Thailand
Thailand: Study trims growth to 3% if crude averages $150
Thai economic growth may fall to 3% this year if the Dubai crude oil price averages US$150 per barrel, according to a joint study by the government’s planning unit, the Bank of Thailand and the Fiscal Policy Office.
According to Danucha Pichayanan, secretary-general of the National Economic and Social Development Council (NESDC), in the worst-case scenario the economy would grow by only 3% this year if the Dubai crude oil price surges to $150 per barrel and inflation gallops to 7.2%.
The economy is projected to grow by 3.5% if crude prices are quoted at $100 per barrel and inflation at 5%.
The economy should grow by 3.2% if crude oil costs an average of $125 per barrel and inflation is 6.2%, said Mr Danucha.
The Dubai crude price from Jan 1-22 averaged $94.2 per barrel.
On Feb 21, the NESDC maintained its 2022 forecast for economic growth at 3.5-4.5%, expecting the government to contain the spread of the Omicron variant without any more restrictions.
Thailand’s economic growth will be supported by rising demand, the recovery of domestic tourism, ongoing growth of exports and higher public investment, said the NESDC.
Export value in US dollar terms is expected to grow by 4.9% this year, while private consumption and private investment are forecast to increase by 4.5% and 3.8%, respectively.
Public investment is projected to increase by 4.6%, with headline inflation estimated to be in the range of 1.5-2.5%, and the current account forecast to record a surplus of 1.5% of GDP.
The agency expects international arrivals to reach 5 million this year, generating 470 billion baht, up from 430,000 visitors and 150 billion baht in 2021.
The exchange rate is projected at 32 to 32.3 baht against the dollar, while crude oil is $72-82 per barrel.
Mr Danucha admitted the economy sees more pressure from the escalating conflict between Russia and Ukraine. If the war is settled in three months, sanctions against Russia are expected to take a toll for a long time on Thailand’s international trade.
Source: https://www.bangkokpost.com/business/2284846/study-trims-growth-to-3-if-crude-averages-150