K-Research to revise up GDP projection



BANGKOK, 18 June 2014, (NNT) - Kasikorn Research Center has said the National Council for Peace and Order (NCPO)’s economic stimulus plan will significantly improve the national Gross Domestic Product (GDP), as well as the performance in the credit market.

According to Kasikorn Bank’s Deputy Managing Director Pakorn Pattanapat , the NCPO’s economic stimulus plan will attract more capital to the local market while restoring consumer confidence and stimulating spending.

If it goes as planned, the plan could push Thailand’s GDP growth this year to 2%, up from 1.8% projected earlier.

Mr. Pakorn said the improvement would also strengthen the credit market, adding that the bank planned to issue about 700,000 new credit cards this year, bringing the total number of Kbank's credit cards to 3.6 million, an increase of 16% year-on-year.


-- NNT 2014-06-18

FPO Director-General Somchai Sajjapongse recently stated that the total net revenue collected in the first eight months of the fiscal year is 6.4 percent lower than the original target mainly due to lower personal income tax and the economic slowdown. And now the Kasikorn Bank’s Deputy Managing Director Pakorn Pattanapat expects to see a 16% increase in Kbank's credit cards (aka consumer debt) just on the heals of worker immigrants leaving Thailand en mass. Yet, Kasikorn Research Center projects Thailand’s GDP growth this year to 2%, up from 1.8% projected earlier. Compare this to the 2.9 percent increase in the Thai economy for 2013 (ref. "Bloomberg," Feb 17, 2014 ).

Rather than focus on cheerleading economic projections, the country needs balanced economic strategies that attends to both domestic and foreign growth while holding down government expenditures and increasing revenues. This will mean in part that Thai banks must do their part in holding down consumer debt at the cost of decreasing bank revenues; if not voluntarily, then by regulation.