Stimulus to boost growth next year

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ECONOMIC
Stimulus to boost growth next year
Erich Parpart
The Nation


Issara Vongkusolkit

BANGKOK: -- The Joint Standing Committee on Commerce, Industry and Banking and the Thailand Development Research Institute see a better year for the economy in 2016, as the major drivers - consumption, exports and investment - are all expected to hit the road.

"The stimulus measures that have been introduced will contribute to better economic expansion next year along with the government investment on infrastructure," Supant Mongkolsuthree, chairman of the Federation of Thai Industries, a member of the Joint Standing Committee, said yesterday.

"The opening of the AEC [Asean Economic Community] will also be another important catalyst for GDP growth in 2016, as it could attract more investment from abroad, especially from China," he told reporters at a seminar on "Thailand's Strategy: Prospering CLMV" arranged by the Thammasat Economics Association

However, another possible severe drought, continuing high household debt and a further delay in state investment projects could weigh on the expansion of gross domestic product next year.

However, another possible severe drought, continuing high household debt and a further delay in state investment projects could weigh on the expansion of gross domestic product next year.

The Joint Standing Committee expects GDP to grow by about 2.5-3 per cent this year. It is expected to come out with its 2016 forecast by next month.

The TDRI predicts the economy to pick up by about 3-3.5 per cent next year.

Supant said the government's economic stimulus measures to support low-income earners and small and medium enterprises - along with the measures to boost the real estate industry and private investment worth about Bt350 billion that were introduced in August - will support the economy's expansion next year.

The Public-Private Partnership Committee green-lighted the first five fast-track projects worth Bt334.21 billion on Wednesday.

Short-term incentives

"The new BoI [board of Investment] short-term incentives will also encourage this development," he said, referring to the extension of tax privileges for promoted firms by a maximum of four years if they decide to accelerate their investment from now until the end of next year.

Demand for agricultural products and their prices are expected to be better next year due to the global economic recovery. This will increase farmers' income and purchasing power, he said.

Issara Vongkusolkit, chairman of the Thai Chamber of Commerce, another Joint Standing Committee member, said consumer confidence was gradually rising while the chamber's latest survey showed that its members' confidence in the economy next year has "improved immensely".

Supant said exports to CLMV (Cambodia, Laos, Myanmar and Vietnam) would continue to climb next year on the subregion's insatiable demand for products and investment.

China is also expected to further increase its investment in |CLMV countries to lower production costs and support its go-south policy.

Issara urged the country to think about saving water now to prepare for the drought next year.

Myanmar's successful election means that more investment could be heading that way, he said.

Kirida Bhaopichitr, director of international research and advisory services at the TDRI and a former senior World Bank economist for Thailand, said outbound shipments would edge up about 0-1 per cent next year from the global economic recovery.

The 4G auction will lead to an increase in private investment next year.

The risks to the economy next year are the uncertainties surrounding the recovery of domestic consumption, as household debt is still high (86 per cent in June); the effectiveness of the government's stimulus measures, which are expected to be only for the short term; and any further delay in government transport infrastructure projects, which could drag down economic momentum and badly affect the confidence of investors, she added.

Source: http://www.nationmultimedia.com/business/Stimulus-to-boost-growth-next-year-30272803.html

-- The Nation 2015-11-13

[Hawk]

"as the major drivers - consumption, exports and investment - are all expected to hit the road."

As in falling down.

[Hawk]

"The Joint Standing Committee on Commerce, Industry and Banking and the Thailand Development Research Institute see a better year for the economy in 2016,"

But, only if all the other problems go away, which of course they won't.

[deckape]

Stimulus to boost growth next year

He repeated hopefully.

[worgeordie]

Stimulus to boost growth next year, tickle its belly.

regards Worgeordie

[jphantom]

A realistic way to "stimulate" the Thai economy is (a) to strengthen the work force skills and ( to dismantle the feudal system that throttles underlying competitiveness, particularly among the Asean group where Thailand is losing rapidly. Elements of work force weakness are poor education featuring memorization without the ability to reason, as well as horrible language skills.

Bureaucracy is killing foreign investment both multinational and entrepreneurial.

[elgordo38]

Here's another one. I hope the stimulation they use works better than mine does. Last one was a flop.