Bizkado

The Thai economy is expected to expand 3.5 per cent in 2010, a substantial improvement from a 2.7 per contraction this year, in line with the recovering global economy, Kirida Phaophichit, an economist at the World Bank’s Bangkok office, said on Wednesday.

Ms Kirada said the prime risk factor that could derail recovery was an increase in global oil prices. She projected the average oil price would increase from US$65 per barrel this year to $75 next year.

Another possible factor was the devaluation of currencies by countries wanting to strengthen export competitiveness, which could hurt Thai exports.

Domestic risk factors included political uncertainty, the slow spending of government investment budgets and the investment impasse in Rayong’s Map Ta Phut industrial estate, which affects the confidence of investors.

Pongnakorn Photchanaporn, director of the Economic Budget Division at the Ministry of Finance’s Fiscal policy Office, projected the economy would grow 3.3 per cent next year.

Mr Pongnakorn said the 2010 economy would be boosted by the government’s Thai Khem Kaeng (Strong Thailand) stimulus scheme.

He agreed oil prices were a risk factor, as the price was likely to rise next year.

He predicted the average oil price in 2010 would be between $80 and $90 per barrel.

Bangkok Post breaking news 2/12/2009