Thai exports and output flag amid global gloom
Thai exports and output flag amid global gloom
Kittiphong Thaicharoen
Reuters
Bangkok
Thailand's flagging economy suffered fresh pain in September
with exports and manufacturing output faltering due to a global
slowdown and the hijack attacks in the United States, central
bank data showed on Wednesday.
The Bank of Thailand said in a statement the weak economic
data was "aggravated by terrorism and sabotage in the U.S. which
directly affected the economy and public sentiment".
Thailand's manufacturing production index fell 1.8 percent
year-on-year, only its second fall this year. The drop in
production was in line with expectations and partly due to the
fact the index was unusually high last September, analysts said.
Monthly trade slumped, with exports down 11.5 percent year-on-
year and imports sinking 6.8 percent. Many analysts had expected
the drop in exports to be even sharper, however, and markets
showed little reaction to the data.
Analysts said there was more pain to come for the economy.
"Given the September 11 attacks on the United States, we all
knew that it's going to affect our exports and most economists or
analysts also expect monthly numbers for at least the next three
to four months will be on a downward trend," said Marc Lavoie,
head of research at Asset Plus Securities.
Analysts said the drop in imports was a worrying sign as it
signaled a drop in output in coming months.
"I'm worried about the import figure because this signals
producers may be reducing their orders, and production will
decline," said Isara Ordeedolchest, economist at TISCO
Securities.
"For the rest of the year we should see a weakening in
international trade and bad signals for production."
Thailand's recovery has lost momentum this year as the global
economic environment worsens, battering exports which have been
the country's main engine of growth.
The authorities have repeatedly cut their growth forecasts for
this year and next. In the latest revision, the central bank on
Monday cut its 2001 forecast to 1.3-1.8 percent from 1.5-2.0
percent and its 2002 forecast to 1-3 percent from 4-6 percent.
A Reuters poll in early October showed analysts expected 2001
Thai GDP growth of 1.35 percent, rising to 2.37 percent in 2002.
The economy grew 4.4 percent in 2000.
The September current account was $367 in surplus, which
analysts said was encouraging.
"That's the little bit of good news in the bad news -- even
though things are slowing, at least they can maintain a current
account surplus," Lavoie said.
But the balance of payments dropped to a $236 million deficit
in September from a $350 million surplus in August.