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Thai economic growth remains fragile as GDP expands just 2.4 per cent

Nov 18. 2019
Thai economic growth remains fragile.
Thai economic growth remains fragile.
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By The Nation

The National Economic and Social Development Council today (November 18) reported that gross domestic product expanded by 2.4 per cent, in the third quarter of 2019 compared to a rise of 2.3 per cent in the second quarter, driven mainly by increases in private and government final consumption expenditure and investment.

Exports and imports of goods, however, continued to  contracted. 

The state think-tank said that on the production side, the agricultural sector increased by 1.5 per cent in contrast to a fall of 1.3 per cent in 2019Q2 while the non-agricultural sector increased by 2.3 per cent, slowing down from a rise of 2.6 per cent in 2019Q2. The deceleration was the result of a 1.5 per cent fall in the manufacturing sector attributed to a drop of export-oriented industries and a slow-down in domestic demand. However, the services sector increased by 3.8 per cent, led by tourism, namely accommodation and food service activities; wholesale and retail trade; repair of motor vehicles and motorcycles; and transportation and storage, which grew by 6.6 per cent 5.6 per cent and 2.5 per cent, respectively. On the expenditure side, government final consumption expenditure, and gross fixed capital formation increased by 1.8 per cent and 2.8 per cent, compared to a rise of 1.1 per cent and 1.9 per cent in 2019Q2, respectively. Private final consumption expenditure grew by 4.2 per cent, following a rise of 4.6 per cent in 2019Q2. For the external sector, exports and imports of goods decreased by 0.3 per cent and 7.7 per cent, respectively. After seasonal adjustment, the Thai economy in 2019Q3 expanded by 0.1 per cent (QoQ SA).

Private final consumption expenditure grew by 4.2 per cent,in comparison to a rise of 4.6 per cent in 2019Q2, contributed largely to an expansion of durable, semi-durable and non-durable items with a rise of 1.8 per cent, 1.9 per cent and 3.4 per cent, compared to a rise of 5.7 per cent, 3.0 per cent and 4.6 per cent in 2019Q2, respectively. Service items rose 6.4 per cent, accelerating from a rise of 4.7 per cent in 2019Q2.

General government final consumption expenditure increased by 1.8 per cent, accelerated from a 1.1 per cent rise in 2019Q2. That acceleration was attributed to an expansion of compensation of employees and purchases of goods and services with a rise of 1.2 per cent and 6.7 per cent, respectively, whereas social transfer in kind dropped by 3.6 per cent .

Gross fixed capital formation grew by 2.8 per cent, accelerated from a rise of 1.9 per cent in 2019Q2. Expansion came from private investment with a rise of 2.4 per cent, compared to a rise of 2.1 per cent in 2019Q2, due mainly to a 3.1 per cent expansion of machinery items. Public investment accelerated by 3.7 per cent, compared to a rise of 1.4 per cent in 2019Q2, driven by an increase in construction and an improvement in machinery items .

Changes in inventories at current market prices in this quarter decreased with avalue of Bt12.7 billion . Gold, rice, cassava, and crude oil all saw a decline in stocks.

Goods and services balance at current market prices recorded a surplus of Bt435.1 billion , sourced by surpluses in goods and services with the value of Bt244.5 billion and Bt190.6 billion, respectively, added the NESDC.

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