Negative Tsunami effect, oil prices and inflation picking up pace, improved automobile, electronic exports and tourism may push growth up at end of year.
Economy: Growth declines to 2.6% in Q2, Supply disruptions take toll on exports by Chatrudee Theparat
Economic growth this year has been revised down to a range of 3.5% to 4% from the previous projection of 3.5% to 4.5% due to the impact from the slow global economy.
Growth decelerated in the second quarter of this year to 2.6% after auto and electronic exports had dropped as a result of the supply chain disruption following the earthquake and tsunami in Japan.
Global economic growth was revised down to a range of 3.6% to 4% this year from between 3.8% and 4.2% earlier as a result of the debt crises in the US and Europe, especially in Spain and Italy.
The Thai export growth projection was in turn cut to 16.5% from 17%.
The National Economic and Social Development Board (NESDB) yesterday lowered its economic growth forecast even though Thai exports to the troubled markets account for only 10% of the total. The country's main markets in Asia remain promising.
However, capital inflows to Asia have strengthened the baht, projected in the range of 29.50 to 30.50 baht to the US dollar.
Oil prices are expected to soar with Dubai crude projected at US$103-107 a barrel this year, an upward revision from $98-107.
NESDB secretary-general Arkhom Termpittayapaisith said inflation was revised up to the range of 3.6% to 4% from 3% to 3.8% due to the high oil prices.
New government investment could be delayed until next February, resulting in a possible 1.5% year-on-year contraction this year, compared with 3.5% growth in the previous projection.
The second-quarter 2.6% growth was a 0.2% contraction from the first quarter, when the economy grew by 3.2% year-on-year. The quarterly economic growth rates last year were 12%, 9.2%, 6.6% and 3.8%, respectively.
The slower second-quarter growth was caused by lower exports of automobiles and electronic products in the aftermath of the march 11 Japanese disaster. Thailand is the largest automobile production base in Southeast Asia.
Jewellery exports to the US and Europe also dipped while government expenditures contracted by 9.9%.
First-half economic growth was 2.9%, but the government's think-tank agency forecast 5% expansion for the second half, supported by improved automobile and electronic exports.
On a bright note, Mr Arkhom said the tourism sector would grow at a faster pace this year, with a projection of 19 million foreign visitors, up from 18 million.
The agency has yet to project the growth figure for next year, but it is possible that the government's policy of increasing incomes and spurring domestic consumption will help to drive growth up by one percentage point.
Meanwhile, Citigroup suggested currency investors buy Indian rupees, which have been a big underperformer, and sell baht due to economic growth concerns.
The 2.6% second-quarter growth was a full percentage point lower than the median estimate of 3.6% by economists surveyed by Bloomberg.
Wellian Wiranto, an HSBC economist, said the second-quarter gross domestic product came much softer than expected, driven primarily by supply chain disruptions that hurt exports and pre-election caution that hurt investments.
(Source: Bangkok Post, Economy: Growth declines to 2.6% in Q2, Supply disruptions take toll on exports, 23/08/2011, Chatrudee Theparat, link)
disruptions - when an activity is stopped by some event
supply disruptions - when the supply of some goods (like Japanese exports) is slowed down by some event
toll - the damage done in some bad event; normally the number of people killed or injured in an accident or disaster, but in this case, it refers to the number of job losses
X takes toll on Y - X causes damage to Y
economic growth - the percentage that the economy is growing bigger each year (must be high for people's incomes to be increasing)
revised - changed เปลี่ยนแปลง
revised down - changed, lowering the amount
range from X to Y - from the number X to the number Y
projection - a calculation or guess about the future based on information that you have การคาดคะเน
impact - an effect or influence ผลกระทบ
global - throughout the world ทั่วโลก ทั้งโลก
Growth decelerated - grew at a slower rate than before
second quarter - the 4th, 5th and 6th months of the year
supply chain - all the steps of producing a good from factory to factory to store
disruption - prevented from operating normally; a situation in which something cannot continue because of a problem การขัดขวาง, การหยุดชะงัก
supply chain disruption - when the process of producing goods is stopped for a time by some event like the Tsunami
earthquake - a sudden shaking movement of the ground แผ่นดินไหว
debt - an amount of money that you owe หนี้
debt crises - when governments can't pay back all the money they borrowed (so the loan terms have to be renegotiated or a bailout rescue package has to be put together)
forecast - a statement about what will happen in the future based on information available now พยากรณ์
economic growth forecast - what experts think that economic growth will be in the near future
troubled markets - economies such as Greece that are going through economic problems
promising - the future looks good; likely to be successful มีแนวโน้มที่ดี
remain promising - the future still looks good (no change)
capital - the money of owners invested in a business (See glossary)
capital inflows to Asia have strengthened the baht - investment money coming into Asia (exchanging into Asian currencies (demand) have pushed Asian currencies up in value, which means exchange rate against dollar falls, example: falls from 32 to 29 baht to the dollar)
projected - expected, forecasted, the amount that experts believe (or forecast) for the future
expected - believe will happen คาดว่า (จะเกิดขึ้น)
soar - to rise very quickly to a high level มีความหวังสูง,พุ่งพรวดขึ้น
barrel - the metal can that oil is stored in
revision - a change, improvement or addition that someone makes to something like a plan or document การปรับปรุงใหม่, การแก้ไขใหม่
inflation - the level of prices rising in the economy as a whole (See Wikipedia and The Economist glossary) ภาวะเงินเฟ้อ
investment - taking your money and putting it into projects to make a profit or earn interest (buying stock shares, bonds, real estate)
year-on-year - a period this year (month, quarter, half-year) compared to the same period last year
contraction - decreasing in size, shrinking, growing smaller
in the aftermath of ... - after a big bad event ...
disaster - something very bad that happens and causes a lot of damage or kills a lot of people ความหายนะ ภัยพิบัติ
base - a place from where an activity can be planned ฐานที่มั่น
automobile production base - a place where there are a lot of factories for making cars
dipped - went down
contracted - became smaller, shrunk
think-tank - an organization or institute with a lot of PhD experts that does research and prepares reports on certain subjects
expansion - when something increases in size, number or importance การขยายออก
On a bright note ... - mentioning something that will make you happy ....
sector - a part of the economy ภาคเศรษฐกิจของประเทศ (public sector = government, private sector = all businesses, household sector = families and consumers, banking sector,...) (See Wikipedia)
tourism sector - all the tourism-related businesses in the country
pace - the speed at which something happens ท่างทำนอง ย่างก้าว จังหวะ ที่สิ่งต่างๆ ดำเนินไป (See glossary)
grow at a faster pace - when the economy grows faster (incomes getting bigger)
figure - an amount จำนวน
project the growth figure - say what you think the amount of growth will be in the future
policy - a set of plans or action agreed on by a government, political party, business, or other group นโยบาย a plan of action to guide decisions and achieve outcomes (See Wikipedia)
domestic - within the country ภายในประเทศ
consumption - money spent by households and families on goods and services (See Wikipedia) การบริโภค
spurring domestic consumption - causing consumption inside the country to grow
drive growth up - increase growth
currency - a widely used the money accepted for exchange of goods in an economy เงินตรา (See Wikipedia)
buy - accept the truth of ยอมรับ, เห็นด้วยกับ (ความคิด, คำแนะนำ, ข้อเสนอแนะ)
underperformer - hasn't been as well as it could do (could do better)
concerns - worries ความกังวล
economic growth concerns - worries about whether the country will continue to grow fast enough (to meet all the needs)
median - the middle item in a set of items arranged in order
estimate - to say what you think an amount or value is or will be, either by using available information or by guessing คาดคะเน โดยประมาณ
gross domestic product - the total value of goods and services produced in a country in one year
election - the process of choosing a person or a group of person for a position, especially by voting elect (v) electoral (adj) synonym: the polls การเลือกตั้ง
pre-election caution hurt investments - investors didn't know how the election would turn out, so they delayed or canceled investments
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