Production Hub
“Thailand positioned itself as a production hub for hard disk drives for so long, but didn’t do anything to get foreign companies to invest in modern technology,” said Thanomsri Fongarunrung, an economist at Phatra Securities Pcl in Bangkok. “Demand for PCs has fallen with increased demand for smartphones, and we never fully recovered the share lost to other markets after the 2011 floods.”
The NESDB today said export value this year will probably be flat, and that it expects the value to grow 4 percent next year. The economy may expand 3.5 percent to 4.5 percent in 2015, the agency said.
The monetary authority kept its policy rate unchanged at 2 percent earlier this month, and Governor Prasarn Trairatvorakul said last week that while the current rate is accommodative for growth, it can be eased further if the economy fails to recover.
“The soft 3Q GDP print raises the odds of a more dovish monetary policy statement,” said Weiwen Ng, a Singapore-based economist at Australia & New Zealand Banking Group Ltd. “If this sluggish pace of growth persists, the window for easing could potentially be opened,” he said, adding that exports aren’t likely to provide a material boost to growth.