Business groups raise export forecast
Thailand’s economic czar said last week that he is confident that private investment will recover in 2017 as solid growth has already returned, while an organization of business leaders raised its forecast for export growth this year because of stable oil prices, rising farms prices and improved outlooks for the domestic and global economies.
“If you ask me why I am confident about the situation this year, I would say that, basically, it is because we have managed to handle the bad times,’’ said Deputy Prime Minister Somkid Jatusripitak, who oversees the economy. He added that increasing investment from the private sector is at the top of his agenda for 2017.
“This is our priority this year. Before the financial crisis [of 1997], private investment was as high as 40 percent against GDP [gross domestic product]. But since then, it has never been able to reach that level. It is now at only 20 percent, so there is big room for growth,” he said.
Somkid said that many policies and projects would accelerate and bear fruit during the coming year. Last year “was the period of kicking off, so 2017 must be a year of execution. In fact, we have sown the seeds to get a number of projects started and for the private sector to carry on with them. Some projects have already started to bloom,’’ he said.
The government is partnering with the private sector on a massive infrastructure building and upgrade program consisting of new or improved rail lines, port facilities, roads and highways, and airport expansions. Various projects have already been bid upon and construction is beginning, and more projects will be open for bidding in coming months.
The infrastructure will keep Thailand competitive by staying several steps of neighboring countries that have begun building their own facilities and transport lines, while also stimulating growth by creating jobs and spurring consumption.
“However, we have to look at the performance of the export sector, which accounts for 70 percent of our GDP, but the world is still slow and we cannot control this,” he cautioned.
Big business leaders in Thailand, however, were a bit more optimistic about exports for this year.
At the Thai Chamber of Commerce, the Joint Standing Committee on Commerce, Industry and Banking raised its forecast for exports this year to between 1 and 3 percent, from an earlier prediction of 0 to 2 percent. If the higher export forecast proves accurate, the Committee expects economic growth to total between 3.5 and 4 percent.
Isara Vongkusolkit, chairman of the Thai Chamber of Commerce said the improved forecast was based largely on oil prices achieving more stability, allowing for importers and other businesses to plan ahead with more confidence and make greater commitments.
He also said that rising commodity prices would help farmers and exports, and that farmers earning more would spend more, helping to also increase consumption.