To: Lee who wrote (81015 ) 11/17/1998 5:09:00 PM From: Mohan Marette Respond to
<Economy Thailand> To Hell and Back?Source:Business Times,Singapore. 5.2% growth seen for Thailand in '99 Siam Commercial Bank forecast contrasts with govt's 1-1.5% projection THAILAND could stage a dramatic recovery with 5.2 per cent economic growth next year, said a major Thai commercial bank in the most upbeat assessment yet, one that far exceeds the government's forecast of one to 1.5 per cent growth for 1999. The Siam Commercial Bank Research Institute, the research arm of the bank, said the Thai economy would contract by 7.4 per cent this year, and remain in negative territory in the first quarter of next year when it would likely shrink by 3.8 per cent. But from the second quarter onwards, the economy would start growing at 1.2 per cent, with growth jumping to 9.6 per cent in the third quarter and 14.6 per cent in the fourth quarter. The bank said there would be economic recovery because the government has maintained economic stability and resolved the problems of the financial institutions through fiscal and monetary measures. As a result, the baht has stabilised at about 37 to the US dollar from an all-time low of 57 early this year. Moreover, the current account surplus has been boosted, and inflation has been contained at 9 per cent. As the government cut short-term interest rates from a high of 27 per cent early this year to about 4 per cent, liquidity has eased, and more money entered the markets. "The Siam Commercial Bank is extremely bullish. I agree with their trend of positive growth in the second half of next year. But I wouldn't be that optimistic." SG Securities sees the economy contracting by 8.3 per cent this year before recovering to grow by 1.3 per cent next year. Mr Saker sees Thailand rebounding on the back of resurgent exports and manufacturing.
