Thailand’s economic outlook worst in 40 years

[Robert24]

Hey Thailand welcome to the rest of the world.

I do hope you quit supporting the Thai baht so much, and let it slump a bit

toward the real value of Baht versus USA dollar.

Just saying!

What is USA govt debt to gdp now? 80%? 85? Go look up Thailand and understand why the USD is so weak.

the $ has been strong (not weak) against most other currencies including the Thai baht. Have a look at $ index chart in post 120.

Currency valuations have little correlation to the debt to GDP ratios.

[Lunchbob]

It's going to take a while to get the BRICS and ASEAN engines working. Consider it a few years to get things in order, your farm, redefinig your business, deal with your debt, etc...Whatever you do, do not sell your land.

[Robert24]

"if exports grow by 0.4 percent, the growth rate will be 3.2 percent"

NO

Exports account for 70% of Thailand's GDP. If exports by value grow by only 0.4%, then 70% of the TOTAL GDP grows by 0.4% .

In order for the Total GDP growth rate to achieve 3.2%, the three factors of the Thai economy (domestic consumption, government spending, tourism) for the remaining 30% of the GDP must grow 10%. Domestic consumption is constrained by increasing historical levels of household debt; government investment in the economy has been restrained; and tourism is unpredictable at best. If any of the remaining economic three factors fall short of 10% growth, a higher growth rate beyond 10% must be achieved.

Unless exports drastically increase by mid-year 2015, Thailand is facing deflation.

I can follow the logic in what you are saying with exception of your last sentence that if exports not grow a lot that this would lead to deflation. Can you articulate how you come up with this conclusion? What is the correlation of inflation or deflation to the growth of exports?

[EricBerg]

The Thai baht, its goods and many services are overvalued by 30% or so.

Much more than that. 50% is more likely. And the coin will drop significantly at some point.

[barmatt]

Oh please please please crash and make my happy endings happier

[issanaus]

Do they have maths teachers in Thailand, because nobody seems to come up with the same numbers, and they change by the day

The most variable factor in economic demand is confidence - consumer and business. In any given market at any given time there are changes in individual expectation. The individual change is not that important as it is the net change that matters (Bull v Bear). Modelling for change in confidence is very difficult and more so in countries where there is political,security and economic uncertainty.

One of the many structural problems in Thai economy is the dependence on exports especially where the exports are in a price taker market as is the case Agricultural sector. Economic Modeling in that sector is further complicated by the effects of climates not only in Thailand but also in the countries that supply in that market. Amongst the issues that effect the overall balance between price taker/price setter production is access to innovation and quality of production - unfortunately Thailand comes out poorly in this regard and it is one of the reasons why Thailand remains more exposed to the unpredictable changes in International prices.

One of the issues that makes economic modelling in countries such as Thailand is that of the informal and black economies. Anyone care to hazard a guess as to the size of the drug trade or corruption in Thailand. Both of those issues would need to be factored in to economic modelling in Thailand because they are significant issues. Economic modelling is only as good as the information that input in to the system - the formulas are relatively simple.

20 years ago when I was more 'engaged' in economics it was a know fact that the economic model used by the Australian Government could only accurately model 60% of the economy. I would hate to guess how bad the economic modelling is in Thailand.

Just a few points for you consideration - not an attempt to comprehensively address the problem you raised

[KamalaRider]

No peg with the US$. As previously mentioned, the baht has weakened considerably against the US$ from 29 to now above 32. The problem is the baht relative strength to other Asian currencies and the Euro.

Stop telling people the exchange rate was 29 TBH for one US$, I'm getting paid in US$ and during three years now, the US$ have never been lower than 31 except for a quick drop at one point but BoT quickly called in the troops.

April 21 2013, 28.76.

http://www.oanda.com/currency/historical-rates/

I've got the list of currency rates going from 1998 (actually from 1996, but BoT don't show those numbers) to now, I exported it to an excel sheet and the list is from BoT listing rates by the month.

Do you want it?

PM me and I will send it to you.

[lostoday]

Hey Thailand welcome to the rest of the world.

I do hope you quit supporting the Thai baht so much, and let it slump a bit

toward the real value of Baht versus USA dollar.

Just saying!

180 degree backwards. BOT is keeping the baht low not supporting it to be high. Think Swiss. Same deal. Swiss were keeping the Franc low for years and finally gave up and the Franc rose and killed exports.

[lostoday]

The Thai baht, its goods and many services are overvalued by 30% or so.

Much more than that. 50% is more likely. And the coin will drop significantly at some point.

The reverse. The baht is undervalued by about 20%. Hence if the bank stopped manipulating it would rise in value not go down.

[Sealbash]

Not only Thailand,

Name me another economy facing it`s worst economic in 40 years?

It is only Thailand.

You and about a dozen posters spend all day on TVF rebutting any criticism of the junta. Quite why no one knows, it is truly bizarre behaviour.

Greece

Venezuela

[lostoday]

Hey Thailand welcome to the rest of the world.

I do hope you quit supporting the Thai baht so much, and let it slump a bit

toward the real value of Baht versus USA dollar.

Just saying!

What is USA govt debt to gdp now? 80%? 85? Go look up Thailand and understand why the USD is so weak.

Russia and Venezuela and oil down USD up.

Google. UK debt to GDP ratio 90.3

USA debt to GDP ratio 80.1

Thailand debt to GDP 43.9

[chiang mai]

No peg with the US$. As previously mentioned, the baht has weakened considerably against the US$ from 29 to now above 32. The problem is the baht relative strength to other Asian currencies and the Euro.

Stop telling people the exchange rate was 29 TBH for one US$, I'm getting paid in US$ and during three years now, the US$ have never been lower than 31 except for a quick drop at one point but BoT quickly called in the troops.

April 21 2013, 28.76.

http://www.oanda.com/currency/historical-rates/

I've got the list of currency rates going from 1998 (actually from 1996, but BoT don't show those numbers) to now, I exported it to an excel sheet and the list is from BoT listing rates by the month.

Do you want it?

PM me and I will send it to you.

No, I wouldn't object however if you clicked on OANDA or similar and looked at USD/THB exchange rates for the past five years and you'll see the answer.

[chiang mai]

No peg with the US$. As previously mentioned, the baht has weakened considerably against the US$ from 29 to now above 32. The problem is the baht relative strength to other Asian currencies and the Euro.

Stop telling people the exchange rate was 29 TBH for one US$, I'm getting paid in US$ and during three years now, the US$ have never been lower than 31 except for a quick drop at one point but BoT quickly called in the troops.

April 21 2013, 28.76.

http://www.oanda.com/currency/historical-rates/

I've got the list of currency rates going from 1998 (actually from 1996, but BoT don't show those numbers) to now, I exported it to an excel sheet and the list is from BoT listing rates by the month.

Do you want it?

PM me and I will send it to you.

No, I wouldn't object however if you clicked on OANDA or similar and looked at USD/THB exchange rates for the past five years and you'll see the answer. BTW exchange rates vary by the minute hence a monthly listing is not much use.

[KamalaRider]

April 21 2013, 28.76.

http://www.oanda.com/currency/historical-rates/

I've got the list of currency rates going from 1998 (actually from 1996, but BoT don't show those numbers) to now, I exported it to an excel sheet and the list is from BoT listing rates by the month.

Do you want it?

PM me and I will send it to you.

No, I wouldn't object however if you clicked on OANDA or similar and looked at USD/THB exchange rates for the past five years and you'll see the answer. BTW exchange rates vary by the minute hence a monthly listing is not much use.

Yes they do, and I did, but you don't find it odd Thai baht are so stable against the US$ and not any other currency?

[chiang mai]

Here's the exchange rate for Thai baht compared to US$ between August 2006 and April 2015.

So I should have said not less than 30 instead of 31, sorry, my bad.

Look at the FIVE year history, the rate I refer to is very easily seen. Using the longer time frame that you used obscures the view of that dip.

[chiang mai]

April 21 2013, 28.76.

http://www.oanda.com/currency/historical-rates/

I've got the list of currency rates going from 1998 (actually from 1996, but BoT don't show those numbers) to now, I exported it to an excel sheet and the list is from BoT listing rates by the month.

Do you want it?

PM me and I will send it to you.

No, I wouldn't object however if you clicked on OANDA or similar and looked at USD/THB exchange rates for the past five years and you'll see the answer. BTW exchange rates vary by the minute hence a monthly listing is not much use.

Yes they do, and I did, but you don't find it odd Thai baht are so stable against the US$ and not any other currency?

If you do the math, THB has moved over 12% against USD over the past five years, what it may have done against other currencies is another topic - 12% is not stable.

[KamalaRider]

I did the math and I also compared over 5 years, but you can't be serious if you say 29.687 is ~29, if finance experts/economists counts like that, I understand why the finances goes to s-t every now and then.

And I would say that 12% is VERY stable in the world of electronic money exchange surveillance and transfers.

[Mr Somtam]

Do they have maths teachers in Thailand, because nobody seems to come up with the same numbers, and they change by the day

Calculus is not thailands most developed skill.

Ok mistah, this one 30 baht that one 20 baht, total is, eeeeh, deeow nah, (take out calculator), click click click click, ah fifty baht!

[metisdead]

A post containing an over sized image has been removed as it messed up the formatting of this page.

[gemguy]

Hmmmmm....they can always blame the problems on someone else...right?

At present they can blame the current Military government..................yes sir they most certainly can.

Cheers

[lostoday]

Do they have maths teachers in Thailand, because nobody seems to come up with the same numbers, and they change by the day

Calculus is not thailands most developed skill.

Ok mistah, this one 30 baht that one 20 baht, total is, eeeeh, deeow nah, (take out calculator), click click click click, ah fifty baht!

List of alumni of St John's College, Oxford

Korn Chatikavanij 1983 BA PPE

Thailand Finance Minister (2008-2011)

Abhisit Vejjajiva 1983 BA PPE (1st), MPhil 27th Prime Minister of Thailand (2008-2011)

Is that how Oxford grads talk. OK mistah?

[micmichd]

Do they have maths teachers in Thailand, because nobody seems to come up with the same numbers, and they change by the day

They come up with aggregate data.

You need a computer to process the raw data. Maybe the algorithms are published somewhere.

And, of course, they have teachers for this. Math, economics, statistics. Just google.

Yet, you would still need a clear concept (a theoretical fundament) how economy works and what money really is. Then you can verify or falsify by numbers (data)

[micmichd]

Be careful if you publish results on economic development based on data. You might cause a panic.

[Orac]

Another major factor influencing Thailand's biggest GDP earner - exports - is the inability of the current regime to negotiate bilateral deals with some of its major trading partners. They need free trade deals in place with the likes of US and EU to replace the GSP agreement that ended at the beginning of the year but are not likely to see these until more democracy is restored.

[chiang mai]

I did the math and I also compared over 5 years, but you can't be serious if you say 29.687 is ~29, if finance experts/economists counts like that, I understand why the finances goes to s-t every now and then.

And I would say that 12% is VERY stable in the world of electronic money exchange surveillance and transfers.

For the very last time: USD/THB 28.76, w/e 28 April 2013, done!

[boomerangutang]

I'm divested as much as possible. To me, the real currency is quality of air soil and water, incidence of wild animals in my neighborhood, and overall quality of life for me and my neighbors.

Here's how it breaks down:

>>> Quality of air, soil and water, grade: E

air is bad 2 months of year, but it's mostly wood smoke, and not so much toxic bad air as you find in China. Soil is being eroded by hundreds of tons, and what's left is being toxified with chemicals, and then planted with monocrops. Water in rivers is trashed, as are any places where people gather.

>>> Incidence of wild animals in my neighborhood, grade: F Near zero # of wild mammals. I saw a black squirrel the other day. As a comparison, in most parts of the US, there are wild mammals of all types and sizes. Instead, Thailand is overrun by chickens and dogs. In a normal week, a dozen dogs are abandoned on my rural road. During Songkran, twice that # were abandoned, and that's just one little rural road in Thailand.

>>> Overall quality of life for me and my neighbors. grade: C- Noise, noise, and more noise. If it's not packs of dogs barking, it's neighbors' loud talking or blaring music. The prize for blaringest music is the local wat which blasts the same song 14 times a day for years. There is no off button. You either love hearing the same song thousands of times, or you got to leave or go crazy, or spend your days and nights with super-sized plugs in your ears.

Economics are not so important if quality of life is down the tubes.

[pegman]

Let's see. How long ago was the Asian Economic Crisis that nearly wiped Thailand off the map? 1997? Bit more recent than 40 years. Do they teach history at the University of Thai Chamber of Commerce?

No, hyperbole!

[pegman]

http://www.cnbc.com/id/102478587

Disinflation, low demand, crash a coming

[KamalaRider]

I did the math and I also compared over 5 years, but you can't be serious if you say 29.687 is ~29, if finance experts/economists counts like that, I understand why the finances goes to s-t every now and then.

And I would say that 12% is VERY stable in the world of electronic money exchange surveillance and transfers.

For the very last time: USD/THB 28.76, w/e 28 April 2013, done!

I'm really tired of people who don't read posts properly.

I said >>>"except for a quick drop at one point but BoT quickly called in the troops."

DONE!

[KamalaRider]

http://www.cnbc.com/id/102478587

Disinflation, low demand, crash a coming

If the BoT isn't supporting the baht, who is?

Springs to mind what the Swedish Central bank did with the Swedish crown in 1992, but here without the BoT trying to keep the value of the Thai baht.

According to news media, Thailand has 0% export growth, tourism in money is declining, investments in Thailand aren't growing.

What's the catch here?