WB raises Thailand's economic growth projection to 4.7% in 2012

BANGKOK, December 19 (TNA) - The World Bank has revised its projection on Thailand's economic growth this year, from 4.5 per cent to 4.7 per cent, thanks to rising domestic consumption and investment in the wake of the country's flooding crisis late last year. Kirida Bhaopichitr, World Bank's Senior Economist for Thailand's office, said on Wednesday that the rising domestic consumption and investment attributing to the upward projection of Thailand's economic growth in 2012, have resulted from the government’s economic stimulus measures and capital inflows. Kirida acknowledged that the positive factors have cushioned impacts from a drop in Thailand's export growth, from 9.5 per cent last year to 3 per cent in 2012, due to a slowdown in global trade. The US-based World Bank has also forecast that Thailand’s economic growth in 2013 should now stay at sone 5 per cent due also to the post-flood sharp production recovery, amid the rebounding world economy, and Thai exports next year should expand by 5.5 per cent, private and public investment by 8 per cent and 15 per cent respectively and private and public consumption by 3.6 per cent and 3 per cent respectively; while the country's inflation in 2013 is expected to stand at about 3 per cent and interest rates at about 2.75 per cent, almost the same as 2012. Kirida cautioned, however, that the persisting economic crisis in Europe, along with Thailand’s political uncertainties, as well as the government-supported daily minimum wage hike and the rice pledging scheme, could affect Thai exports in 2013. Kirida noted that the daily minimum wage hike to 300 baht equally in all areas across the country as of January 1, 2012 should raise Thailand's daily minimum wage by 22.4 per cent on average, compared with the level in 2012, which is considered extremely high when compared to wage increases in the past which rose only by 2.5 per cent on average. In order to cushion the, probably, negative impacts on the Thai economy, Kirida suggested that the Thai government help develop Thai workers’ skills, which could result in bringing in those disadvantaged people in the society to participate in the national economic development. (TNA)