Thai economy begins to signal recovery

BANGKOK, July 30 (TNA) – The Thai economy in June, and the rest of the second quarter of this year, began to show signs of recovery, with the production sector shrinking at a slower pace and purchase orders from overseas increasing, according to the Fiscal Policy Office (FPO).

FPO Director-General Somchai Sajjapong said private consumption and exports showed signs of improvement from earlier contraction, but private investment continued shrinking.

The economy had stabilised with the unemployment rate declining and employment in the production sector picking up. Simultaneously, the country’s international reserves remain at a healthy level.

Given these positive factors, the FPO believes the economy had already bottomed out in the first quarter of this year and contracted more slowly in the second quarter.

It is expected the economy will further recover in the third quarter and resume positive growth in the fourth quarter.

He said FPO will revise the country’s gross domestic product (GDP) for 2009 in the next two months. It had earlier forecast GDP would contract 3 per cent this year.

Now, various economic figures stay volatile, but there are positive aspects to the economic growth. As the economy now signal recovery, he said, FPO sees a need for private companies to prepare for investment expansion.

They should not wait until the economy recovers because it might be too late.

He advised the government to accelerate spending to ensure it meets its target, and forge ahead with implementing Thailand’s investment projects under the Thai Khem Kaeng (Stronger Thai) slogan to lead the way for private companies to decide to increase investment because the investment in the second quarter remained worrying. (TNA)