Published on December 29, 2007
It pointed out that sound economic growth and stability had already been delivered by the military-installed government.
Senior director Amara Sriphayak said the Kingdom's economic growth this year would not be less than 4.5 per cent, considering the economic indicators over the past 11 months. The central bank earlier forecast this year's economic growth at 4.3-4.8 per cent.
Moreover, economic stability has proven strong with a current account surplus of US$13.3 billion (Bt449 billion) for the first 11 months, significantly higher than the previous projection of $8.5 billion to $9.5 billion. "The present government boosted the economy quite efficiently, reflected by the economic figures, so the new government will have good economic conditions to manage," Amara said.
She said the new government was expected to conduct a budget deficit as endorsed during political campaigning. The new government, however, should focus mainly on boosting investment rather than consumption.
"If the new government continues policies that the current government has followed, such as infrastructure projects, that will encourage private investment," said Amara.
However, the economy continues to face risk factors like oil price hikes and the US sub-prime mortgage crisis.
The BOT said domestic demand had gradually picked up since the third quarter, while exports had registered fresh record highs several times, growing at a higher-than-expected pace.
The Private Consumption Index has gradually picked up, with 3.7 per cent growth last month, compared with 2.7 per cent in October. However, the index for the first 11 months rose only 1.3 per cent, lower than 2.4 per cent for the last entire year.
"The index expanded increasingly in the third quarter, although consumption slowed down this year," said Amara.
The newly adjusted Private Investment Index expanded 3.5 per cent last month, higher than 2.3 per cent in October. It contracted 1 per cent in the first 11 months, compared with 2-per-cent growth for all of last year.
In the first 11 months, exports rose 18 per cent year on year, higher than the 17-per-cent growth for all of last year and a 13-15-per-cent projection for this entire year.
Amara said exports could grow at higher pace next year, depending on the global economy and the new government's policies.
Higher-than-expected exports have brought about a huge current-account surplus, causing the baht's appreciation.
Amara said improved domestic demand would bolster imports and reduce the current-account surplus.