Thai Chamber forecasts economic growth of 2-3 per cent
June 21, 2014 00:00 By Petchanet Pratruangkrai
The Thai Chamber of Commerce projects that gross domestic product will grow by between 2 and 3 per cent this year, amid clearer signs of economic recovery and investment from overseas.
The Commerce Ministry’s Business Development Department has given approval to 186 foreign companies to set up operations in Thailand under the Foreign Business Act so far this year, indicating that more foreign businesses want to operate in the Kingdom.
The economy is expected to grow by 2.5 per cent this year, Thai Chamber of Commerce chairman Isara Vongkusolkij said yesterday, taking the middle of the organisation’s forecast range.
“Private enterprises from various sectors, such as investors in stock markets and foreign investors in the real sector, have more confidence in Thailand’s moving-forward policy,” he said.
Credit-rating firms have not downgraded Thailand’s sovereign rating, showing that the country has high stability, he added.
Moreover, the problem of tens of thousands of foreign workers having moved back to their home countries, and to Cambodia in particular, is only having a short-term impact on the manufacturing sector as the majority of those workers have already returned to the Kingdom, said the chamber chief.
There had been a misunderstanding among foreign labourers in the Kingdom that the Thai authorities planned to crack down on them, but this has now been resolved. Many of those workers who fled the country have now returned, and the industries affected by their absence will be able to get back to normal operations soon, Isara claimed. Thanavath Phonvichai, director of the chamber’s Economic and Business Forecasting Centre, said the economy had shown clear signs of recovery in the month since the military coup on May 22, while the full payment of money owed to rice farmers under the pledging scheme would help stimulate domestic consumption. Although the Bank of Thailand estimates that GDP will grow by only 1.5 per cent this year, the forecasting centre believes an expansion rate of 2-3 per cent can be achieved in light of the many stimulus measures planned by the junta, he said.
Meanwhile, the approval of 186 foreign companies’ applications to invest in Thailand so far this year is 5 per cent higher than the number approved in the same period last year, said the Business Development Department.
The value of these companies’ initial investment capital is Bt7.37 billion, which is some 30 per cent lower year on year.
Pongpun Gearaviriyapun, director-general of the department, said first-half approvals would result in the creation of about 1,990 jobs for Thais.
Foreign investors are still interested in setting up businesses in Thailand, and more firms are expected to set up in the country under a clear policy to promote investment, she said.
This month alone, 35 firms have been approved under the act, representing a 9-per-cent increase from the May level. The value of initial capital investment rose 72 per cent month on month to Bt1.06 million.
Pongpun added that June approvals would create at least 260 new jobs.