BoT: private sector waiting for global economic recovery, state investment

[webfact]

BoT: private sector waiting for global economic recovery, state investment
By Digital Content



BANGKOK, Feb 2 -- Recovery of domestic consumption and private investment in Thailand is still slow as the private sector is still waiting for global economic recovery and massive government investment on basic infrastructure projects, said Don Nakornthab, director of the Bank of Thailand (BoT) Macroeconomic Policy Office.

Mr Don painted a gloomy picture of the Thai economy as last year it grew only 0.8 per cent while the central bank projected that this year’s gross domestic product would expand 4 per cent.

The economy in December recovered sluggishly due to slower than projected domestic consumption although global oil prices declined sharpl Agriculture-related incomes remained low while debts were high.

Sales of durable goods, especially cars and houses were inactive.

Thailand’s exports during the calendar year 2014 contracted 0.3 per cent while it is expected that exports this year will rebound and grow 1 per cent.

Statistics issued by the Bangk of Thailand showed that domestic unemployment in December remained low, with inflation falling and the current accounts enjoying a surplus of US$5.5 billion due to the sharp decline in global oil prices and the strengthening of the Thai currency, the baht. (MCOT online news)


-- TNA 2015-02-02

[Pib]

"BANGKOK, Feb 2 -- Recovery of domestic consumption and private investment in Thailand is still slow as the private sector is still waiting for global economic recovery and massive government investment on basic infrastructure projects, said Don Nakornthab, director of the Bank of Thailand (BoT) Macroeconomic Policy Office."

Hope the private sector has a comfortable chair to rest in while waiting for the recovery & govt investment as the wait could be a year or two (or more).

[Utley]

This is the first time I believe what the BOT is saying; rather sad that.

[rickirs]

“Recovery of domestic consumption and private investment in Thailand is still slow as the private sector is still waiting for global economic recovery and massive government investment on basic infrastructure projects”

After eight months the Military Government has still FAILED to deliver the economic stimulus it PROMISED to improve the economy. Government investment in Thailand is a recognized necessity for reversal of negative economic growth:

“The only hope to revive growth is through government spending on the mega-infrastructure projects” The Nation 2014-08-29

Kritsada Jinavijarana, the director-general of the Fiscal Policy Office - “the reason for the increase for 2015 will be due entirely to the proposed massive government spending in infrastructure projects and the ever improving tourism sector.” 2015-01-30

Sutapa Amornvivat, chief economist of SCB - “The military government's infrastructure projects and surging demand from neighbouring countries will help add half a percentage point to that 3-per-cent figure, bringing the potential for annual growth of gross domestic product to 3.5 per cent.” The Nation 2015-01-30

Pridiyathorn Devakula, deputy prime minister in charge of the economy said that "A GDP expansion of 4 per cent in 2015 is definitely achievable and the government's job is to increase its spending on investment. The Nation 2015-01-15

Chantana Sukumanont, an adviser to Siam City Cement said that "If there's no ground-breaking [on government investment projects], I do not believe in anything. One recommendation I have for the government is to 'just do it'. There's enough talk already," The Nation 2015-01-30

The military controls the nation’s treasury, the legislature, and the government. It cannot be recalled or charged for dereliction of duty. It is not subjected to any regulatory agency or public opposition. Delivering on its economic policy should be a no-brainer. And yet to date, its biggest infrastructure project (dual rail system) was financed primarily by borrowing from the Chinese, not from the Thai treasury. What is it waiting for?

The answer may lie with an ultra-conservative NCPO whose military life-style has been largely insulated from economic pressures that face the rest of the nation. Successive elected governments only hesitated to meet military budgetary demands. The military has been and continues to be out of touch with the myriad economic forces that affect the Thai people, offering mostly “gifts, limited short-term subsidies, and platitudes of hope as its economic policy. The military government is subconsciously looking solely to domestic consumption (something the generals are familiar with) to save the Thai economy despite all the experts advice:

“The government could come under pressure to shift the economy out of idle, but gross domestic product should grow on its fundamentals, not from an injection of capital” - Somkid Jatusripitak, NCPO Advisor, The Nation 2014-11-20

[farangmick]

Thailand is still acting like a third world country. The massive duty charged on foreign imports, especially from the west, should be reciprocated. I can just about understand the protectionist attitude on products that are made or cultivated in Thailand, But why hammer goods such as proper motorbikes, which are bought by a tiny minority and bring in almost nothng in excise revenue? On a more prosaic note, would the Thai economy collapse entirely without the duty on corned beef and Branston pickle?