Thailand Likely To See New Govt In Q3, Economy Faces Slow Growth

BANGKOK, April 24 (Bernama) -- Thailand needs a new government with full power to drive the country's economy towards strong growth, but it is likey to achieve that only in the third quarter of this year, according to a prominent businessman. Isara Vongkusolkit, chairman of the Board of Trade of Thailand and the Thai Chamber of Commerce (TCC), said the private sector still does not know the date of the upcoming general election and the country faces the prospect of slow growth amid a power vacuum as the caretaker government under Prime Minister Yingluck Shinawatra only has limited power to make decisions. Issara said with no new government, Thailand's economy in the first half of the year is projected to grow only 2.5 per cent, the slowest growth in three years. He said Thailand needs to have a new government to fully administer the country and approve projects. The chamber pointed out that Thailand's economy is expected to decline by one per cent in the first quarter of this year and grow in the second quarter by less than one per cent due to the political conflict and absence of a government with authority to make decisions. Sales of retail and wholesale business have dropped by 30 per cent due to lower purchasing power, while sales of property and real estate as well as the tourism sector also face a slow growth. In order to promote growth in the current situation, promoting cross-border trade has been suggested as a way to encourage export growth. The chamber projects cross-border trade between Thailand and four countries -- Malaysia, Myanmar, Cambodia and Laos -- to grow by 7-10 per cent this year, higher than the country's average export growth projection of five per cent. Last year, border trade was valued 924.24 billion baht (about US$28.5 billion). The chamber also suggested the government allow the private sector to invest in the development of border checkpoints to encourage border trade. Isara said with private investment, the border checkpoints could be developed faster compared with waiting for the government to do it. The chamber said to develop border checkpoints in the country, about 10 billion baht (US$309.1 million) is needed to expand roads from one lane to two lanes. It said temporary border checkpoints should also be upgraded to permanent checkpoints to extend operating hours for trading and allow greater movement of people. Isara acknowledged that without a government, Thailand would not be able to develop border checkpoints in time for the implememtation of the Asean Economic Community (AEC) by the end of 2015. Niyom Wairatpanij, chairman of the Economic Cooperation with Neighbouring Countries Committee under the Board of Trade, said under the plan for private sector participation in border checkpoint development, the government will still have the authority to manage the cross-border trade. Private investors will collect fees for border trading, Niyom said. He identified 10 temporary border checkpoints in the provinces to be upgraded to permanent checkpoints. Thailand now allows only 34 permanent border checkpoints in the country. -- BERNAMA