnyF said:

Well we're only just into Q3. Q1 wasn't too bad since it didn't really hit until March.

 

Q2 was horrendous. Q3 could be even worse than Q2. I doubt it will be better when you look at the situations of the countries that Thailand exports to.

 

So we're looking at 9 of the 12 months being pretty dreadful. And you reckon an 8% GDP drop overall is realistic given that exports (67% of GDP) are down 22% in Q2 and tourism (domestic and international) is also massively down?

 

What about the rest of the domestic economy? You think that will tick along the same as 2019 or do you think maybe, just maybe all those people who have lost their jobs might reduce their spending? You think people might postpone that truck they were going to buy? I haven't even lost my job and my monthly spend for Q2 was less than half of normal because the shops and pubs/restaurants were closed. Everyone I know was the same. 

Unlike you I'm only prepared to accept what has actually already happened as fact, what may happen in the future is another question and yet to be determined. I also try to be optimistic rather than pessimistic otherwise there's a temptation to just collapse into despair and not pay attention to the positive things.

 

BOT currently forecasts -8.1%, as already said I suspect that may change to at least -10%, so? They are just numbers, whatever they may be doesn't change the actions that need to be taken at this point so dwelling on what the numbers might be is really not useful.

 

I do however think that domestic consumption may surprise to the upside, there's a lot more disposable income available in Thailand than most people on this forum care to acknowledge. That's because everyone seems to be wrapped up in the plight of the impoverished rural poor, perhaps because that's all they see. The middle and upper classes spent THB 440 bill. on foreign travel last year, that's about 7% of GDP, if those people spend only half of that amount in Thailand it will help reduce the negative fall in GDP. 

 

[Trillian]

8 minutes ago, Susco said:

What has the USD/THB exchange rate has to do with Euro exchanges?

 

 

Nothing much at all, as said, I track only USD/GBP, USD/THB and GBP/THB, I don't pay attention to Euro.

[Jack Cook]

Buckle up here comes the nosedive. Watch how fast this all unwinds. The Bht might get slam dunked back to reality

[statman78]

1 hour ago, Trillian said:

As said previously, some exports, parts of some exports, use supply chain components that come from overseas.

 

But part of the bigger answer is in what you wrote, a 22.5% fall to the smallest exports since 2016. That means that exports increased by 22.5% in under four years, it has always been said that a rate of rapid growth such as that was never going to be sustainable, even without the virus! The question that now has to be asked is whether USD 16 bill. in exports per month is a big enough figure to sustain the Thai economy, most people with any knowledge on the subject will tell you that yes it is.

 

And whilst that 6X.X% figure for exports is correct, it does contain the 11.5%  that is international tourism which is also an export.

 

Finally, as exports fall so do imports but not by the same amount. That creates a scenario where the trade surplus might just become a trade deficit which would result in no new contributions to the Foreign Currency Reserves and might just help weaken THB, a move that will help exports. Get the picture now?

 

 

Trillian,

Just a correction to one of you statements which actually supports your arguments.

"a 22.5% fall to the smallest exports since 2016. That means that exports increased by 22.5% in under four years" is not correct since percentages are not additive.  A 22.5% fall to a point 4 years years ago means that the increase was really 29%.

 

For example;  Assume the maximum is a nice round number like 100.  A 22.5% fall back to 2016 means we are back to 77.5 as the starting point.  From this starting point of 77.5 we would need a (22.5/77.5)*100% increase.  This is a 29% increase from 2016.

 

Calculating the % increase from 2016 and calculating the % decrease from 2020 uses different denominators.

[Pedrogaz]

To me, Somkid was the only adult in the government. I think he has done a decent job under difficult circumstances. He is about the only one who is credible and appears to be competent.

[Cake Monster]

2 hours ago, Trillian said:

Some exports, some parts of exports, but not all by any means.

 

1. Machinery including computers: US$40.2 billion (16.4% of total exports)
2. Electrical machinery, equipment: $33.9 billion (13.8%)
3. Vehicles: $28.9 billion (11.8%)
4. Gems, precious metals: $15.7 billion (6.4%)
5. Rubber, rubber articles: $15.3 billion (6.3%)
6. Plastics, plastic articles: $13.3 billion (5.4%)
7. Mineral fuels including oil: $8.5 billion (3.5%)
8. Meat/seafood preparations: $6.7 billion (2.7%)
9. Optical, technical, medical apparatus: $5.4 billion (2.2%)
10. Organic chemicals: $4.6 billion (1.9%)

http://www.worldstopexports.com/thailands-top-10-exports/

With Vehicle sales Globally apparently falling off a cliff, the 11.8% GDP is going to take a really heavy hit.

The EU has already stated that Vehicle sales are down 25%, so on a pro rata basis lets assume the GDP for vehicles will fall to around 75%, thats about 9% instead of 11.8 %, a drop of $7.2 Billion of GDP.

If we also assume that due to a tightening of purse strings Worldwide, the purchasing of White Goods and Computers, the other Two of the top 3, will also drop - lets say 10% with a combined GDP hit of Approx another $7.4 Billion.

Already the total is more than the entire Plastics Industry GDP 6.4% of GDP worth $13.3 Billion.

Factor in the Tourism slump at 20% GDP and there you have a massive Economic hole appearing.

[Pottinger]

13 hours ago, dinsdale said:

Said it before. Prayut won't go. He'll put his uniform back on and roll out the army. Coming soon. Can't extend the state of emergency for ever as much as he'd like to. He will need to be overthrown by the people. It's the only way.

Not at all the only way, the Thai military in modern times has always been factionalised, usually based either on 'class of....' lines, or on perceived loyalty to you-know-who.

[webfact]

Thai finance minister says to resign amid economic team shakeup

 

FILE PHOTO: Uttama Savanayana, Palang Pracharat Party leader, holds a news conference after the general election in Bangkok, Thailand, March 27, 2019. REUTERS/Soe Zeya Tun

 

BANGKOK (Reuters) - Thailand's Finance Minister Uttama Savanayana on Thursday handed in his resignation, in a move that adds uncertainty to policy making at a time when Southeast Asia's worst-performing economy is struggling to recover from the impact of COVID-19 crisis.

 

The departure of Uttama, who confirmed his resignation at a briefing, comes as the government has been rolling out billions of dollars of stimulus measures in a bid to support an economy battered by the pandemic's hit to tourism and domestic activity.

 

According to media reports, Predee Daochai, president of the Thai Bankers' Association, is expected to be picked as the next finance minister.

 

(Reporting by Orathai Sriring, Kitiphong Thaichareon, and Satawasin Staporncharnchai; Editing by Ed Davies)

 

 

-- © Copyright Reuters 2020-07-16

 

- Whatever you're going through, the Samaritans are here for you

- Follow Thaivisa on LINE for breaking COVID-19 updates

[anchadian]

https://www.thaipbsworld.com/deputy-pm-somkid-and-his-cabinet-team-quit/

Deputy PM Somkid and his Cabinet team quit

Deputy Prime Minister Somkid Jatusripitak and his team of three Cabinet members formally submitted their resignations this morning, paving the way for a long-anticipated Cabinet reshuffle by Prime Minister Prayut Chan-o-cha.

[Cattleman]

Another coup is coming ?

[jesimps]

15 hours ago, phungo said:

Are you guys implying that the worst part of this economic downturn is yet to come? That those retired have inside info that <deleted> is about to hit the fan, and that is why they are resigning?

 

If this is true, those of us that have money from outside Thailand will profit since prices such as rent will go down?

 

Basically, what im asking is how does this affect me and you?

Not a chance. Teflon Thailand will come out of this smelling of roses and with a stronger baht, as it's done with every other crisis in the thirteen years that I've been here. Maybe if I leave the country things will change. Financially, everything I touch turns to dust.

[DirtyHarry55]

Don't worry the new Palang Pracharat Party leader Prawit is in charge now and I am sure will choose the best people for the jobs of spending the countries money.

[micmichd]

2 hours ago, Isaan sailor said:

Good news.  Thailand needs a strong industrial base to compete in the global marketplace.  Merely selling fruit and rice to China just won’t cut it.  China should be viewed as a friendly competitor—not as an overlord.

China and Thailand should work together in the medical and wellness sector more aggressively, that's where they're absolutely good. 

[tomauasia]

Yep the country needs tourists and this is not the right government for the job.

[Bangkok Barry]

8 hours ago, CorpusChristie said:

We dont have "mob unrest" in Thailand , thats a Western thing 

Of course we don't. Never. Thais would never do such a thing.

[CorpusChristie]

2 minutes ago, Bangkok Barry said:

Of course we don't. Never. Thais would never do such a thing.

That was before , things have changed since then , we have a strong Government now 

[Cake Monster]

20 minutes ago, DirtyHarry55 said:

Don't worry the new Palang Pracharat Party leader Prawit is in charge now and I am sure will choose the best people for the jobs of spending the countries money.

If he can stay awake long enough.

[Trillian]

1 hour ago, statman78 said:

Trillian,

Just a correction to one of you statements which actually supports your arguments.

"a 22.5% fall to the smallest exports since 2016. That means that exports increased by 22.5% in under four years" is not correct since percentages are not additive.  A 22.5% fall to a point 4 years years ago means that the increase was really 29%.

 

For example;  Assume the maximum is a nice round number like 100.  A 22.5% fall back to 2016 means we are back to 77.5 as the starting point.  From this starting point of 77.5 we would need a (22.5/77.5)*100% increase.  This is a 29% increase from 2016.

 

Calculating the % increase from 2016 and calculating the % decrease from 2020 uses different denominators.

Yes you are correct of course, I wasn't trying to be exact in my numbers but was instead trying to simply make the point although it wouldn't have hurt if I'd been more precise...I get lazy from time to to time after repeating the same things over and over to different people!

Edited July 16, 2020 by Trillian

[Trillian]

1 hour ago, Cake Monster said:

With Vehicle sales Globally apparently falling off a cliff, the 11.8% GDP is going to take a really heavy hit.

The EU has already stated that Vehicle sales are down 25%, so on a pro rata basis lets assume the GDP for vehicles will fall to around 75%, thats about 9% instead of 11.8 %, a drop of $7.2 Billion of GDP.

If we also assume that due to a tightening of purse strings Worldwide, the purchasing of White Goods and Computers, the other Two of the top 3, will also drop - lets say 10% with a combined GDP hit of Approx another $7.4 Billion.

Already the total is more than the entire Plastics Industry GDP 6.4% of GDP worth $13.3 Billion.

Factor in the Tourism slump at 20% GDP and there you have a massive Economic hole appearing.

Sure, nobody is saying there won't be falls in GDP or its components, the only difference between us is how much and how those falls are calculated. As said earlier your tourism slump of 20% isn't really 20% yet although it might be later, we don't know, today it's 3 months of 11.5% which is international tourism, what it might be later is another story that I wouldn't want to guess at.

[RichardColeman]

4 hours ago, paddypower said:

we have one of the best covid management results in the world.

So China banning some thai flight due to passengers arriving with covid is either Chinese lies or thai lies about figures and testing ?

[metisdead]

Referring to Thailand or the government as a dictatorship, military dictatorship or other such terms will be removed.

[NoshowJones]

3 hours ago, Mr Meeseeks said:

Most Thai politicians have never shown that they care for anyone but themselves.

How many of them are actually politicians, the only thing most military leaders and politicians have in common is that they are liars, and yes, they don't care for anyone but themselves.

[KhunG]

2 hours ago, Cake Monster said:

With Vehicle sales Globally apparently falling off a cliff, the 11.8% GDP is going to take a really heavy hit.

The EU has already stated that Vehicle sales are down 25%, so on a pro rata basis lets assume the GDP for vehicles will fall to around 75%, thats about 9% instead of 11.8 %, a drop of $7.2 Billion of GDP.

If we also assume that due to a tightening of purse strings Worldwide, the purchasing of White Goods and Computers, the other Two of the top 3, will also drop - lets say 10% with a combined GDP hit of Approx another $7.4 Billion.

Already the total is more than the entire Plastics Industry GDP 6.4% of GDP worth $13.3 Billion.

Factor in the Tourism slump at 20% GDP and there you have a massive Economic hole appearing.

Minor quibble.  Those are percents of exports, not GDP.  Exports are over two thirds of Thai GDP so the point you're making is correct.