BANGKOK, Aug 24: Thailand’s economy should see year-on-year growth in the third quarter while weakness in the baht is not a concern and will be good for exports, the finance minister said on Saturday.
Thailand’s economy, Southeast Asia’s second largest, grew 2.8 percent in the second quarter from a year earlier. But it shrank 0.3 percent from the January-March period, when it contracted 1.7 percent, meaning the country slipped into recession..
Finance Minister Kittirat Na Ranong said in a weekly radio address that growth in July-September ‘will be driven by investment and government spending’. He did not give a specific forecast.
The central bank forecasts economic growth of 4.2 percent for 2013 and the Finance Ministry predicts 4.0-4.5 percent.
The government announced this month more measures to help revive slowing growth, though economists say the steps may have little impact unless there is also a pick-up in external demand.
Kittirat said the weak baht would bode well for exports, which are equivalent to more than 60 percent of gross domestic product each year.
‘Current baht levels are appropriate and competitive. A level of 31 or 32 is good and will help exports,’ he said.
The baht was traded around 31.85 to the dollar on Friday after hitting 32.17 on Thursday, its weakest in three years, due to capital outflows across the region.
Kittirat also said he was not worried about fund outflows because Thailand had high foreign reserves of more than $170 billion and ample baht liquidity. (AGENCIES)
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