FRIDAY, March 29, 2024
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JSCCIB cuts economic growth forecast by 5 points to 3%

JSCCIB cuts economic growth forecast by 5 points to 3%

The Joint Standing Committee on Commerce, Industry and Banking (JSCCIB) forecasts this year's economic growth at 3 per cent, down from an earlier estimate of 3.5 per cent, on lower-than-expected export value on the back of the slow global economic recove

Thai exports are projected to contract by 2 per cent this year, compared with the earlier forecast of no more than 1-per-cent growth.

The JSCCIB expressed concerns over the global economic recovery, which could be affected by Greece’s prolonged debt crisis and China’s slowing economic expansion. Such factors could also affect Thai exports in the next periods.

According to the committee, which consists of the Federation of Thai Industries, the Thai Chamber of Commerce and the Thai Bankers’ Association, the Thai economy has made a gradual recovery, with growth momentum in tourism and signs of recoveries in consumption for durable goods and services.

More of the government budget has been disbursed, and state spending is on an acceleration trend.

However, private investment remains weak after declines in manufacturing and consumer confidence. Exports fell for a fifth month in May.

Greece’s rejection of its creditors’ proposals in last weekend’s democratic referendum is not expected to have much impact on Thai exports this year, as that country imports little from this country in any case, the JSCCIB said.

Thailand’s key exports to Greece include air-conditioners and automobiles, which account for 0.43 and 0.06 per cent respectively of Thai exports of each product. However, the impacts of Greek voters’ decision on the euro zone, a major export destination for the Kingdom, need to be monitored.

The baht, which remains a risky currency, is expected to depreciate against the US dollar and the euro in the short term after the Greek referendum.

The Thai stock and bond markets may face selling again, but the risk of abrupt sales is limited, as a result of adjustment of emerging-market investment on the Greek uncertainties.

Not much impact on tourism is expected as Greeks accounted for only 0.08 per cent of total foreign visitors to Thailand last year.

The JSCCIB also joined the chorus of business lobbies opposing the single nationwide minimum wage. The committee wants different minimums for each province according to their actual social and economic situations. However, the provincial rates should not go lower than the current nationwide minimum of Bt300 per day.

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