22 minutes ago, Brunolem said:

This is not my point.

 

My point is that the forecasted GDP growth is not the result of a real and sound economic recovery, but of massive government intervention.

 

Part of the issue lies in the definition of GDP, which only takes into account the assets side of a country's balance sheet.

 

If one was to also take into account the liabilities side (debt), one would quickly discover that, for most countries there is no actual growth (increase of assets - increase of liabilities), and for many there hasn't been for years, or even decades.

 

GDP, by definition, does not include debt although it is a net figure. By that I mean it does not include budget deficit debt that has been sold as bonds.

 

What you wrote about no growth for many years is patently false. In the case of Thailand, debt has DECREASED whilst GDP has increased, for many years, only the pandemic in very recent times has changed that. See the debt to GDP

chart: https://www.pdmo.go.th/en

 

The GDP contraction in 2020 is estimated to be about 6.5% of GDP.

 

https://www.worldbank.org/en/country/thailand/publication/key-findings-thailand-economic-monitor-january-2021-restoring-incomes-recovering-jobs

 

Government spending on covid in 2020 was financed by the budget deficit which is estimated currently to be 5.9% of GDP. Your statement about government spending wiping out any GDP growth may apply to the highly unusual covid years but but outside of that is also patently false.

 

You see to be talking round in circles and looking to support an argument that doesn't really exist outside of the covid years.

 

 

Edited May 9, 20215 yr by Brierley

29 minutes ago, Brierley said:

 

What you wrote about no growth for many years is patently false. In the case of Thailand, debt has DECREASED whilst GDP has increased, for many years, only the pandemic in very recent times has changed that. 

I was not specifically talking about Thailand, since I wrote "most" and "many countries".

 

Thailand, and East Asia in general, certainly had real growth (net of debt increase) since the beginning of this century, but Western countries, starting with the US, didn't.

 

When a country borrows (prints) 3 or 4 dollars to get 1 dollar of extra GDP, it's economy is not really growing, but rather heading to bankruptcy.

 

And this doesn't even take into account the GDP deflator (inflation) which is vastly underestimated in most countries.

 

When GDP "growth" runs at an anemic rate of 1 to 2% per year, an underestimation of the inflation rate can easily make the difference between growth and contraction.

On 5/8/2021 at 3:24 AM, webfact said:

Thailand's economy is likely to grow more than the forecast of 2.3% this year, helped by new relief measures

IMO that is achievable considering forecast is measured against last year approx 10% contraction. The positive forecast albeit lower than ADB’s forecast of ASEAN peer countries can be contributed by the stimulus package, recovery in major trading countries, benign low inflation and large scale vaccination post June. Decline in tourism Baht has been factored in the forecast. Still contingent upon how well the government handle the vaccination drive. 

44 minutes ago, Eric Loh said:

IMO that is achievable considering forecast is measured against last year approx 10% contraction. The positive forecast albeit lower than ADB’s forecast of ASEAN peer countries can be contributed by the stimulus package, recovery in major trading countries, benign low inflation and large scale vaccination post June. Decline in tourism Baht has been factored in the forecast. Still contingent upon how well the government handle the vaccination drive. 

The GDP contraction in 2020 is estimated to be about 6.5% of GDP.

 

https://www.worldbank.org/en/country/thailand/publication/key-findings-thailand-economic-monitor-january-2021-restoring-incomes-recovering-jobs

This is a good site to understand how some things work.. http://www.shadowstats.com/