Thai Recession Quagmire? Exports dip again, but investment up 28% to US$20 billion

Stages of Economic Growth with savings and inv...

Stages of Economic Growth with savings and investment (Photo credit: Wikipedia)

Thai exports unexpectedly fell in July for the third month in a row, raising concern that lingering weak global demand will make it harder for the country to escape recession. Equally unexpectedly, Thailand investment promotion unit, BOI, said for the first 7 months of this year, investors seek investment promotion, for investment totaling about US$20 billion, up about 28%. The Commerce Ministry reported on Monday that exports declined 1.48% in July from a year earlier while imports rose 1.08%. July was the second straight month for which a Reuters poll of economists had forecast an annual increase of exports, but they fell instead. The poll had projected an 0.8% increase in July. For June, the poll forecast a 1.5% gain, but exports dropped 3.4% from a year earlier. Exports are pivotal for Thailand, accounting for about 60% of its economy. In the first seven months of 2013, exports rose just 0.6% from a year earlier. “While we still expect exports to improve, the weak July data is not a good sign for export growth this year, which could be lower than 3%. It will have quite an impact on economic growth,” said Pimonwan Mahujchariyawong, an economist at Kasikorn Research Center. Thailand slipped into a mild recession in the first half of the year, as the economy shrank on a quarterly basis in each of the first two quarters. However, the national planning agency said on Monday the economy is expected to grow in the third quarter on both a yearly and quarterly basis. South-East Asia’s second largest economy grew 2.8% in the second quarter year-on-year. But it shrank 0.3% from the January-March period, when it contracted 1.7%. (Source)

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