More measures needed for an economic turnaround 

By Wichit Chaitrong
The Nation

 

Public investment and private investment grew 3.7 per cent and 2.4 per cent respectively in the third quarter, according to the National Economic and Social Development Council.

 

Economists see more government stimulus packages in the pipeline amid the bleak economic outlook for next year.

 

“The government should be credited for the latest economic stimulus package as it would at least shore up growth this year,” said Charl Kengchon, executive chairman at Kasikorn Research Centre.

 

His comment comes as the Cabinet on Tuesday approved economic packages targeting farmers, villagers, homebuyers and property developers. Finance Ministry estimated the package would inject about Bt144 billion into the economy with Bt80 billion in the next 3-4 months.

 

The government expected the package to shore up economic growth to 2.6 per cent this year, after a mere 2.4 per cent in the third quarter.

 

Charl, said economic impact of the latest package would not be significant this year as there is only a few week left. Government spending has been constrained, pending the passage of the fiscal 2020 budget by parliament early next year. The government would start public investments, if the proposed budget is approved, he said.

 

Economic outlook remain bleak as major economies such as US, China, Japan would continue to face growth deceleration next year,according to projection by the International Monetary Fund, he said.

 

For Thailand, economic growth would be at 2.5 per cent this year and 2.7 per cent next year, he said. The Thai economy largely depend on exports, and we need to monitor world trade and impact from the US-China trade conflicts, he said.Thai exports contracted 4.5 per cent in October. 

 

If the two countries could reach a trade deal this year as expected, it would still take sometime before the global economy returns to normal, he said, adding that Thai exports next year might recover to a certain extent.

 

Somprawin Manprasert, executive vice president and head of research at Krungsri Bank said that it was not sure yet how the latest stimulus package would help small and medium-sized enterprises hard hit by falling exports.

 

He forecast exports to contract by 2.5 per cent this year and may grow 1.5 per cent next year.

 

“Global economy may be better than the Thai economy next year,” he said.

 

“Central banks in major economies have implemented monetary easing measures to stabilise their economies, but they may not be strong enough to pull our economy out of a slowdown,” he said.

 

Krungsri forcast Thai GDP growth at 2.4 per cent this year and 2.5 per cent in 2020. The growth rate is lower than the full potential of 3.5-3.8 per cent, Somprawin added. Public spending on infrastructure projects may start to enter the economy in the second half of next year but it would take time to gather momentum. Currently private investment remains at a low level and consumption flat, he said. 

 

Public investment and private investment grew 3.7 per cent and 2.4 per cent respectively in the third quarter, according to the National Economic and Social Development Council.

 

The government may need to offer tax incentives for the middle income group to spend more, he added.

 

Meanwhile, Lavaron Sangsnit, director general of the Fiscal Policy Office, is more optimistic, saying that the latest package would inject about Bt144 billion into economy. For example the cash back offer of Bt50,000 for 100,000 potential home buyers would help to clear up the inventory of about 270,000-280,000 residential units. Property developers could start investing again, he said.

 

Previous measures such as cash handouts via welfare card scheme, income guarantee for farmers and local tourism stimulating package have somewhat failed to spur private consumption, he said, referring to the 4.2 per cent growth in private consumption in the third quarter.

 

Source: https://www.nationthailand.com/business/30378785

 

-- © Copyright The Nation Thailand 2019-11-27

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14 minutes ago, webfact said:

The government may need to offer tax incentives for the middle income group to spend more, he added.

Do not worry the touted 39 million tourists coming in will kick the figures along.

The people are pisssssssed/disenfranchised... baht aside, there is only one measure needed.

1 hour ago, webfact said:

Previous measures such as cash handouts via welfare card scheme, income guarantee for farmers and local tourism stimulating package have somewhat failed to spur private consumption, he said, referring to the 4.2 per cent growth in private consumption in the third quarter.

Really?

The guys in charge of the economy are a lot like many Thai drivers.

Asleep at the wheel.

There is a global recession presently in the making. Throwing a bit of helicopter money about is not going to give Thailand immunity from that. 

As part of the stimulus package over 70,000 villages will receive 200,000 baht each for "local projects". There is sure to be some smiles all round when that non accountable 14 billion baht hits the honey pots of those administering these so called local infrastructure projects.

 

3 minutes ago, Cadbury said:

There is a global recession presently in the making. Throwing a bit of helicopter money about is not going to give Thailand immunity from that. 

As part of the stimulus package over 70,000 villages will receive 200,000 baht each for "local projects". There is sure to be some smiles all round when that non accountable 14 billion baht hits the honey pots of those administering these so called local infrastructure projects.

 

I agree there's a global recession in the making and I agree that Thailand will not be immune. But I don't agree that a consumer led recover will not work, regardless of who those consumers are. If you pour free money into an economy it has a positive and a negative effect, as we saw when many central banks around the world started printing money. The positive effect of what Thailand is doing is that the money supply will increase and benefit the poorest people from the bottom up. The negative effect is that the job creators will not benefit from that giveaway hence it's more like first aid than restorative surgery.

2 hours ago, webfact said:

“The government should be credited for the latest economic stimulus package as it would at least shore up growth this year,” said Charl Kengchon, executive chairman at Kasikorn Research Centre.

Yes, let’s all credit the government. Well done, government! You may have made a bad situation even worse, but let’s not talk about that. Let’s congratulate you on throwing tax-payers money at a problem. 

3 hours ago, webfact said:

“The government should be credited for the latest economic stimulus package as it would at least shore up growth this year,” said Charl Kengchon, executive chairman at Kasikorn Research Centre.

theyve  had 5  frikking  years theyve wasted already

1 hour ago, Creasy said:

The guys in charge of the economy are a lot like many Thai drivers.

Asleep at the wheel.

not  only have the brakes  failed  but the wheels  have  fallen off.............still that leaves them a hub to play with, and  we  all know its  the king of  hubs

Were going to need a bigger HUB...

I don't see what the problem is.....I have just read that ;

" Pattaya hotel overall occupancy rate is at 80% ".

" Pattaya continues to attract some 450,000 visitors daily , the top Three tourists groups being the Chinese , Indians and Russians ".

" Average spending for Indian tourists is 10,000 baht a day , compared to 5,000 baht for Chinese visitors ".

 

They are very impressive figures.

 

18 minutes ago, NE1 said:

I don't see what the problem is.....I have just read that ;

" Pattaya hotel overall occupancy rate is at 80% ".

" Pattaya continues to attract some 450,000 visitors daily , the top Three tourists groups being the Chinese , Indians and Russians ".

" Average spending for Indian tourists is 10,000 baht a day , compared to 5,000 baht for Chinese visitors ".

 

They are very impressive figures.

 

figures  supplied by  the tooth  fairy

I think three of the headlines on this site say a lot more than some mouthpiece from Kasikorn Research Center:

 

• More Measures Needed for an Economic Turnaround.
• New Measures Out to Boost Economic Growth.
• Thai Economy: Thais Staying Home and Not Going Out to Eat

They can 2.4, 2.5, 2.6 and 3.7% the public until the cows come home.  I can tell you it will snow in Bangkok tomorrow.  And then I can blame anyone but myself when it doesn't.  Predictions, forecast, and charts mean nothing when reality burns down speculation.  People are suffering financially while the people who benefit the most financially are busy patting themselves on the back.     

 

 

4 hours ago, webfact said:

 

Previous measures such as cash handouts via welfare card scheme, income guarantee for farmers and local tourism stimulating package have somewhat failed to spur private consumption

???? We have read nonstop government ministry pronouncements that the Eat, Shop, Spend, Beg schemes have been wild successes. 

 

Isn't the government now considering a round 47, or something, of the scheme? 

 

This guy is in big trouble for contradicting the government. He better pack his luggage. 

 

"Sale extended due to overwhelming success"

Cancel the subs.

6 hours ago, webfact said:

He forecast exports to contract by 2.5 per cent this year and may grow 1.5 per cent next year.

I'm confused. -6.1%, -7.9%, -1% so far this year, for a simplistic average -2.5%, the last qtr would have to be about a 5% growth. I can't see that happening.

 

 

Not once has a military dictatorship produced a growing economy, not once. Thailand had (I think) 15 years of stability but the elite were losing their power. Since 2006 the country has stagnated and regressed. It is so very sad. A beautiful country that had so much money poored into it by USA and should be sitting like South Korea or Japan but instead it is sitting closer and closer to Nk all the money pouring into a few families pockets. It is so sad. 

12 hours ago, webfact said:

More measures needed for an economic turnaround

Or simply stated: a new government.

18 hours ago, webfact said:

Krungsri forcast Thai GDP growth at 2.4 per cent this year

This forecast is already DOA.

For the average annual GDP growth rate to hit 2.4, the fourth quarter rate must be 3.1.

Simply not going to happen.