BANGKOK – Thailand’s economic growth rate in the second quarter of this year made its slowest pace in nearly five years. The National Economic and Social Development Council is blaming it on the China-United States trade war.
NESDC secretary-general Thosaporn Sirisumphand announced the figure as the council revised downward. Its projection for the growth rate of the gross domestic product for this year from 3.6% to 3%.
According to him, the growth rate in the second quarter was the lowest since the last quarter of 2014. As the rate in the first quarter this year stood at 2.8%, the growth for the first half of 2019 was at 2.6%.
Exports dropped by 4.2% in the second quarter of this year as the China-US trade war slowed down the global economic growth rate to 3.2%. Other factors were drought, low farm prices, the weaker purchasing power of consumers and the slow growth of tourism-related income on the weak increase in tourist arrivals.
NESDC predicted exports would shrink by 1.2% this year instead of its earlier forecast of 2.2% growth.
The council believes the economy would pick up in the second half of this year on the government’s immediate economic stimulus measures, quick disbursement of government budgets, and investments in the government and private sectors.
If the economy expands by 3.4% in the second half of this year. The growth rate throughout 2019 can reach 3%, Mr Thosaporn said.
Finance Minister Confident of Economic Growth This Year
Meanwhile, Thailand’s Finance Minister Uttama Savanayana said the economy could grow by 3% this year and he would propose 316-billion-baht economic stimulus.
The minister said that the economic growth of 2.3% in the second quarter of this year been expected.
The figure was not lower than the government’s anticipation because of the trade war of China and the United States.
“This is why the government must issue urgent measures to maintain the Thai economic growth,” he said.
The Finance Ministry will tomorrow table a 316-billion-baht economic stimulus package in the cabinet meeting. It includes cost-of-living subsidies and incentives to encourage consumption and domestic investments.
If the cabinet approves the whole package, it will boost the gross domestic product and the GDP should grow.
The stimulus measures could take effect either late this month or early next month, he said.