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Mid

Thailand’s Industrial Output Falls for Eighth Months on Exports
Suttinee Yuvejwattana

July 31 (Bloomberg) -- Thailand’s industrial production fell for an eighth month in June as the global recession slashed demand for automobiles and processed food. The magnitude of the drop was the smallest since November.

A measure of manufacturing production dropped 7.8 percent from a revised 9.8 percent decline a month earlier, Pichit Patrawimolpon, a Bank of Thailand director, said today in Bangkok. The median estimate of 15 economists in a Bloomberg survey was for a 9.5 percent contraction.

“The Thai economy has hit the bottom,” said Kosit Panpiemras, executive chairman at Bangkok Bank Pcl, the nation’s largest lender. “But it will take time for us to return to growth. Global trade remains very weak and that will hurt export-dependent economies like ours.”

Southeast Asia’s second-largest economy, in its first recession in a decade, may return to growth in the fourth quarter, the Bank of Thailand predicts, citing indications the worst of the contraction has passed. Hana Microelectronics Pcl and the local unit of Western Digital Corp. have begun rehiring workers to meet revived demand for their exports.

Thailand’s SET Index of stocks gained 0.3 percent as of the 12:30 p.m. lunch break. The baht was little changed at 34.03 per dollar.

Trade

Exports, which are equivalent to about 60 percent of Thailand’s economy, slid 26.4 percent to $12.2 billion in June from a year earlier, declining for an eighth month, the central bank said today. They sank 26.5 percent a month earlier.

Thailand’s imports fell 26.3 percent last month to $11.2 billion after a 34.3 percent drop a month earlier. The trade surplus in June was $939 million compared with a $2.34 billion excess a month earlier, the central bank said.

A measure of business sentiment was 46.3 in June from 45.4 a month earlier, the central bank said. The reading hasn’t exceeded 50, a level that suggests the mood is improving, since April 2004.

The current account-surplus narrowed to $477 million in June from $1.39 billion a month earlier. The median estimate of 11 economists in a Bloomberg News survey was for a $738 million surplus.

The current account comprises the difference between exports and imports of goods, services, investment income and remittances. Trade makes up about 70 percent of the current account, and tourism contributes most of the service industry’s 30 percent component.

Tourist arrivals dropped 18.6 percent from a year earlier to 940,000 last month, the central bank said today. The number of people visiting Thailand has fallen for 10 straight months, the longest contraction since Bloomberg began tracking arrivals in 1997.

bloomberg.com

__________________
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gjbkk

everything is in the red. must be the evil one's fault

Mid

“The Thai economy has hit the bottom,”

actually ......................

Virabongsa: Govt wrong on economy
31/07/2009

The government should not expect the economy to recover soon as there is a strong possibility that the domestic recession will worsen in the second half of this year and the first half of next year, former finance minister Virabongsa Ramangkura said on Friday.

He was speaking at a seminar, The Economy in the Second Half: Can Thailand be Strong, organised by the Creating Thai Future Institute, chaired by Khunying Sudarat Keyuraphan, a former key member of the Thai Rak Thai party.

Mr Virabongsa reasoned that the country is being hit hard by the global economic meltdown, political uncertainty and the outbreak of swine flu.

“I was frightened to see that the government dared to declare the economy would recover in the second half of the year because there is no sign of any improvement,” he said.

Exports shrank by two-digit figures and the tourism sector was in a critical situation and prices for agricultural products were declining.

Mr Virabongsa said the government gives more importance to political matters than to economic problems. If the government was confident the economy was recovering there would be no additional stimulus measures, and this would worsen the situation.

The fiscal and monetary measures being implemented were not enough to continuously shore up the economy.

It was not clear what the government would do over the next three years with the B800 billion baht it plans to raise in loans. There were no new investment projects in the government's fiscal 2009 budget and therefore the prediction for economic improvement was not sound.

What was clear was that the unemployment and inflation rate figures showed Thailand was entering a period of deflation.

The country was also entering a liquidity trap - as there was excessive liquidity but no one was investing the cash, the former finance minister said.

Mr Virabongsa is CEO of Advanced Agro and served as an economic adviser to then-prime minister Gen Prem Tinsulanonda in the 1980s. In the mid-1990s, he was finance minister during Gen Chatichai Choonhaven's administration and was deputy premier in charge of economic affairs under prime minister Chavalit Yongchaiyudh.

bangkokpost.com

StrontiumDog

Who to believe....

Certainly the global recovery is going to be very slow....

blackgang

Whats this shit about, I thought they were bragging about some Big Ships coming in and the exports were goiong thru the roof..
Maybe just more Thai thinking.

robuzo

I read an interview in this week's Bangkok Shuho, the weekly J-paper, with the vice-chairman of the Thailand Gems and Jewelry Association (at least I think that is what their name might be in English). About 1.1 million people work in the industry in Thailand, and they expect that the fall in exports will cause about a quarter of that number to lose their jobs. They are trying to use this in their bid to get the VAT on imported stones lifted- nearly all stones are imported- so gems might get cheaper here in the future, btw.

Exports to China are holding up, I think, and apparently Western Digital has been forced to bring back all laid-off employees and even hire more because demand has recovered (also in the Japanese paper). Then again, if China is a house of cards like many are saying, Thailand could be in for even more trouble.

One more thing- in the same paper, the head of the Thailand Tourist Authority says tourism is the worst he has seen it in 39 years, but they think it has bottomed. Indian and Chinese tourists are expected to pick up the slack. I think they're dreaming.

Japanese companies in Thailand are also supposedly thinking things will turn around, but it is hard to say what motivates that sentiment.

Mid

nearly all stones are imported

where from , ain't pretty

robuzo

Well, they bitch about about the 7% VAT on imported stones, too, but I wonder how many stones come in at the bottom of a suitcase, in the back of a truck from Cambodge/Burma, or up some African's bum without anyone noticing (I guess the African would notice).