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Government spending and Private Consumption to spur Thai economy

With a 3.8% increase in private consumption in the second quarter this year and higher tourism growth, the Thai economy seems to be on the way of a modest economic recovery.

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With a 3.8% increase in private consumption in the second quarter this year and higher tourism growth, the Thai economy seems to be on the way of a modest economic recovery.

Deputy finance minister Wisudhi Srisuphan yesterday voiced optimism that government spending in infrastructure projects will help bolster economy with continual growth is expected in the second half of the year.

Besides, government’s spending on infrastructure mega projects would stimulate growth in the second half of this year.

GDP growth this year is now projected to rise to 3.3%, exceeding the earlier forecast 3%, the University of the Thai Chamber of Commerce (UTCC) revealed last week.

The improved growth was attributed mainly to government spending in mega projects and the charter referendum which ended peacefully with the majority giving approval to the charter.

Thanawat Pholvichai, director of the UTCC’s Center for Economic and Business Forecasting, said the recent sign of economic recovery was seen in the consumers confidence index in July which rose for the first time in seven months, along with lower inflation rate, improving drought situation helped boost the growth.

BOT: High consumption growth in Q2 reflects economic recovery

The Bank of Thailand (BOT) has indicated that the Thai economy has fully recovered, judging from the significant increases in GDP and private consumption in the second quarter.

Mr Jaturong Jantarangs, the BOT’s Assistant Governor for the Monetary Policy Group, noted that national GDP expanded 3.5 percent year-on-year during the second quarter. Moreover, according to a report by the National Economic and Social Development Board, private consumption also posted a rise of 3.8 percent.

He said both figures are indicative of full economic recovery although public investment, which has been a major driver of the economy, is slowing down slightly while private investment remains sluggish.

Compared with domestic factors, the Assistant Governor pointed out that the central bank is indeed giving more weight to the mounting risks from uncertainties in the global economy.

As for the appreciation of the Thai baht over the past 2-3 days, Mr Jaturong said it was due to the positive economic indicators of the second quarter as well as the success of the August 7 constitutional referendum, lending a boost to capital inflow.

Economics

Asia’s slow rate of vaccination is a thorn in the region’s economic recovery

Southeast Asia has been hit badly. Daily infections for Indonesia, Thailand, Vietnam are at their worst, on a seven-day moving average. The Philippines and Malaysia are not far off their daily infection peaks reached in the second quarter of 2021.

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Last week was tough for the Asia-Pacific region. Many countries responded to stubbornly elevated daily infections by extending or tightening social distancing measures.

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Economics

World Bank lowers Thai GDP growth outlook to 2.2%

In the Thailand Economic Monitor released today, the World Bank adjusted its outlook on Thailand’s economic growth this year to just 2.2% from its previous forecast of 3.4%.

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BANGKOK, July 15, 2021 – Thailand’s economy continues to take a heavy toll due to the COVID-19 pandemic and is projected to expand modestly at 2.2 percent in 2021, revised down from the 3.4 percent growth projected in March, according to the World Bank’s latest Thailand Economic Monitor “The Road to Recovery” published today.

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