BoT lowers Thailand’s growth projection; sees 1.5-3.5% contraction in 2009

BANGKOK, April 22 – Thailand’s economy, now suffering badly due to the global economic meltdown, has forced the Bank of Thailand (BoT) to reduce the projected gross domestic product (GDP) for 2009 to between 1.5-3.5 percent lower than the 0-2 percent growth rate forecast in January, a senior BoT official said on Wednesday.

BoT assistant governor Duangmanee Vongpradhip said the central bank decision to further shrink the GDP projection was in response to Thailand’s economy being hit severely during the first quarter of 2009 due to a world economy which had retreated sharply, causing the country’s exports to plummet.

Thailand’s exports this year are now expected to contract 24.5-27.5 percent compared to the contraction of 5.5-8.5 percent projected earlier, Miss Duangmanee said.

The country’s GDP for 2009 could contract as much as 4-5 percent if the country’s domestic political turmoil persists, as it would erode the confidence of investors, consumers and tourists alike, she said.

The current political unrest could delay government budget disbursements intended to stimulate the economy, she said.

Because of the unfavorable economy, the central bank now projects public consumption growing a maximum of 0.5 percent or even contracting a further 0.5 percent, private investment contracting around 12-14 percent and imports to dwindle 31.5-34.5 percent, she said.

Thailand’s trade balance is expected to be in surplus by US$ 10.5-13.5 billion and the current account would be in surplus of US$ 11.5-14.5 billion, Miss Duangmanee said.

It is hoped that the global economy would begin to recover mid-2009, she said, adding that if the forecast materializes, Thailand’s GDP would land in the black by 1.5-3.5 percent. (PNA/TNA)

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