Thai July economy improves but foreign tourist ban a big drag

By Orathai Sriring, Kitiphong Thaichareon

 

FILE PHOTO: Thailand's central bank is seen at the Bank of Thailand in Bangkok, Thailand April 26, 2016. REUTERS/Jorge Silva/File Photo

 

BANGKOK (Reuters) - Thailand’s economy improved in July, helped by public spending and an easing of coronavirus containment measures, but tourism suffered from a continued border closure, the central bank said on Monday.

 

July’s private consumption rose 2.7% from June as activity resumed, while annual exports shrank at a smaller pace of 11.9%.

 

“Looking forward, there are still high uncertainties,” Don Nakornthab, a director at the Bank of Thailand (BOT), told a briefing.

 

Most uncertain are foreign tourist numbers, which could miss the central bank’s projection of 8 million, he said.

 

Thailand could at best have 6.7 million foreign visitors this year, as projected by the state planning agency and the finance ministry, meaning 1.3 million fewer tourists than the BOT’s forecast, affecting GDP by 0.5%, he said.

 

BOT Governor Veerathai Santiprabhob told Reuters on Friday the BOT’s forecast for a record 8.1% economic contraction this year could be “optimistic”. The BOT will review that next month.

 

The tourism-reliant country received 6.69 million international tourists in January-March but the influx ended on April 4 when Thailand imposed a ban on foreign vacationers to keep the coronavirus out.

 

That compares with last year’s record 39.8 million visitors whose spending made up about 11.4% of GDP.

 

From October, Thailand will allow foreign tourists on the island of Phuket for long stays, with a quarantine.

 

In July, Thailand had a current account surplus of $1.79 billion after a trade surplus hit a five-month high of $4.11 billion, driven by higher gold exports.

 

The central bank has said gold shipments add upward pressure on the baht. THB=TH. Veerathai said the BOT should "very soon" relax rules on foreign currency deposits "to make sure that gold trading will not have an unnecessary impact on exchange rates".

 

“The use of foreign currency deposits in gold trading in U.S. dollars is one example,” he said, adding Thais could also keep savings in foreign currency deposits.

 

-- © Copyright Reuters 2020-08-31

 

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9 minutes ago, snoop1130 said:

could miss the central bank’s projection of 8 million,

 

9 minutes ago, snoop1130 said:

 

Thailand could at best have 6.7 million foreign visitors this year, as projected by the state planning agency and the finance ministry, meaning 1.3 million fewer tourists than the BOT’s forecast

Bring on the archers .. 

 

Edited August 31, 20206 yr by Justgrazing
Picture

Is there 6.7 million foreign visitors this year willing to be locked up prodded and fleeced at extraordinary cost queuing up to come let us see ????   

The tea leaves say no 8 million but definitely 6.7. They so smart

6 minutes ago, Justgrazing said:

 

Bring on the archers .. 

 

Is that Jeff Grundy?

 

7 minutes ago, bluesofa said:

Is that Jeff Grundy?

 

could be John Mundy for as much chance of them hitting their target ..

 

and he's been dead over 300 yrs .. 

33 minutes ago, snoop1130 said:

That compares with last year’s record 39.8 million visitors whose spending made up about 11.4% of GDP.

Well, assuming this is reasonably accurate, this is going to be a harsh economic outcome :

- If no reopening this year, foreign tourism will be down >80% vs 2019 (borders shut April) : -9% GDP (-80% * 11.4%)

- Some positive offset with Thais/expats vacationing in-country : +3% GDP (estimate)

- Other negative economic impacts across a range of sectors : -5% GDP (estimate)
 

I reckon we could be looking at >-10% GDP contraction for the full year.

Will be interesting to see the Q3 economic data when released.

QUOTE: That compares with last year’s record 39.8 million visitors whose spending made up about 11.4% of GDP.

 

NO.

11,4% compared to GDP, not 11,4 of GDP.

And didn't I always hear 18%?

41 minutes ago, Cali farong said:

The tea leaves say no 8 million but definitely 6.7. They so smart

So they expect only 10000 more this year!

 

56 minutes ago, snoop1130 said:

The tourism-reliant country received 6.69 million international tourists in January-March but the influx ended on April 4 when Thailand imposed a ban on foreign vacationers to keep the coronavirus out.

So if somebody want to come coundry go for this Phuket option! Can forget every other dream to come here!

I’m ready to hoop jump and stay as long as I can but I wonder if they’ll let a 29 year old American in.

1 hour ago, Justgrazing said:

2 hours ago, bluesofa said:

Is that Jeff Grundy?

could be John Mundy for as much chance of them hitting their target ..

 

and he's been dead over 300 yrs .. 

What do I know, maybe Joe Grundy? He died last year.

6 hours ago, snoop1130 said:

BOT Governor Veerathai Santiprabhob told Reuters on Friday the BOT’s forecast for a record 8.1% economic contraction this year could be “optimistic”. The BOT will review that next month.

8.1% I would say is extremely, extremely , extremely optimistic - with exports down 10-20% and tourism down 80%.

 

If they shut down Thailand for another 6 months, I think a safe minus 15-20% contraction is well on the cards

What?  What?  where's the beets?

What?  What?  

 

10 hours ago, snoop1130 said:

 

From October, Thailand will allow foreign tourists on the island of Phuket for long stays, with a quarantine.

They need to fleece those 100 tourist really bad to make a difference on the overall economy... 

Why would any person want to holiday in Thailand knowing they would have to spend mega baht for a fourteen day enforced quarantine? Letters being covid free, not allowed off the island.  I just don't get Thai logic.  Then again maybe my logic is flawed, yet I don't think so.

54 minutes ago, lujanit said:

Why would any person want to holiday in Thailand knowing they would have to spend mega baht for a fourteen day enforced quarantine? Letters being covid free, not allowed off the island.  I just don't get Thai logic.  Then again maybe my logic is flawed, yet I don't think so.

T.A.T and sports ministers logic is flawed, they think the rest of the world is gagging to get back into Thailand as they have nothing else to do, "newsflash" they have other issues to contend with now.

Edited September 1, 20206 yr by hotchilli

Congrats to Euro and British tourists and expats.  Currency traders have jacked up your money, at the expense of the downtrodden USD.  You won’t see many American tourists coming—but you probably never did...

Edited September 1, 20206 yr by Isaan sailor

I'm no Financial Expert but i can never see how 'Public Spending' helps an economy when all the money for that Public Spending is borrowed ?   Am i just a Dimwit or what ?    Tin Helmet and Gas Mask on !

23 hours ago, Isaan sailor said:

Congrats to Euro and British tourists and expats.  Currency traders have jacked up your money, at the expense of the downtrodden USD.  You won’t see many American tourists coming—but you probably never did...

The pound is very low against both the dollar and baht.