Thailand's growth forecast raised

[george]

Thailand's growth forecast raised

BANGKOK - Thailand's central bank has raised its economic growth forecast for 2003 to 5.75-6.25% from an earlier projection of 4.5-5.5%.

Bank of Thailand assistant governor Bandid Nijathaworn said it had also raised its Gross Domestic Product (GDP) forecast for 2004 to 5.5-6.5% from 5.0-6.0% earlier.

"In the first nine months (of the year) economic growth continued and there is momentum for further growth through the end of this year and into next year," he told a news conference.

The revision brings the central bank roughly in line with Thailand's National Economic and Social Development Board, which last month upped its 2003 GDP growth forecast to 5.8-6.2% from 4.5-5.5%.

The central bank tipped core inflation this year to come in at nearly zero, down from a previous estimate of zero to 0.5%

but maintained a forecast of zero to 1.0% in 2004.

Thailand's current account surplus this year is seen at 7.0-8.5 billion dollars rather than 6.0-7.5 billion dollars, while export growth is tipped at 12.5-14.5% this year against 9.0-11.0 percent earlier, Bandid said.

Import growth in 2003 is expected to reach 12.5-14.5% compared with 9.5-11.5%, he said.

The World Bank earlier this month raised Thailand's 2003 economic growth forecast to 5.8% from an earlier estimate of 4.5%, citing a "strong and impressive" economic performance over the past six months.

The International Monetary Fund also said in September that it expects Thailand's GDP growth to hit 5.0% this year after 5.3 percent in 2002.

--AFP 2003-10-30

[Butterfly]

Wasn't it the number Toxin announced a few months ago ?  

[KenUdon]

Butterfly..you know that is just coincidence....

[davidm]

The report is the usual complete and utter rubbish that local institutions feel compelled to issue on a regular basis to make up for the lack of real news. I had the misfortune to cover the Thai economy for a few years and soon discovered just about everything that's published is made up.

There are no reliable figures concerning the Thai economy. Period. If you don't believe me, try visiting a few government agencies, such as the Department of Export Promotion or the Port Authority of Thailand and get some statistics for the previous quarter. Or ask an industry association the same question.

Without dependable statistics, everything regarding economic reports becomes unreliable.

[Butterfly]

The report is the usual complete and utter rubbish that local institutions feel compelled to issue on a regular basis to make up for the lack of real news. I had the misfortune to cover the Thai economy for a few years and soon discovered just about everything that's published is made up.

There are no reliable figures concerning the Thai economy. Period. If you don't believe me, try visiting a few government agencies, such as the Department of Export Promotion or the Port Authority of Thailand and get some statistics for the previous quarter. Or ask an industry association the same question.

Without dependable statistics, everything regarding economic reports becomes unreliable.

Don't worry, most "real" investors already know it's all BS. Just look around and see if this country is "really" growing at 7% or even 6% ? see what I mean ?

however, the "amateur" and "overseas" investors get sucked up into those numbers and follow the herd to the slaughter house. Kind of nice actually.

This is the same with the property market. They keep building new condos but what about all the vacant ones ? rent in BKK is cheap so why buy and lose money on your property with such an illiquid asset ? Same with the currency risk. Another 1997 crash and your 1m bath condo investment become worthless when you have to buy back your currency or suddently live in a country where prices go up 100% to make up for the currency devalualtion.

I found a "strange" trick the other day in some company annual report. The were announcing year 2003 (FY0) EPS already in 2002 to the bath. How could they have known 1 year prior, precisely to the bath, EPS for 2003 ? Some companies have already reported 2003 and this is not an estimate. Kind of strange, isn't it ?

[Fabian]

Some companies have already reported 2003 and this is not an estimate. Kind of strange, isn't it ?

Maybe they have a business year ending on, for example, the 30th of june?

[Rolling Stone]

Do that many westerners invest in the Thai SET market? I always thought of it as the same as the OTCBB in the US IMHO. The floats are astounding.

With so many safer investments out there why invest in small SE Asian markets? It just seems like a very risky environment, I have no faith in the banking system here let alone the market.

Keep it real!

[pnustedt]

why invest in small SE Asian markets? 

Because the returns are better.

The SET has substantially outperformed US and European markets over the past three years.

I do not have the expertise to invest in the SET directly but buy mutual funds - two of the best performing funds in my portfolio over the medium term ae Thailand and S. Korea.

[Rolling Stone]

pnustedt thanks for the reply. I guess you are right if you are mutual fund investor. I agree on an overall basis those markets have outperformed, but buying for gains and shorting in the US markets has been extremely good too in the last year. Have to spend the time reading charts and watching for the momo's trying to ride them up then short them down but I get a kick out of it. Good luck to you.

Keep it real!

[Butterfly]

Some companies have already reported 2003 and this is not an estimate. Kind of strange, isn't it ? 

Maybe they have a business year ending on, for example, the 30th of june?

yeah sure, many do but that's not what I am saying. In 2002/06 they will already report 2003/06 to the Thai Bath. And then in 2003/06 that number would be exactly the same number they reported a year before for 2003. Strange, isn't it ? I think they all have it done in Excel and don't bother recounting all their earnings from their estimate

[morphic]

I have a bit in the Thai stockmarket via an exchange traded fund. It has done very well and although I have reduced my position, I am still in. But I am under no illusions; its a momentum play. At some point the economy and market will start to come apart at the seams. These growth rates are partially fabricated, in my opinion, using Enron style accounting, and partially ture, but based upon the benefit to private companies, like Siam Cement, of vast numbers of publicly funded and corrupt building projects. What I don't see is anything fundamental that will maintain economic growth once Thaksin, inevitably, runs out of money. His grandiose schemes cost and pay day will come. When that happens, make sure you're not last to the exit when the party ends and the roof comes crashing down.

The 64 million dollar question is : when?

[Guest ka1234]

The SET has substantially outperformed US and European markets over the past three years.

Correct, up 250% since the low in 2001 and up 85% since march this year. Isn't there something fishy about that?

One company I held stock in are currently trading at levels higher than their pre-1997 highs. This despite that they have diluted their stock and sold off assets (land, buildings, subsidiaries) to pay off debts. On top of that, invested in subsidiaries that don't earn a satang (but some of that is cleverly hidden thanks to more flexible accounting rules).

It feels like there is something fishy is going on with the SET. My guess is hype, speculation and mass hysteria. Will it burst like a ballon or deflate slowly and peacefully?

http://www.set.or.th/static/market/market_u13.html