Friday, October 11, 2019
InfoQuest (October 11, 2019) - "I'm full of confidence in Thailand's realizing the GDP growth objective of 3 percent (+/-) this year," said Mr. Kobsak Phutrakul, assistant minister to the Prime Minister's Office after the economic cabinet meeting, "Some agencies may not take into account the economic stimulus measures to be introduced by the government at the end of the year, which is why they give a slightly lower forecast of 2.7 percent or 2.8 percent." According to him, it is still too early to revise down GDP growth forecasts. Although current escalating global tensions will affect how the Thai economy will unfold next year, the government will take measures to drive the national economy forward in any case.
"The economic data for the third quarter is coming out, and we will compare it with that for the second quarter. And we believe that our economy will perform better in the fourth quarter than in the third quarter. On the basis, we will try our best to help the first quarter of 2020 outperform the fourth quarter of 2019. It is our goal to bail the economy out of its slowdown," said Mr. Kobsak.
According to him, the Thai government will stick at the GDP growth for this year of 3 percent, considering this target suitable, and at the same time, it may introduce more stimulus measures later, which depends on whether the global economy will deteriorate. In addition, Thailand is planning to conduct a review of economic forecasts and an analysis of all economic data recently. For example, export data will be analyzed, and if exports are not as good as expected, the government will introduce measures to increase exports. At this point, the government's budget expenditure has started to return to normal, but occasional expenditure delay still happens in state-owned enterprises.
No doubt current continuous appreciation of the Thai baht will be a topic of discussion in a long time, as it has affected exports, tourism and agricultural products. But that still depends on how the measures to be introduced by the Bank of Thailand (BOT) on the appreciation of the Thai baht within the next 1-2 months will work.
"I am also waiting for BOT's moves. I ever worked in BOT, so I have many expert contacts there. The central bank did well in solving depreciation, and then appreciation of the Thai baht. Today, it is good at both. At the moment, it is considering what and how measures should be taken. I will continue to support the central bank just like I always do," said Mr. Kobsak.
Continuous appreciation of Thai baht at a time of global economic slowdown has led to an increase in foreign speculators using Thailand as a speculative channel in the ASEAN region. Generally speaking, currency speculators prefer countries where it is easy for capital to flow in and out and Thailand right fits the bill.
"Currency speculation entails a lump sum of investments, which can flow in and out within a day. The hot money is just like cars eager to find a good, convenient parking place, and Thailand is the right one. Now, we are considering how to make 'parking' more difficult, because if it is too easy, they will always want to park here," said Mr. Kobsak.
Source: InfoQuest, by Nisarat Wichiensri/Sasithorn, translated by Xinhua Silk Road
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