Economy will expand to 4.7%: Prayut

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Economy will expand to 4.7%: Prayut
Erich Parpart
The Nation

BANGKOK: -- Prime Minister General Prayut Chan-o-cha expects the economy to expand by 3.7 to 4.7 per cent next year, when the government starts spending the Bt2.72-trillion budget earmarked for the 2016 fiscal year.

He made the prediction at the first vetting of the 2016 budget bill by the National Legislative Assembly (NLA) yesterday. Meanwhile, the second and third vetting of the inheritance tax was set for the same day, but was postponed to the next meeting as discussions on the budget took longer than expected.

The premier also said that the government believes the gross domestic product for this year will expand by 3.5 to 4.5 per cent.

"I believe the disbursement of the government's fiscal budget is crucial for the implementations of its policies and economic and social-development measures," he added. "The disbursement of the investment budget will be based on priority. Projects that are most tangible, promising and advantageous to the country will commence first, while other projects that do not have such qualities will be put on hold pending future funding to lower the burden on the budget."

Prayut explained that economic expansion in 2016 is expected to be better than in 2015 because the global economy is also expected to improve, which will help Thailand's export sector, while crop prices have the potential to stabilise and rise.

"Up to 70 per cent of our exports are agriculture products, so if the crop prices rises and external demand is more [when compared to this year], then the export situation will be better next year," he said.

The expected increase in external demand would also boost the confidence of the private sector, while further expanding government spending on mega-projects and special economic zones. Accelerated budget disbursement should also continue to help with the expansion of the economy next year, he explained.

Meanwhile, while vetting the 2016 budget bill, most NLA members commended the government's decision to boost the investment budget, though some said more funds should be earmarked for research and development. Also, some called for fixed expenditure and spending on state-owned enterprises to be lowered further via the public and private partnership model.

Larger R&D budget sought

NLA member Somchai Sawangkarn said the R&D budget should be increased from the current 1 per cent (Bt25.46 billion) earmarked for fiscal 2016 to 3 per cent in fiscal 2017 to back the creation of value-added, high-technology products.

Montian Boontan and Nisada Vechayanont, also NLA members, proposed that the government give the private sector more responsibility for public service as they are more efficient and this would also lower the government's annual fixed budget, because it will not need to hire any more personnel for the services.

If the budget bill is passed, the investment budget for fiscal 2016 will be set at Bt543.635 billion, which is Bt94.16 billion or 20.9 per cent higher than in fiscal 2015. Most of this budget will be concentrated on projects for water management, basic infrastructure, road connectivity and school buildings.

Around Bt520 billion will be allocated to the Education Ministry, Bt402 billion to the central budget, Bt343 billion to the Interior Ministry and Bt207 billion to the Defence Ministry (marking a 7 per cent increase). The budget for provinces and provincial groups is Bt25.199 billion, up 41.7 per cent; for the Transport Ministry Bt138.886 billion, up 25.4 per cent; and for the Natural Resources and Environment Ministry Bt36.420 billion, up 20.4 per cent.

The 2016 state budget will account for 20.4 per cent of the gross domestic product, which is the same as the 2015 budget. The 2016 fiscal budget year begins on October 1, 2015.

The NLA will conduct the second and third vetting, starting on August 27, after setting up a 50-member committee for the task.

Source: http://www.nationmultimedia.com/business/Economy-will-expand-to-4-7-Prayut-30260655.html

-- The Nation 2015-05-22

[noitom]

In orde to justify their absurdly large budget, the Thai appear to be inflating potential GDP growth to 3.7%. Let's keep an eye on this over time.

[BSJ]

It's a lot of baht! Carrying a large deficit will be the norm once the payback starts for the PM's railway expansion.

[hagler]

4.7% ???

bullsh*t

[shirtless]

These guys are really optimistic i hope it works out wait a month for these figures to contract

[NongKhaiKid]

He's been attending the TAT classes ' Statistics For Simpletons, all you need to know about figures so you can BS '.

[lujanit]

4.7% ???

bullsh*t

Not necessarily. I have said it before and I'll say it again. I smell a baht devaluation on the horizon.

How else can the PM reconcile his statement of '"Up to 70 per cent of our exports are agriculture products, so if the crop prices rises and external demand is more [when compared to this year], then the export situation will be better next year," he said."

crop prices rises and external demand is more [when compared to this year] can be achieved by a baht devaluation.

[ezzra]

The fiendish Gen. PM Prayut <deleted> Manchu keeps coming up with new edicts, prediction and proclamations

almost on a daily bases, more than a number of past governments put together, some of them

are purely for crowed pleasing purposes... the others, yet to come to fruitions.. talk is cheap,

action is costly....

[MockingJay]

Words are cheap! I wonder how Monsieur General all of a sudden became an economics expert... It's a superficial motivation speach for the blind and willing, based on assumptions and "expectations". No one can say what 2016 will bring, especially not in times like this.

Edited May 22, 2015 by MockingJay

[fred Kubasa]

AND, I will be deluged with sensuous requests from Playboy centerfolds while, winning the lottery and

my wife wants nothing out of the divorce except my eternal happiness !

[Benmart]

4.7% ???

bullsh*t

Crude, even with the *.

Statements, supported by rational thought, seem to have more credibility than those that relying simply on the asterisk.

[smutcakes]

Where is all the infrastructure stuff? I was told this Govt would do everything within budget?...... Rubl?

[ldiablo]

I wonder what percentage of the Bt 2.72 trillion will not go into the personal bank accounts of this government.

[rametindallas]

Whatever the true/exact growth rate in Thailand is, it is surely better than the 0.7% growth rate in the US or most other developed countries. I shouldn't quibble over fractions;it's not like Kittirat's wildly optimist projection under the Yingluck government. Remember Kittirat's 'little white lie'? http://www.nationmultimedia.com/business/White-lies-sometimes-needed-30188991.html

Edited May 22, 2015 by rametindallas

[ikke]

Is there anyone in this nation who still believes this shit, This guy is really a joke, he don't know any thing about economy and still comes up with this populist shit talk.

[casindonet]

Expand by 4.7%? Is that an order, Sir?

[mike324]

Its more like along the low 3% mark. Even 3% will be a struggle.

I find it hilarious that people are talking trash about the General on where the infrastructure is, do you guys honestly think it only takes 1-2 year to build highways and high speed trains? Come on be more realistic here, if you want to talk trash don't make yourself look silly with your comments.

Why don't you go back to the PTP administration and see what happen to the hundred billion baht Flood Prevention plan? Billions taken out and nothing done with K-Water trying to sue the government over breach of contract.

Not saying the currently situation is any better, budget increase almost across the board yet there is no concrete plan. Wasteful spending again just like any other party. The most worrying is always the Education Budget.