The Bank of Thailand (BOT) has revised down growth projections for Thailand in 2016 to 3.5% from its September assessment of 3.7% as exports remain sluggish.
The revision was made because the projected increase in private consumption and public expenditure “could not compensate for a downward revision of export growth due to a slower-than-expected economic recovery of Thailand’s major trading partners,” the BOT said in a statement.
In addition, both the upside and downside risks around the baseline projection increased, reported Xinhua News.
The key downside risk was “an even slower recovery of Thailand’s major trading partners,” the central bank said.
The key upside risk was the “faster-than-expected expansion in public investment,” which might additionally crowd in more private investment than currently assessed.
Nonetheless, the bank said that overall risks to growth remained skewed to the downside.
The BOT also slightly raised its growth forecast for the country in 2015 to 2.8% from the September assessment of 2.7%.
Exports remain inert
At the same time, BOT announced that the local economy recovered slightly in November on higher government spending, car sales, and tourist arrivals, even as exports continued to shrink, the National News Bureau of Thailand said in news report.
BOT’s Roong Mallikamas, senior director of macroeconomic and monetary policy, pointed to government spending on transportation and irrigation as well as consumer spending especially on vehicles for the slight uptick. Further, in the tourism sector, November saw 2.5 million visitors, a 2.5% increase from the preceding month and a 5.1% increase from the same period last year.
However, export prices for the period reflected the negative impact of the slowdown in the global economy, sluggish commerce with ASEAN economies, and low global oil prices, which all caused industrial and private production to plummet.
As a result, Thailand’s export sector contracted by 6.6% in November compared to the same period last year.
Photo: Paolobon140
