thai growth weakest since .......

[yartims]

https://uk.yahoo.com/finance/news/thail ... 40819.html

(Bloomberg) --

Thailand’s economy grew at the slowest pace in almost five years in the second quarter as exports and tourism were buffeted by U.S.-China trade tensions and a strong local currency.

Gross domestic product rose 2.3% from a year ago, down from 2.8% in the first quarter, the National Economic and Social Development Council said Monday. That’s the slowest pace since the third quarter of 2014. The expansion matched the median estimate of 2.3% in a Bloomberg survey of economists.

A slowdown both domestically and abroad affected the quarterly growth, Thosaporn Sirisumphand, the council’s secretary general, said at a briefing in Bangkok. The U.S.-China trade war, global jitters and a drought all remain as risks going forward, although a government stimulus package announced last week could help offset the damage, he said.

Thailand’s trade-reliant economy has been hit by slumping exports, a surging currency and cooling tourist arrivals, with a looming delay in the budget since a new government took office last month posing a further risk. The central bank unexpectedly cut its benchmark interest rate earlier this month for the first time in more than four years, and said it sees more room to ease ahead.

Downside Risks

The economic council cut its full-year growth forecast to 2.7%-3.2% -- down from an earlier estimate of 3.3%-3.8% -- as the second-quarter pace should be the slowest this year, the council’s deputy secretary-general, Wichayayuth Boonchit, told reporters. The forecast for exports was cut to a 1.2% contraction, from previous estimates of 2.2% growth.

After the release of Monday’s data, Bank of Thailand Governor Veerathai Santiprabhob said the monetary authority will likely cut its 2019 economic growth forecast at the September policy meeting. The central bank currently estimates 3.3% expansion for 2019.

The sustained decline in export gains has spilled over to domestic demand, Nomura Singapore Ltd. economists Euben Paracuelles and Charnon Boonnuch wrote in a research note Monday. They maintained their expectation for full-year GDP growth of 3.0%, but added that "the balance of risks to our forecast remains tilted to the downside."

Gareth Leather, senior Asia economist at Capital Economics, said the expansion could slow to 2.5% this year.

"With weak global demand and a downturn in the tourism sector likely to drag on growth prospects over the coming quarters, we expect the economy to remain weak," he wrote in a research note.

[AlexO]

Well there is a surprise. You can get the same prediction in Day and Night every day and it does not cost thousands.

[TJ]

Sony, Harley-Davidson, Others Move Production from China to Thailand

Thai officials glimpse a silver lining in the U.S.-China trade war as companies such as Sony Corp. move production to Southeast Asia’s second-largest economy. At least 10 firms are in the process of relocating some production to Thailand from China, according to the National Economic & Social Development Council. More than a dozen others could potentially choose Thailand, it said in a statement.

“We may not see the impact on the economy now, but in the second half of 2019, it could become a positive factor for growth,” the agency’s Deputy Secretary-General Wichayayuth Boonchit said Monday.

Trade tension is sapping growth in Asia’s export-dependent economies, sparking calls for looser monetary and fiscal policies. Nations such as Vietnam, Indonesia and Thailand are also vying to lure investment from manufacturers seeking to escape U.S. tariffs on imports from China.

The 10 firms moving some manufacturing to Thailand include Sony, Sharp Corp., Harley-Davidson Inc. and Delta Electronics Inc. Most have finalized locations near Bangkok or in the Eastern Economic Corridor development zone on the east coast of Thailand, according to the economic and social development agency.

[Stantheman]

I dought there will be much of an impact this year on the companies moving production from China to Thailand due to the embargo. There will be factories to build, employees to train and components to stock prior to any new meaningful manufacturing starting.

[Giggle]

The dubious honor of Asia's premiere sweatshop slipping from China to Thailand. I thought it would be India, but no.

Ahhh paradise.

[UdonExpat]

As Thailand continues to develop and improve its infrastructure so will Thai wages increase and the inevitable inflation that goes hand in hand with capitalism. Consequently, those on fixed incomes will find their buying power deteriorating over time. Weak growth expands the time frame for increasing costs and strong growth shortens it.

[yartims]

https://www.ft.com/content/5d3e6e20-c33 ... 6ca66511c9

Thailand unveils $10bn stimulus for struggling economy
Package approved after kingdom reports slowest rate of growth in five years


Analysts said that while the stimulus measures would inject more money into the economy, their impact might be limited because of the souring outlook for the global economy and Thailand’s own struggle to tackle bigger problems around skills and competitiveness.

“This stimulus package . . . only looks at the fast distribution of money into the system,” said Pavida Pananond, an associate professor at the Thammasat Business School in Bangkok. “This stimulus is good for the short term, but I don’t think it would address the root cause of the problems in the Thai economy, which would require much more profound structural reform.”

Thailand’s central bank said on Monday that it would lower its 2019 growth forecast of 3.3 per cent because of escalating trade protectionism.

[Chuchi]

https://www.bloomberg.com/news/articles ... st-in-asia

[pipoz4444]

Thaivisa Report or Comment, which is pretty much what everyone knows or expects

""Gross domestic product is forecast to contract 8.1% this year, according to the Bank of Thailand. Worse than official forecasts for any of the main economies across Asia and would be Thailand’s biggest GDP decline ever, surpassing even its plunge during the Asian financial crisis two decades ago.

“Thailand has large exposure as a tourism hub, close to 15% of GDP, and it also has large exposure of the export-oriented sector,” said .................., senior economist for Thailand at the World Bank. “Hence the large shock to GDP.""

So why doesn't the TB weaken . It's not as though the TG have Billions and Billion in their Reserve Bank to prop up the Baht.

Maybe, it is like hanging onto the edge of a cliff and one day you let go. Meaning the TB takes a sudden big drop when someone really has a look at the numbers (Forecast Revenues) and whats left in the Reserve Bank.

Opp's Chuchi, didn't realize it was the same text as in your LINK

pipoz4444

[AlexO]

Who teaches these people. Tourism is 15% of GDP and not coming back this year at least and exports are down the dunny but overall GDP will only contract 8.1%???. There is a major financial tsunami coming and the General and his pals are kidding people on that everything in the lotus garden is okay.

[Whistler]

Spot on Alex.

Thailand and Malaysia stand out in SE Asia as developing nations, but Thailand has a greater dependency on tourism. Manufacturing was building, now companies like Toyota are laying off staff, running under capacity, GM shut so this sector that was fueling growth has weakened a lot. Then tourism, I understood it was bigger than 15% of GDP, it must have dropped by over 90%, domestic consumption way down.

This must eat into the 200 Billion in foreign reserves. GDP for 2019 was around 530B USD, so for every 10% drop in GDP, the country is around $50B worse off. What will we see? Probably between 10 and 20 percent.

The strong THB must take a battering, I know farangs have been saying this for years, now I think it will actually happen.

[AlexO]

Whistler, we were on a wee holiday before daughter was going back to school 1st July. Pattaya absolutely dead, really dead. Koh Chang ok in the resorts but not busy at all outside, lots of hotels still closed. Was on White Sands Beach and lucky if there was 50 people on it. Bangkok most hotels still closed and very few eateries open. We were in Silom and no night market and all the Soi's really quiet. Its going to be a long road back. One owner where we ate said at least 30% will never open again.

[Whistler]

A very interesting website that clearly takes the view that Thailand's debt will balloon with a currency crisis

https://commodity.com/debt-clock/thailand/

[Laan Yaa Mo]

A very interesting website that clearly takes the view that Thailand's debt will balloon with a currency crisis

https://commodity.com/debt-clock/thailand/

The debt is going to increase in most countries in the world although it is doubtful if China and North Korea would ever admit to it.

[Doodoo]

The debt will increase in ALL Counties. When have we ever heard of a debt staying the same or decreasing??? admitting it or not.

[papafarang]

A very interesting website that clearly takes the view that Thailand's debt will balloon with a currency crisis

https://commodity.com/debt-clock/thailand/

The debt is going to increase in most countries in the world although it is doubtful if China and North Korea would ever admit to it.

Dept will increase in all countries , people not working still pay bills , China has already said they have bigger debt , and I'm not sure north Korea even have banks to borrow from, mind you Chinese and Korean debt does not have any effect on us . I think you should consider Canadian debt after all you're going to have to pay for it eventually.

[pipoz4444]

I presume that you are referring to "External Debt" or what is often referred to as Foreign Debt.

Namely, the component of total debt held by Creditors of Foreign Countries (i.e. non-residents of the debtor's country), borrowed from foreign lenders,such as commercial banks, governments, or international financial institutions.

pipoz4444

[papafarang]

I presume that you are referring to "External Debt" or what is often referred to as Foreign Debt.

Namely, the component of total debt held by Creditors of Foreign Countries (i.e. non-residents of the debtor's country), borrowed from foreign lenders,such as commercial banks, governments, or international financial institutions.

pipoz4444

That's what I was thinking ,a country can't really borrow from itself ,international banks fund the borrowing . I wonder how much more the banks will OWN us after its all over. I remember a meme saying the whole world was in debt to the tune of 212 trillion dollars, but to who ?...oh yeh banks

[the-monk]

No where in this article it is mentioned that Thailand's debt to gdp ratio has become a problem. The ratio remains in the 40 % range, much better than most industrialized countries. USA ?? % Japan 200% etc. With the trillions borrowed by the USA, and with a gdp down 10 % or more the USA position looks worst than Thailand which should have a gdp down a few percentage points. Countries that managed well their COVID crisis will come up on top, the future is ASIA,

[pipoz4444]

I presume that you are referring to "External Debt" or what is often referred to as Foreign Debt.

Namely, the component of total debt held by Creditors of Foreign Countries (i.e. non-residents of the debtor's country), borrowed from foreign lenders,such as commercial banks, governments, or international financial institutions.

pipoz4444

That's what I was thinking ,a country can't really borrow from itself ,international banks fund the borrowing . I wonder how much more the banks will OWN us after its all over. I remember a meme saying the whole world was in debt to the tune of 212 trillion dollars, but to who ?...oh yeh banks

Hi Papa,

It sort of can borrow from itself, if it want to run its printing presses 24 hours a day and just print endless reams of money. Only to wake up one day, like the Zimbabwean Dollar or the Iranian Rial or even the Indonesian Rupiah, were nobody wants it outside of that country or even inside the country for that matter.

Plenty of lunatics have suggested, just printing endless money in the past, to stabilize their economies and Australia has had its their share of them. Clearly these people never went to school or if they did, they failed to pass kindergarten.

pipoz4444