The World Bank still has confidence that the Thai economy would grow by
4.5 per cent this year, as previously projected, the bank’s senior economist
Kirida Paopichit said on Wednesday.
A major positive factor that
would boost economic growth in the second half of the year was the full
recovery in the industrial sector after it was severely hit by the great flood
late last year, while, the impact of the eurozone debt crisis on the export
sector was still minimal, she said.
Ms Kirida said the growth figure in
the fourth quarter of the year would be much higher than the same period last
year, when industry was hit by the devastating flood.
Foreign direct investment would
continue to flow into Thailand because it is an attractive investment
destination for foreign investors on the back of its strong economic
fundamentals, she added.
However, the senior economist
warned that the government should review its policy on trade and investment in
the service sector.
The government is too protective
and this had led to a slow expansion in the service sector compared to the
industrial sector, she said.
Under the Asean Economic
Community agreement, which will take effect in 2015, all member countries must
open up the service sector.
In that year Thailand would be
required to allow foreigners to take up to 70 per cent of total of investment
cost, up from the current 51 per cent. Thailand was moving too slow in boosting
the service sector, said Ms Kirida.
She called on Thai manufacturers
to consider the debut of the AEC as a competitive opportunity, not a risk.
Deputy Commerce Minister Phum
Sarapol said on Wednesday the Ministry of Commerce will not revise its 2012
export growth projection of 15 per cent even though exports in the first half
of the year were below expectation.
The minister admitted the
continuing global economic slowdown has hurt the export sector.
Mr Phum said in order to achieve
the set export growth target, his ministry would support Thai exporters,
particularly small and medium enterprises (SMEs), in increasing exports in the
second half of the year.
Special working teams comprising
representatives from both the public and private sectors would be set up at all
levels to find ways to sell more Thai products, he added.
The ministry would also ease
export regulations to facilitate exports and coordinate with financial
institutions to ensure the SMEs had good access to funding sources, he said.
“There are several months left
for the ministry to work on achieving the 15 per cent export growth target this
year. However, the negative factors hurting the export sector are external and
the government can only come up with measures to minimise their impact,” Mr
Phum said.
Nantawan Sakuntanak, director
general of the Export Promotion Department, said the export problem this year
was caused by the decline in global demand.
Exports information from
neighbouring countries in Asean showed that their exports had also dropped.
This reflected the fact that the
global economy was in a recession, due to the eurozone debt crisis, the fragile
US economy and the slow recovery in Japan, she said.
Mrs Nantawan said special working
groups of her department were studying the problems of four major export
businesses -- textiles, food, agriculture and jewellery -- with the aim of
finding suitable ways out.
The final proposed solutions for
these key industries would be forwarded to the prime minister for consideration
and for the government to come up with a policy to support exporters and to
boost exports in the second half of the year, she said.
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