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Private sector sees export growth rising by up to 3.5 per cent

May 02. 2017
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By THE NATION

A PEAK grouping of private-sector financial organisations has raised its forecast for this year’s export growth to 2-3.5 per cent amid a pick-up in the global economy. But the Joint Standing Committee on Commerce, Industry and Banking (JSCCIB) warns that uncertainties over the trade policies of the United States remain a major risk.

Still, the private sector was encouraged by a more positive view emerging on US-Thai trade after US President Donald Trump phoned Prime Minister Prayut Chan-o-cha and invited him to Washington.

Predee Daochai, chairman of the Thai Bankers’ Association, said the JSCCIB at its last meeting agreed that the economy was expected to stage a recovery this year in line with the improving global economic conditions, despite the risks from an unclear US trade policy and a reduction in the US deficit.

First-quarter export growth came in higher than expected, thanks to a stronger performance, in particular, from the electronics, automobile and parts and rubber products industries, he said.

Amid easing tensions between the United States and China, the JSCCIB’s revised forecast of export expansion of 2-3.5 per cent this year follows an earlier projection of 1-3 per cent. It also cited improvements in the economies of the US and Europe.

The Thai economy is expected to grow in a range of 3.5-4 per cent this year.

Referring to Trump’s recent call to Prayut, Kalin Sarasin, the chairman for the Board of Trade of Thailand, said that this was a positive sign for US-Thai trade and was likely to result in increased trade and investment cooperation between the two countries.

As Asean has seen satisfactory economic expansion, he said the US needs to have stronger connections with the regional grouping on investment and trade, he said.

Trump’s invitation to Prayut for a White House visit reflects the US view on Thailand as the centre of Asean, Kalin said 

He said that while the US has a large trade deficit with Thailand, the country was unlikely to be subjected to trade barriers as the US is not capable of producing some of the goods it imports from Thailand. More than 40 per cent of Thai export products to the US are derived from US investment. These product types include electronics, rubber, fisheries, and jewellery and accessories.

The private sector is ready to provide information for the Thai government if trade discussions are held with the US president, Kalin said.

On the rise in the minimum wage to Bt400 within three years, Poj Aramwattananont, vice chairman of the Thai Chamber of Commerce, said the private sector is ready to support the move, |especially if it is applied against workers' skills. Now, most workers earn wages at rates higher than the minimum wage, given the general increase in workers’ skills, he said.

Last year, the government raised the minimum wage in sectors that required more specialised skills. Poj said any move to extend the rise in the minimum wage nationwide would need to take the interests of all parties into consideration, for the sake of fairness.

 

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