Economy tipped to grow by up to 4%

  THE NATIONAL Economic and Social Development Board (NESDB) sees economic growth gathering steam to 3-4 per cent this year, from 3.2 per cent last year.
However, the Bank of Thailand should not raise the policy interest rate yet as the economic recovery is still nascent and heavily reliant on fiscal policy, while the public sector would bear a bigger debt burden, Porametee Vimolsiri, secretary-general of the NESDB, said yesterday.
The policy rate should be kept steady for about a year until the economy has stabilised.
Although the US central bank has signalled its intention for continued rises in its benchmark interest rate, Thailand may not follow the lead of the US economy.
The NESDB reported that gross domestic product (GDP) expanded at an annual pace of 3 per cent in the fourth quarter of last year, compared with 3.2 per cent in the third quarter, resulting in GDP for the full year gaining 3.2 per cent to $406.9 billion (Bt14.36 trillion).
GDP per capita advanced to $6,032, from $5,937 in 2015.
The push factors for the economy include the expansion of exports, acceleration of government investment, recovery in the agricultural sector with prices of farm crops, and a strong performance from the tourism sector.
The main concerns are the uncertainties over the policies of the Trump administration in the United States, the impact from the United Kingdom leaving the European Union, the prospect of political changes in Italy, the Netherlands, France and Germany, weakness in EU financial institutions, and the slowdown in China.
Positive factors this year are the government’s measures to stimulate the economy, while the export sector is returning to a growth trajectory, the support of agricultural production and rising incomes of farmers, promotion of private confidence and investment, as well as the mounting momentum in the tourism industry.
For this year, investment is forecast to grow by 5.3 per cent, driven mainly by government investment, which is expected to rise 14.4 per cent, while private investment will edge up 2.5 per cent. 
Private consumption will move up by 2.8 per cent, government consumption by 2.6 per cent, exports by 2.9 per cent and inflation by 1.2 to 2.2 per cent.
The forecast of GDP growth at 3-4 per cent does not yet reflect risks, mainly concerning the uncertainty over US President Donald Trump’s policies. 
However, Trump’s policies should have a limited effect on the Thai economy as there will be both positive and negative impacts for Thai shipments.
On the production side, the non-agricultural sector expanded by 3.1 per cent last quarter, the agricultural sector by 3.2 per cent, farming by 2.9 per cent and fisheries by 5.4 per cent.
Spending by the private sector rose 2.5 per cent last quarter, mainly due to increases of 8.1 per cent in telecommunications, 5.7 per cent in garments and 1.9 per cent in hotels and restaurants.