Slow growth not reflective of Thai economic potential, says BOT official

[webfact]

Slow growth not reflective of Thai economic potential, says BOT official

By The Nation

 

Don Nakornthab, a senior director at the Bank of Thailand (BOT), expressed optimism about economic outlook.

 

Thailand’s economic outlook is better than what the current slow growth suggests, a central bank official said, while an analyst urged the government to increase spending to boost the economy.

 

Don Nakornthab, a senior director at the Bank of Thailand (BOT), expressed optimism despite gross domestic product in the third quarter growing just 2.4 per cent year on year.

 

The growth rate in the third quarter from August to October was a bit higher than the 2.3 per cent  growth rate in the second quarter but the growth rate remained lower than expected, he said.

 

He, however, foresees a better economic performance due to the positive impact of government spending and public investment in infrastructure projects. But future growth would still be below Thailand's economic potential, he said.

 

The outcome of public investment still needed to be monitored closely, he said, referring to the delay in investment.

 

Global geopolitical risks remain, he said, adding, the US-China trade war had resulted in more trade barriers and remained a risk factor for the  Thai economy.

 

The Stock Exchange of Thailand Index rose 5.77 points on Monday (November 18) to close at 1,608 points.

 

“The market expects more government stimulus, following slower growth in the third quarter,” said Kobsithi Silpachai, head of capital markets research at Kasikornbank.

 

He said due to the relatively strong fiscal  position, the government has plenty of room to stimulate the economy.

 

The government is targeting fiscal deficit at Bt469 billion for fiscal 2020, with plans to spend Bt3.2 trillion.

 

Even though the Thai economy remains in slow growth mode, the baht continued to trade strong at around Bt30.24 to the US dollar yesterday.

 

Investors still see baht-denominated assets as a safe haven due to Thailand's high current account surplus. Thailand also has ample international reserves of $220 billion. 

 

The central bank has recently  cut its key interest rate to 1.25 per cent and introduced measures to encourage capital outflows but it has had little effect in reining in the baht.

 

“It doesn’t work, the central bank's move is too little and too late,” said Kobsithi. The stronger baht relative to other currencies has aggravated the problems of Thai exporters in selling their products given the global slowdown.

 

To strengthen the economy, we need structural reforms, Kobsithi suggested.

 

“Our ageing population means we are becoming more and more like Japan each day,” he said, adding that monetary stimulus will become less effective.

 

Source: https://www.nationthailand.com/business/30378478

 

-- © Copyright The Nation Thailand 2019-11-19

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[BuckBee]

sounds like dreaming or wishful thinking to me .

[mok199]

2 hours ago, webfact said:

To strengthen the economy, we need structural reforms, Kobsithi suggested.

 

The problem is ''structural''.......Thailand is dirty,old and worn out  , it has been pimped out to the max for years.....the air is brown and the beaches littered with garbage, but she had a good run....

[quadperfect]

Dont worry i read here that the american investors are standing in a big line outfront waiting to poor a tone of investment capital into youre lovely country. We will save thailand.

[RotBenz8888]

3 hours ago, webfact said:

the central bank's move is too little and too late

That's what everybody says.....now when it's already too late.

[rtco]

4 hours ago, webfact said:

Slow growth not reflective of Thai economic potential, says BOT official

Slow growth = this is a fact

Thai economic potential = this is a hope

[StayinThailand2much]

4 hours ago, webfact said:

Thailand’s economic outlook is better than what the current slow growth suggests, a central bank official said   (...)

What better economic outlook?

 

Low wages? Not anymore.

Low production/business costs? Not anymore. 

Competition in the region or worldwide? Duh! 

Attractive exchange rate? Pass!

Educated, qualified and well-trained workforce? Nope.

Foreign language skills? Arai na?

Modern infrastructure? What??

State investment/spending to counter the economic downturn? Negative.

Labor force to fill new vacancies? No, as, reportedly, the unemployment rate is well below 2%, and many are not willing to do certain jobs (factory work, construction, hospitality, or working at restaurants).

Positive business climate and business ownership rules? Never mind...

[Isaan sailor]

Looks like they’re too blind to see the correlation between a strong Baht—and a strong bilateral trading and military alliance with Communist China.

[khunpa]

All the same was said all over the World, just before the crash in 2008. 
 

When it looks bad around you and all the “wise-men” say don’t worry, then it is time to prepare.

 

[heybuz]

I seem to remember that they said a U.S China trade dispute was beneficial to Thailand.

[tomazbodner]

Of course it's not reflective of country's potential. The way things are going, 2.4% was pure good luck! Just take a look at the last quarter... 0.1% and dropping.

[Bruntoid]

7 hours ago, BuckBee said:

sounds like dreaming or wishful thinking to me .

Why ? Huge cash reserves are what drives a currency and right now Thailand has more dollars in reserve than the U.K. or Germany so called major powers - with only the big players above it - US, Saudi etc. 
 

 

[Srikcir]

11 hours ago, webfact said:

Slow growth not reflective of Thai economic potential, says BOT official

I agree!

2020 might prove to be even worse.

[Fex Bluse]

13 hours ago, webfact said:

Slow growth not reflective of Thai economic potential, says BOT official

My typical premature ejaculations are not reflective of my potential 

[Oziex1]

A couple of MoU's and the EEC should sort it. 

[Scot123]

10 hours ago, Bruntoid said:

Why ? Huge cash reserves are what drives a currency and right now Thailand has more dollars in reserve than the U.K. or Germany so called major powers - with only the big players above it - US, Saudi etc. 
 

 

And here it is again look, look Thailand great better than Great Britain, Germany etc we same as Saudi and USA.... OMG.... Let's get a few things straight Thailand is a 3rd world country and gets billions in handouts from the developed world every year. Thailand household dept and country's dept is massive. Who are you borrowing off to make the imaginary high-speed railway? The money is being borrowed but I do not see much progress in fact shouldn't it be almost finished. Things in Thailand can happen overnight. 

[kevin612]

I wish there is a second Tom yum gong crisis like 1997, the baht dropped nearly 1usd to 60 .

[champers]

36 minutes ago, kevin612 said:

I wish there is a second Tom yum gong crisis like 1997, the baht dropped nearly 1usd to 60 .

If it had a catastrophic effect on ordinary Thais would that bother you? I don't mean to direct that question to you alone, kevin612. I am interested to know what others would think; I think I might feel conflicted.

[Fex Bluse]

2 hours ago, champers said:

If it had a catastrophic effect on ordinary Thais would that bother you? I don't mean to direct that question to you alone, kevin612. I am interested to know what others would think; I think I might feel conflicted.

Would not bother me.

And it should not bother any farang.

Thais don't care about what happens to farang, so why would we care about what happens to Thailand?