Friday, May 4, 2007

The Nation: Deconstrucing Thanong, Stimulus that Doesn't Please, and Industrial Slowdown


Is the govt shirking its economic responsibility?

Thanong Khanthong

Are we going to witness an economic recovery in the fourth quarter of this year?

Earlier, on April 26, Macquarie Research dashed any hopes of a four-quarter rebound because its economic staff could not get assurances from anybody that the path toward Thai democracy would be smooth. Political uncertainties remained very high. It downgraded Thai growth to 3.5 per cent this year and predicted another one full percentage point cut of the official rate to 3 per cent


Lukewarm business response to package

Finance Reporters

The business sector is by no means as enthusiastic as the government about the Bt44-billion economic stimulus package launched by the Finance Ministry, saying that economic rejuvenation would be possible only through public and private investment.

Banthoon Lamsam, chief executive officer of Kasikornbank, said the latest stimulus package from the interim government was only part of the measures needed to support economy. Other measures were also needed to repair the gloomy economy right now, turning it into a complete package.

"The one key to encouraging Thailand's economy is real investment from both the government and the private sector," he said.

Though some perceive the Bt44-billion stimulus package as another form of populist policy as championed by the former government, Banthoon said it depended on one's point of view. However, he believes that if the private sector decided to undertake more investment, it would give a boost to the economy.

The Finance Ministry on Wednesday launched the first economic stimulus package in its term to help low-income groups and people with small businesses get access to loans.


Jobs to get scarce as industrial activity dips

Petchanet Pratruangkrai

About 700,000 new graduates face bleak prospects in finding jobs as the worst economic conditions in 10 years force many manufacturers to reduce output.

A survey by the University of the Thai Chamber of Commerce (UTCC) released yesterday shows that the industrial sector's revenue is projected to slump by 34 per cent in the second quarter this year, due to negative factors including rising oil prices, political instability and an economic downwards trend expected to trigger an unemployment problem.

The Foreign Trade Department also reported yesterday that imports of capital goods dropped by 9.2 per cent in the first quarter. This could indicate an extremely low appetite among manufacturers to increase their capacity, though Thailand's capacity utilisation is over 70 per cent - the level that requires new investment.

The situation would be hard for about 700,000 students who are expected to complete bachelor's degrees and vocational degrees and enter the labour market this year, the UTCC said. About 300,000 are completing bachelor's degrees and who are considered unskilled labour.


By the way the Thai media covers the economy, I know it can't be trusted to tell the truth. All the information is contradictory.

On one hand, you have some crying about the unemployment crisis, yet on the other hand the unemployment rate has fallen and the country is basically at full employment. Compare the numbers to Indonesia or the Philippines. I think we should be grateful rather than hysterical.

Also, the economy isn't contracting; it is just growing at a slower rate. Why should this be a shocker with all the political problems? We should be lucky that the economy isn't heading into a full-blown recession because of the clowns who are running the country now.

If I had the money to blow on stimulus, I would take the money and invest it in schools, training, and infrastructure, which are the three areas Thailand needs the most help. I'd start with replacing the 166 schools that were burned down by terrorists and spend money on new schools in Bangkok. I'd reduce class sizes across the board.

If I were to loan money out for small businesses, I would require that anybody who borrows money take an accounting and small business class first.

As you can see, I think long-term and for the best interests of the country. I could care less about lining my own pockets or blowing money on bureaucratic schemes that don't work.


Anonymous said...

The junta can't invest the money in schools, training, and infrastructure. To do so would be to take a move out of Thaksin's populist cronyist playbook. Don't forget: Thaksin and his minions have significant investments in the education and infrastructure sectors.

Thaksin = bad, military = good. Whatever Thaksin did, the military government has to do the complete opposite.

Anonymous said...

Significant investments in education by Thaksin? But many people in Bangkok still believe that Thaksin & his TRT thugs were resposible for the spate of school burnings that immediately Thaksin's ouster . . .

Anonymous said...

Thakin funded the Student Loan Fund and Income Contingency Loan programs - both of which were cancelled by the junta. The One District One Dream School program was also cancelled. Thaksin participated in the One Laptop Per Child program and initiated a plan to install PCs and broadband connections to all schools - all of these programs were cancelled by the junta.

For the record, Thaksin did order all those schools to be burnt down, just to spite the King. He also worships stillborn fetuses, prays to Satan, and plans to establish a communist paradise. At least, that's what I heard Sondhi Limthongkul claiming...

Fonzi said...

If you guys or gals are going to use anonymous names, please pick a name and add it after your comments please, so you can be distinguished from all the other anonymous people.