Exports rise for fifth straight month; GDP picking up steam
Thailand’s exports, the most important piston in the Kingdom’s economic engine, rose for a fifth straight month in July posting a 10.5 percent year-on-year increase as the economy grew by 3.7 percent in the second quarter for the strongest quarterly performance since 2013, prompting some analysts to raise their growth forecasts for the year.
“The second quarter is quite good and the government will try to maintain this momentum until the latter half this year. The government is hopeful that the Thai economy in the second half will fare better than in the first, thanks to the growing trend of exports and recoveries in private investment and the agricultural sector,’’ said Deputy Prime Minister Somkid Jatusripitak, who oversees the economic ministries.
The National Economic and Social Development Board (NESDB) reported that the 3.7 percent gross domestic product increase was the strongest in 17 quarters and a significant increase over the 3.3 percent in the first quarter of this year.
Porametee Vimolsiri, secretary general of the NESDB,said second-quarter growth was driven by an expansionin exports of goods and services, a continued rise in private consumption and a rebound in private investment.The comeback in private investment was an especially important contributor, he said.
Private investment expanded by 3.2 percent year-on-year, mainly driven by investment in machinery and equipment, and construction, after contracting 1.1 percent in the first quarter.
Investments in machinery and equipment played a part in the Kingdom recording its first trade deficit in more than two years. Imports rose 18.5 percent in July from the same month last year for a small deficit of $188 million.
Analysts said that rising imports were a healthy sign for the economy, however, as they were driven mainly by capital goods for investment rather than goods for consumption.
The Ministry of Commerce raised its forecast for export growth for the year to between 5 and 6 percent, from a previous projection of a 5 percent growth rate. The NESDB predicted export growth would be 5.7 percent for 2017, a significant adjustment from its earlier forecast of 3.6 percent.
The value of exports in the second quarter was recorded at $56.1 billion for an 8 percent growth rate, the fastest growth rate in the last 18 quarters.
Minister of Finance Apisak Tantivorawong said that annual gross domestic product growth rates should return to the 5 to 6 percent range in the next few years. As investments in the Eastern Economic Corridor the country’s advanced development zone take shape, Apisak, growth would rise significantly.