THAILAND ECONOMIC MONITOR
SUMMARY
The Thai economy has been recovering slowly from the Global Financial Crisis compared to
countries like Malaysia and China. Growth in 2013 is projected to be 3 percent with slower than
expected performance in all components of GDP – consumption, investment, net exports and
government spending. While some of the weakness in exports can be explained by the structure of
production - falling global PC sales relative to tablets may have reduced exports of hard disk drives,
sectors such as agro-products and metals have also performed poorly. The weakness in household
consumption is partially explained by tax incentives for car purchases that expired at the end of 2012
and led to preponing of consumption. The fast growing levels of household debt, more rigorous macro
prudential measures by the Bank of Thailand, and arrears in payments on the Paddy Pledging
Program1
have also been contributing factors. The slowdown was evident by the third quarter, before
the protests began. The protests are unlikely to have had a significant macroeconomic impact in 2013.
THAILAND ECONOMIC MONITORSUMMARYThe Thai economy has been recovering slowly from the Global Financial Crisis compared tocountries like Malaysia and China. Growth in 2013 is projected to be 3 percent with slower thanexpected performance in all components of GDP – consumption, investment, net exports andgovernment spending. While some of the weakness in exports can be explained by the structure ofproduction - falling global PC sales relative to tablets may have reduced exports of hard disk drives,sectors such as agro-products and metals have also performed poorly. The weakness in householdconsumption is partially explained by tax incentives for car purchases that expired at the end of 2012and led to preponing of consumption. The fast growing levels of household debt, more rigorous macroprudential measures by the Bank of Thailand, and arrears in payments on the Paddy PledgingProgram1have also been contributing factors. The slowdown was evident by the third quarter, beforethe protests began. The protests are unlikely to have had a significant macroeconomic impact in 2013.
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