Researchers Agree Flood Crisis To Hit Thai Economy Hard

[webfact]

Researchers agree flood crisis to hit economy hard

Seetalayajit Sabayjai

The Nation

Both local and international research houses predict that the floods will cause substantial damage to the Thai economy this year.

Somchai Jitsuchon, director of the Thailand Development and Research Institute (TDRI), said the government should establish a long-term flood-prevention system to ensure investors' confidence.

The TDRI expects losses from the nation's worst floods in decades will shave 1-2 percentage points off this year's growth in gross domestic product. The speed of economic recovery depends on how long the floods persist, he said.

If the massive flood water is released through the east of Bangkok without systematic management, damage is expected to be higher, as several industries are in that area, he said. Already many industries, particularly in the electronics and automotive sector, have been hit hard by the floods.

Siri Kancharoendee, a member of the Bank of Thailand's Monetary Policy Committee, expects the restoration to take about six months.

The MPC is ready to hold a special meeting if necessary and is monitoring the situation for monetary decisions in the future, he said. The policy-makers are scheduled to meet again on November 30.

Haver Analytics, a research house of Barclays Capital, said it had lowered its forecast for Thailand's GDP growth this year to 2.9 per cent, and raised it to 5.1 per cent for 2012.

"We are lowering our GDP-growth projection for Thailand to 2.9 per cent for 2011, from 3.7 per cent previously," it said. The change is on the back of expected flood-related losses of more than Bt100 billion and to factor in a further potential loss of activity.

The current fourth quarter of the year is likely to be the weakest quarter, and Barclays expects GDP to contract by 4 per cent quarter on quarter annualised, before recovering sharply in first half of 2012.

Based on an expected surge in reconstruction activity in the first half of next year and a low base, Barclays is revising upwards its 2012 growth forecast to 5.1 per cent, from 4.7 per cent previously.

"The risks to our revised 2011 projection are to the downside, given that the flood situation could deteriorate further," Barclays said.

The house believes that the BOT may consider providing monetary stimulus if there are no signs of an improvement in the economy by December, or if there is a lengthy delay in the government's fiscal response. "As such, while we retain our base case that the Thai central bank will not hike rates in 2012, we see the rising possibility of a rate cut going into the first quarter.

"Perhaps in a move to assuage market fears, Governor Prasarn [Trairatvorakul] came out a day after the MPC meeting [on Wednesday] and indicated that the central bank was ready to hold a special meeting and deliver monetary stimulus, if it appeared necessary. This, in our opinion, indicates that the BOT has no intention of changing its current policy course of rate normalisation but would be responsive to events."

Haver Analytics added, however, that it did not expect the likely GDP contraction in the current quarter alone to prompt any action by the BOT.

-- The Nation 2011-10-22

[endure]

"Researchers agree flood crisis to hit economy hard

Seetalayajit Sabayjai

The Nation

Both local and international research houses predict that the floods will cause substantial damage to the Thai economy this year."

Presumably all these folks have graduate degrees in stating the bleeding obvious?

[janverbeem]

Now it only waiting for some bigwig from PTP to announce that the economy is unaffected by the floods, and in fact it's growing.

[scotbeve]

Now it only waiting for some bigwig from PTP to announce that the economy is unaffected by the floods, and in fact it's growing.

I thought that was a Dem ploy whilst stealing from the cookie jar...

[kennalder]

"Perhaps in a move to assuage market fears, Governor Prasarn [Trairatvorakul] came out a day after the MPC meeting [on Wednesday] and indicated that the central bank was ready to hold a special meeting and deliver monetary stimulus, if it appeared necessary. This, in our opinion, indicates that the BOT has no intention of changing its current policy course of rate normalisation but would be responsive to events."

Well if they couldn't see a wall of water 2 months out, do we really think they can time economic stimulus?

[plumeria]

"Researchers agree flood crisis to hit economy hard

Seetalayajit Sabayjai

The Nation

Both local and international research houses predict that the floods will cause substantial damage to the Thai economy this year."

Presumably all these folks have graduate degrees in stating the bleeding obvious?

Yeah, like so much "news" these days. Close you eyes and make something up vague and general then present it in pompous or somber tones with good inflection and you've got modern TV news.

It's so bad it is beyond insulting to everyone's intelligence. Probably more in the ludicrous but maybe almost into the insipid category.

[FalangBaa]

"Researchers agree flood crisis to hit economy hard

Seetalayajit Sabayjai

The Nation

Both local and international research houses predict that the floods will cause substantial damage to the Thai economy this year."

Presumably all these folks have graduate degrees in stating the bleeding obvious?

Yeah, like so much "news" these days. Close you eyes and make something up vague and general then present it in pompous or somber tones with good inflection and you've got modern TV news.

It's so bad it is beyond insulting to everyone's intelligence. Probably more in the ludicrous but maybe almost into the insipid category.

Your avatar is extremely annoying and is hypnotizing me. Change it na krap!

[frogz]

"Researchers agree flood crisis to hit economy hard

Seetalayajit Sabayjai

The Nation

Both local and international research houses predict that the floods will cause substantial damage to the Thai economy this year."

Presumably all these folks have graduate degrees in stating the bleeding obvious?

Yeah, like so much "news" these days. Close you eyes and make something up vague and general then present it in pompous or somber tones with good inflection and you've got modern TV news.

It's so bad it is beyond insulting to everyone's intelligence. Probably more in the ludicrous but maybe almost into the insipid category.

Your avatar is extremely annoying and is hypnotizing me. Change it na krap!

[frogz]

I was thinking about the long term affects. Most of the rice has gone from the supermarkets and I believe this year's crops have been affected by the flooding. As the biggest exporter of rice in the region there are going to be far more people affected by these floods than just people in Thailand. The price of food will obviously rise around the region and Thailand will have to import rice to feed the people. This means a rise in food prices which will impact on the rice famers that have been the worse affected.

The floods may be gone in four to six weeks but the affects will be with us for sometime to come I feel.

[ozzieman05]

Now it only waiting for some bigwig from PTP to announce that the economy is unaffected by the floods, and in fact it's growing.

I thought that was a Dem ploy whilst stealing from the cookie jar...

We all know what Thought Thought

He think his foot is out of bed

so he must get out to have a look