Economist pessimistic about second half outlook
Productivity in the agricultural sector will continue to decline during the third and fourth quarters of this year due to the flooding caused by tropical storm Podul, according to Rangsit University’s Economic and Business Research Centre - Institute of Economics.
Asst Prof Anusorn Tamajai, the Centre’s director, said that agricultural productivity has already shrunk by 1.1 per cent in the second quarter and the flooding will drive up prices of crops and food during the remaining part of the year.
“The economic impact and the quality of life of the people as a result of floods and droughts are much higher than they should be and this reflects the country’s failed water management policy,” he said. “With the increasingly harsh effects of global warming, nature is warning us that we must help to better protect the environment. The government must also have serious environmental policies. Easing the environmental standards to attract foreign investment without considering the long-term impacts will turn out to be a big burden to society in the future.”
He added that measures designed to help those suffering may be hampered by the decentralized administrative structure of the country.
“The less decentralized fiscal power means that local government organizations are therefore slower to respond to the suffering of people in areas affected by natural disasters. They are less efficient and there are inadequate equipment and tools,” he added. “A public assistance budget should be allocated. Repairing roads and public buildings of the government may have to wait for the 2020 budget, which will be approved late and will be available in February next year.”
Asst Prof Anusorn noted that the Thai economy continued to face many tough internal factors.
“The impact of the trade war has become stronger, and it is beginning to affect consumer products. The US and China have raised taxes as announced on September 1, covering products worth US$187 billion (made up of US-imposed tax on $112 billion worth of goods and China’s tit-for-tat tax on $75 billion),” he said.
“There are concerns about the employment in the Thai export sector and the impact on the trade partners of Thailand that rely heavily on exports to China. As a result, these Thai trading partners including South Korea, Japan, Vietnam, Australia and Hong Kong have been ordering fewer intermediate products and raw materials from Thailand,’ he said, adding that these countries account for 25-26 per cent of Thailand’s total export value.
