Thai economy expected to be affected by global turbulence for 2 more years
Thailand’s economy will be affected by global economic turbulence, which may for last two years, during which growth in Thai exports will contract while domestic inflation will increase, said Kobsak Pootrakool, former Prime Minister’s Office Minister and, currently, senior executive vice president of the Bangkok Bank, yesterday (Saturday).
Speaking about “Economic Turbulence 2022 and How to Cope with It”, he said that all countries must be prepared to cope with the consequences of international geo-political conflicts, energy and food crises, turbulence in global capital and financial markets and an economic slowdown in China.
These will impact emerging markets and the economy of Thailand for the next 1-2 years and will slow Thai exportgrowth, which recorded a 20% increase last year.
He noted, however, that the Thai economy will get a boost from tourism recovery, with an expectation that the number of arriving tourists for the rest of this year will increase to about one million per month.
To arrest inflation, Kobsak said that the Bank of Thailand aims to increase the policy rate by 0.25% three times, from 0.5% to 1.25%, by the end of the year.
He also said that the increase in the policy rate will help slow down the reduction in Thailand’s foreign reserves, which have now fallen to US$215 billion, from US$260 billion.
He said that the central bank has been closely monitoring domestic inflation, which was 7.66% in June, adding that average inflation is 2.58%, which is not high.
He pointed out that energy prices are showing signs of easing, saying that the price of crude oil has now dropped to US$90-100 per barrel, compared to the peak of between US$130 and US$140.
As far as Thailand is concerned, Kobsak said that, while there is economic turbulence, there are opportunities for Thailand to increase investment and to create new opportunities, such as in the electric vehicle, alternative energy y, modern logistics and food industries.
For the public in general and investors, he suggested that they keep themselves abreast of the latest economic situation, in order that they can make the right assessments.