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Source: www.asiaecon.org |

THAI UNEMPLOYMENT RATE MAY BE LOWER THAN LAST PREDICTION


Thailand's jobless rate may stabilize, showing signs the nation's economy is over the worst of its first recession in a decade and the government begins spending on projects to help spur demand and employment. The unemployment rate may achieve 2.5 percent this year, lower than last prediction (3.5 percent). Even though Thailand' GDP decreased 7 percent during the first quarter of 2009, there are signs that the economy is heading towards a positive future.


“There are some signs of improvement,” said Naris Cheyklin, chief financial officer at Central Pattana Pcl.,the nation’s largest shopping mall developer. “But we can’t be complacent. Consumption may start to come back once the economy shows clearer signs of recovery.” The March business confidence index improved slightly to 40 from 37.4 the previous month, but still is lower than half. Private investment index during the first quarter this year fell 15.7 per cent in line with imports which tumbled 38.3 per cent, especially on raw materials and capital goods as manufacturers cut production.  Although Thailand’s exports declined 25.8 per cent during the first quarter, the country enjoyed a trade surplus of US$7.8 billion as imports fell much more.  “The situation shows positive signs because of the government’s job creation scheme and also the start of a stimulus package,” Suwannee Khamman, deputy secretary-general at the board, said at a press briefing. Unemployment rose to 2.1 percent in the first quarter, compared with 1.6 percent a year earlier and job vacancies fell 23 percent. Most job cuts were by manufacturers, Suwannee said.  In the first quarter of 2009, the Thai economy was hit by deep global economic recession that had caused Thailand’s export and tourism incomes to fall sharply. The sharp drop in exports of goods and services and resultant decline in private consumption and investment, therefore, contributed to marked GDP contraction in 10 years.  Private consumption and investment spending dropped by 2.6 and 17.7 percent respectively, as compared to 2.1 percent increase and a decline of only 1.3 percent respectively in the fourth quarter of 2008.The increase in unemployment rate and the decline in export prices of key agricultural commodities together with weakening consumer confidence had decreased consumption spending.  Production sector output contracted rigorously in various sectors including manufacturing sector, construction, transportation & communication, wholesales & retails trade, and hotels & restaurants. However, financial sector continued to expand but at a slower pace in line with the slowdown in credit extension and interest rate incomes.

Source: www.asiaecon.org |


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