By NNN-TNA
Bangkok : The Thai economy is expected to grow at least 4.5 per cent this year and 4-5 per cent next year, boosted by a recovery in household spending and private investment, according to the National Economic and Social Development Board.
NESDB’s Secretary-General Amphon Kitti-amphon announced the gross domestic product (GDP) in the third quarter of this year expanded 4.9 per cent, higher than 4.2 per cent in the first quarter and 4.3 per cent in the second quarter, since the household spending edged up by 1.9 per cent against 1.3 and 0.8 per cent in the first and second quarters
Private investment began to recover with an increase of 1.1 per cent against a decline of 2.3 per cent and 0.47 per cent in the first and second quarters because of more construction and the subsequent rise in importation of machinery and equipment.
The state budget disbursement met the target of Bt407 billion (US$13.24 billion), up from Bt348.59 billion (US$11.34 billion) in the same quarter last year.
In addition, tourism began to turn around with foreign arrivals increasing 2.2 per cent from 0.4 per cent in the second quarter, while exports continued to grow.
The unemployment rate stayed at a low level of 1.2 per cent and the inflation rate stood at 1.6 per cent, down from 2.4 and 1.9 per cent in the first and second quarters.
Thailand’s current account balance was in surplus of US$2.93 billion.
He said the overall economy remained sound late this year with positive factors outpacing risk factors, including clarified political direction and low interest rates.
He projected GDP in the fourth quarter would grow 4.6-4.7 per cent although the exports are expected to expand at a slower pace in the last two months of this year.
Given these factors, he believed the economy this year would grow no less than 4.5 per cent and 4-5 per cent next year, bolstered by low interest rates, low unemployment, government officials’ salary increase, adoption of a budget deficit to stimulate the economy, and clear political direction.
Persistent risk factors regarding economic growth include hefty oil prices, global economic slowdown, and persistent sub-prime lending woes in the United States.
Mr. Amphon projected imports in 2008 would expand 12.5 per cent compared with 10 per cent this year because of shipments of machinery to accommodate the country’s increased investment.
It would bring down the current account surplus to 3.6 per cent next year from 4.9 per cent this year.
He forecast the investment next year would increase to 5.8 per cent from 1.3 per cent this year. In particular, state investment would rise to 8 per cent from 4.5 per cent.
Consumption is likely to increase to 4.5 per cent in 2008 from 3.1 per cent this year.
However, exports would grow only 10 per cent to $163.9 billion, down from 16 per cent with a value of $148 billion this year.
The inflation rate would stay at 3-3.5 per cent compared with 2.3 per cent this year, he predicted.