WB forecasts 0.5% export growth
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The World Bank forecasts 0.5 per cent growth rate for Thailand's exports in 2015.
As exports should recover in the second half, higher tourism revenue as well as public investment should help the economy register a 3.5 per cent growth rate this year, said Kirida Bhaopichitr, the economist of World Bank Thailand, at a press conference.
The export growth could rise above 0.5 per cent if the Thai baht weakens below the average exchange rate forecast of 33.50 per US dollar, she said.
Yet, World Bank emphasised on the competitiveness of Thailand's manufacturing sector. As old export champions no longer prosper, Thailand needs to boost productivity and competitiveness, she said.
Thailand's exports during 2006-2011 expanded 13 per cent per annum on average. Growth rate was below 1 per cent during 2012-2014.
Meanwhile, Kirida brushed aside concerns that the Thai economy would experience deflation, citing that negative inflation is caused mainly by falling oil prices.
"Falling oil prices should be good news. We should not be worried about deflation," she said.
According to the Thailand Economic Monitor 2015, released today by the World Bank Group, the Thai economy grew by 0.9 percent in 2014, as domestic demand was dampened by political turmoil in the first half of the year and exports fell amid lower demand from China and other large Southeast Asian countries.
Due to falling exports, the World Bank report notes that raising the skills and productivity of the labour force are central to improving Thailand’s competitiveness, and identifies education reform as a priority. Thailand has made great progress in expanding basic education and improving attendance in both urban and rural schools. Virtually all Thai children today attend primary school, and 70 per cent of poor families are able to send their children on to secondary school compared to only 10 per cent 25 years ago.
More can be done to provide a quality education for all of Thailand’s students and maximise their potential in joining Thailand’s increasingly skilled workforce. Organizing networks of smaller rural schools, for example, can optimise the effectiveness of good teachers, bringing better teaching to all classrooms and giving a better education to all students and reduce the disparity in education results between urban and rural schools.
“Thailand has seen high growth in the past. Further improvements in competitiveness will be important for sustained economic growth and rising incomes for the Thai people,” said Ulrich Zachau. World Bank Country Director for Southeast Asia, “Helping ensure that all Thais can enjoy a high quality education and acquire strong skills for the modern economy will be the key for increasing productivity and competitiveness. Organising school networks so as to place good teachers in all class rooms throughout Thailand can make a big difference for Thai children and families, especially outside Bangkok."
"This issue of the Thailand Economic Monitor stresses the urgent need to develop our human resources, on which I cannot agree more,” said Finance Minister Sommai Phasee at the press conference. “Education is the key to improving a country's competitiveness. Countries that have given importance to this issue, such as Singapore and South Korea, have been able to rapidly transition from middle income countries to developed countries. I would therefore urge all to read this report and stimulate actions to further develop our education system."
