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Thai finance ministry raises 2020 GDP outlook to 7.7% contraction


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Thai finance ministry raises 2020 GDP outlook to 7.7% contraction

By Kitiphong Thaichareon

 

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FILE PHOTO: A truck moves containers at the port of Bangkok, Thailand May 26, 2016. REUTERS/Jorge Silva/File Photo

 

BANGKOK (Reuters) - Thailand's finance ministry on Thursday upgraded its 2020 gross domestic product forecast to a 7.7% contraction, still a record, from the 8.5% decline projected earlier, helped by government measures to mitigate the impact of the coronavirus pandemic.

 

The ministry also increased its 2020 estimate for exports, a key driver of growth, to a fall of 7.8% from an earlier 11.0% drop, deputy ministry spokesman Pornchai Theeravet told a news conference.

 

The government has announced a 1.9 trillion baht ($60.76 billion) coronavirus response package to support Southeast Asia's second-largest economy, which shrank the most in 22 years in the second quarter, with tourism badly hit.

 

Stimulus measures introduced in the current quarter to boost consumption should increase GDP by 0.54%, he said.

 

"The current stimulus measures are sufficient for now, but the government is ready to implement more if necessary," Pornchai said.

 

The ministry forecast 6.7 million foreign tourists this year before rising to 8 million next year, he said.

 

Thailand has recently started to allow tourists to enter only on long-stay visas that also require quarantine, but those tourism officials have said those visitors would represent only a fraction of the pre-crisis numbers.

 

Last year, the tourism-driven country welcomed a record 39.8 million tourists whose spending made up 11.4% of GDP.

 

Growing political protests have yet to affect the economy as domestic activity still continues, Pornchai said.

 

For 2021, the ministry predicts the economy will grow 4.5% versus a previous forecast range of 4.0-5.0% growth. It expects exports, also a key growth driver, to increase 6.0%, rather than rise 5.0% projected previously.

 

($1 = 31.27 baht)

 

(Reporting by Kitiphong Thaichareon; Writing by Orathai Sriring; Editing by Martin Petty)

 

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-- © Copyright Reuters 2020-10-30
 
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Finance Ministry lifts growth forecast to -7.7% after signs of recovery

By The Nation

 

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Adviser to the Fiscal Policy Office Pornchai Threeravej, centre, says the recovering Thai economy will grow by 4.5 per cent next year.

 

Seeing signs of recovery, the Finance Ministry has revised its economic forecast for this year, predicting a contraction of 7.7 per cent rather than the previous 8.5 per cent.

 

The move came after economic indicators for September released by the Fiscal Policy Office on Thursday showed improvement from the month before.

 

The economy is recovering in the second half of the year as Thailand’s major trading partners start to rebound from the Covid-19 crisis, while government spending shores up the local economy, said Pornchai Theeravej, adviser to the Fiscal Policy Office.

 

Optimism at the Finance Ministry is matched by the Bank of Thailand, which recently revised its forecast for the economy this year from -8.1 per cent to -7.8 per cent, he said. 

 

Pornchai added he expects to see economic growth of 4.5 per cent next year.

 

This year, Thai exports are expected to fall by 7.8 per cent, better than the previous forecast of an 11 per cent drop.

 

Private consumption and private investment are expected to contract by 3 per cent and 9.8 per cent respectively.

 

Meanwhile, government consumption and investment are expected to expand 4 per cent and 10.5 per cent.

 

The current account surplus is projected at $14.1 billion, equivalent to 2.8 per cent of GDP, which would contribute to economic stability, he said.

 

September saw VAT revenue – an indicator of consumption – increase 0.1 per cent year on year and 3.3 per cent month on month after seasonal adjustment.

 

Also rising from August were car sales (32.6 per cent) and newly registered motorcycles (0.7 per cent), though they fell 12.2 per cent and 0.2 per cent from the same period last year. Consumer confidence, however, fell slightly to 50.2 from August due to political protests in September.

 

Among private investment indicators, sales of commercial cars rose 13.5 per cent year on year and 5 per cent from August. Imports of capital goods grew 4.4 per cent from August and contracted at a decelerating rate at 7.5 per cent year on year, suggesting rising private investment activity. Exports contracted at a slowing rate, at 3.9 per cent.

 

Sales of cement rose 0.9 per cent year on year. Tax revenue collected on property transactions rose 4.7 per cent from August with contraction decelerating, at 13 per cent year on year.

 

Looking ahead, downside risks are surging from a leap in Covid-19 infection rates in many countries, the US presidential election on November 3 and the Brexit deal.

 

Meanwhile, Fitch Ratings has reaffirmed Thailand's sovereign credit rating at BBB+ with a stable outlook.

 

However, Fitch said it was closely monitoring Thailand’s rising household debt and political unrest for signs it may adversely impact effective policy implementation and economy growth in the mid-term.

 

Source: https://www.nationthailand.com/business/30397003

 

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-- © Copyright The Nation Thailand 2020-10-30
 
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TAT officials have found a new department by the look of it could be 10% growth by the end of the year with the hoards STV 's clamoring to get in 🤔

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I know the complete story.  The cleaner knocked the crystal ball off it's perch it rolled across the floor and hit the wall and is now out of alignment.  The cleaner fearing getting fired from her 300 baht a day job put it back on it's perch and said nothing.  So all their predictions are out of kilter with reality.   Zender the witch is not due to come in for the annual realignment ceremony till June next year.  This gives the cleaner plenty of time to find another job as Zender the witch will know all...a bit like Prayuth! 🙄

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55 minutes ago, Grumpy John said:

I know the complete story.  The cleaner knocked the crystal ball off it's perch it rolled across the floor and hit the wall and is now out of alignment.  The cleaner fearing getting fired from her 300 baht a day job put it back on it's perch and said nothing.  So all their predictions are out of kilter with reality.   Zender the witch is not due to come in for the annual realignment ceremony till June next year.  This gives the cleaner plenty of time to find another job as Zender the witch will know all...a bit like Prayuth! 🙄

You post in jest but the irony is that fortune tellers and mystics will have been consulted. 

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5 hours ago, RichardColeman said:

It appears that the finance clowns don't talk to the banks who just said tourism made up 20% of thai GDP. That is at least down 75%, exports are down also. Quite how -15% gdp and a loss on exports can equate to only -7.7% gdp drop is outstanding BS. 

 

Anything that comes in less than -15% is utter edited garbage and another reason that the PM and the rest are clinging to power, as if the truth was known ..............

 

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