RHB | Thailand | Challenges Remain But Government Has Ample Room For Manoeuvre

Economic Research	29 March 2016
Thailand
Economic Outlook
Challenges Remain But Government Has Ample Room For Manoeuvre Economic lieutenant Mr Somkid Jatuspritak continues to be pro-active in flexing his fiscal muscles, adopting a three-pronged approach of attracting FDI, pushing infrastructure investment and providing assistance to help rural citizens uplift their income. Thus far, there have been signs of success on the latter two fronts but FDI is staying away for a multitude of reasons, including reluctance of sovereign governments to deal with the military junta, and competition from CLMV countries and Singapore for low- and high-tech manufacturing investments respectively. Nevertheless, we believe that government fiscal measures will continue to prop up domestic demand ahead of what could potentially be an election year in 2017, while private investment should turn around once bidding for the more lucrative MRT projects commences in 2H. Overall, we maintain our projections for GDP to grow 3.2% in 2016. Economist:  Peck Boon Soon  | +603 9280 2163 Economist:  Ng Kee Chou | +603 9280 2179
To access our recent reports please click on the links below: 08 December 2015: Intensified Fiscal Spending To Help Head Off Another Year Of Anaemic External Demand 30 September 2015: Experienced Hand To Steer Thai Infrastructure Drive 01 July 2015: Consumer Demand Hobbles As Government Braces Balance Sheet For Massive Infrastructure Spending In FY2016 25 March 2015: Economy To Recover In 2015 With Subdued Price Pressure 27 November 2014: Growth Subdued But Outlook Expected To Improve