Balance is key to sustainable economy, Kittiratt tells seminar
The government is geared towards a balance of economic growth, income distribution and price stability to avoid imbalances that could spark a crisis like those in the United States and Europe, Finance Minister Kittiratt Na-Ranong said.
Speaking at a seminar titled “Thailand Economic Outlook 2013” yesterday hosted by Siam Commercial Bank and Krungthep Turakij, he said that in the past many countries had focused solely on growth. The Thai government, however, is committed to a balanced economy for sustainable growth.
He said there were four pillars on which to achieve this goal: increased export through opening of new markets, a strong fiscal position, promotion of private investment, and boosted domestic consumption.
On the fiscal position, he said the budget deficit in the 2014 fiscal year would be narrowed to Bt225 billion or 2 per cent of gross domestic product, “which will make Thailand one of the countries with the lowest deficit-to-GDP ratios”. The deficit in the 2013 fiscal year is set at Bt300 billion. The government is also committed to achieve a balanced budget in 2016.
Foreign-exchange and interest policies will be deployed to create a favourable environment for investment, aside from the cut in the corporate-income-tax rate.
“The global economy has been facing problems and we need to design the Thai economy to be in balance with the four mechanisms. The global economic problems will ease in the next years and the Thai economy will benefit with complete infrastructure and economic stability,” Kittiratt said.
Virabongsa Ramangkura, chairman of the Bank of Thailand and of the Strategic Committee for Recon-struction and Future Development, said the central bank expected the Thai economy to see 5.7-per-cent growth in GDP this year and another 4.6 per cent next year.
The good news is that there are positive signs of a quicker recovery of the global economy than previously estimated by economists, he said. The most significant signal is the use of new ways of extracting oil and natural gas in the United States. Such advanced methods will cause the price of oil in the world market to be reduced.
The current price of crude oil is US$86-$87 per barrel. In the long term, Virabongsa said, the US would become a global energy exporter with bigger oil production capacity and reserves than Saudi Arabia.
“As one of the leading exporters of oil and other energy products, the US will be able to settle its monetary and financial problems,” he said. “The economic situation of the US itself has already passed the minimum point and once it begins improving, exports from Europe to the US will also improve, ” he said.
