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Bank of Thailand lifts GDP forecast

The Bank of Thailand expects the strong baht and widespread flooding to have a minimal impact on the economy in 2011, while the Finance Ministry has forecast 7.3% growth in GDP this year after taking into account those factors.

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The Bank of Thailand expects the strong baht and widespread flooding to have a minimal impact on the economy in 2011, while the Finance Ministry has forecast 7.3% growth in GDP this year after taking into account those factors.

Paiboon Kittisrikangwan, assistant governor for the Monetary Policy Group, said local exporters had been able to cope with the baht’s gains by taking steps to protect against loss. The hedging ratio increased to 43% of total income in September from 35% in August.

Slowing advanced economies, rather than the strengthening baht, would be the key factor for a decline in export growth into 2011,

said Mr Paiboon.

He said local business operators had also increasingly shifted settlement currency to other currencies as the dollar weakened. They also shortened the maturity of orders to three months or shorter from the typical six months.

“That some shippers are capable of bargaining for a better price and are expanding capacity helped to compensate for the impact of currency exchange loss on the overall economy,”

he said.

“We believe exports are capable of growth in 2011. A strengthening currency is a regional phenomenon.”

The central bank’s nominal effective exchange rate calculated by the Bank for International Settlements showed the baht had strengthened 6.5% for the year to date against the dollar when weighed against trade partners.

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BoT lifts GDP forecast

In order to ensure Thailand’s competitiveness in the near future, Thailand needs to improve its productivity and investment climate. Experience from countries that have managed to increase productivity and rise up the value chain such as South Korea and Taiwan have shown that productivity improvements at the national level are achievable with a concerted efforts by the private sector, government, and academia.

Government in Thailand should take measures to improve the country’s investment climate such as streamlining the regulatory environment and improving public infrastructure which will help stimulate private investments as they help to reduce operating costs for firms

So far, two tranches of the TKK Program (2009-2012) worth Bt350 billion (US$10.5 billion) have been released, with the first tranche in the amount of Bt200 billion and the second tranche of Bt150 billion.

The focus of the TKK Program so far has been on quick disbursing investment projects as well as transfers and subsidies to local governments, communities, and farmers. A large share of the package is allocated to the agriculture and education sectors and community spending. Around two-thirds of the Bt350 billion or Bt230 billion is to be used for construction and equipment purchase, of which around three-quarters or Bt175 billion (1.9 percent of GDP) is expected to be disbursed in 2010, thus contributing to public investment.

Economics

Thai fruit exports to FTA markets up 107 percent

China, Malaysia, Singapore, Indonesia, the Philippines, Hong Kong, Australia and Chile are top importers of Thai fruits, especially fresh durian, mangosteen, longan and mango. Thai exporters are able to benefit from FTA privileges.

National News Bureau of Thailand

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BANGKOK (NNT) – Thailand’s fruit exports continue to increase, despite the sluggish global economy caused by the COVID-19 pandemic, with key trade partners being countries that have free trade agreements (FTAs) with the kingdom.

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Economics

The Future of Asia: greener but with a public and private debt hangover

The COVID-19 pandemic has been a perfect storm, destroying jobs, worsening poverty and inequality, and creating a public and private debt problem—especially for countries and firms already in fragile financial health beforehand

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The Sydney Opera resumed live performances and the city of Melbourne recently hosted the Australian Open tennis tournament with fans (mostly) in attendance.

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Economics

50:50 campaign may not get immediate extension

National News Bureau of Thailand

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BANGKOK (NNT) – The government’s 50:50 co-pay campaign expiring on 31st March may not be getting an immediate campaign extension. The Minister of Finance says campaign evaluation is needed to improve future campaigns.

The Minister of Finance Arkhom Termpittayapaisith today announced the government may not be able to reach a conclusion on the extension of the 50:50 co-pay campaign in time for the current 31st March campaign end date, as evaluations are needed to better improve the campaign.

Originally introduced last year, the 50:50 campaign is a financial aid campaign for people impacted by the COVID-19 pandemic, in which the government subsidizes up to half the price of purchases at participating stores, with a daily cap on the subsidy amount of 150 baht, and a 3,500 baht per person subsidy limit over the entire campaign.

The campaign has already been extended once, with the current end date set for 31st March.

The Finance Minister said that payout campaigns for the general public are still valid in this period, allowing time for the 50:50 campaign to be assessed, and to address reports of fraud at some participating stores.

The Fiscal Police Office Director General and the Ministry of Finance Spokesperson Kulaya Tantitemit, said today that a bigger quota could be offered in Phase 3 of the 50:50 campaign beyond the 15 million people enrolled in the first two phases, while existing participants will need to confirm their identity if they want to participate in Phase 3, without the need to fill out the registration form.

Mrs Kulaya said the campaign will still be funded by emergency loan credit allocated for pandemic compensation, which still has about 200 billion baht available as of today.

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