Thailand GDP Growth Slowest In A Year In Q4


Thailand’s GDP expanded 3.0 percent from a year earlier in the December quarter of 2016, compared to a 3.2 percent growth in the third quarter and in line with market expectations. It was the slowest expansion since the fourth quarter 2015, as a rebound in government spending and a faster rise in investment were unable to offset a slowdown in private consumption and exports.

In the three months to December, private consumption grew by 2.5 percent, compared to a 3.0 percent increase in the preceding quarter. The slowdown was mainly attributed to lower growth of spending on non-durable goods and a fall in spending on durable goods while spending on semidurable goods and net services expenditure increased.

Government spending rose 1.5 percent, rebounding from a 5.2 percent fall in the previous quarter, contributed by a 2.8 percent rise in social transfers in kind in form of goods and services, a 0.1 percent increase in compensation of employees, a 2.3 percent rise in purchases of goods and services and 0.8 percent growth in consumption of fixed capital. 

Gross fixed capital formation advanced by 1.8 percent, faster than a 1.0 percent growth in the September quarter. Public investment rose 8.6 percent (from 5.8 percent in the previous three months, as a result of a 6.8 percent expansion of government and a 12.3 percent rise in state enterprise investment). Private investment declined by 0.4 percent (from -0.8 percent drop, due to a 0.4 percent fall in private machine investment and a 0.5 percent decline in private construction investment).

Exports of goods and services grew by 1.1 percent, slowing from a 1.4 percent increase in the third quarter. Imports of goods and services rose 3.4 percent (from -1.1 percent in Q3).

On the production side, the non-agricultural sector expanded by 3.1 percent, slowing slightly from a 3.2 percent increase in the September quarter. Agriculture sector also grew by 3.2 percent, following a 0.9 percent rise in the previous quarter, contributed mainly by crops production, particularly, major rice, oil palm, and vegetable. Growth in non-agriculture sector eased for: hotels and restaurants (4.8 percent from 13.5 percent, due to lower number of foreign tourist); transport, storage and communication (5.1 percent from 6.5 percent) and electricity, gas and water supply (1.8 percent from 4.9 percent). Meanwhile, growth was faster for: manufacturing (2.1 percent from 1.6 percent), construction (6.1 percent from 5.2 percent); wholesale and retail trade; repair of motor (5.6 percent from 5.2 percent), financial intermediation (6.7 percent from 5.8 percent); real estate services (1.8 percent from 1.1 percent); public administration and defence (0.4 percent from -1.8 percent), health and social work (4.1 percent from 0.9 percent) and other community, social and personal service (6.7 percent from 11.4 percent). In contrast, a decline was seen for: mining and quarrying (-5.6 percent from -0.9 percent), education (-0.6 percent from -2.4 percent) and private households with employed persons (-2.4 percent from 1.6 percent). 

Considering full 2016, the economy advanced 3.2 percent, faster than an upwardly revised 2.9 percent growth in 2015, with exports growing for the first time in four years.

For 2017, the Thailand's economic planning agency (NESDB) expected Southeast Asia's second-biggest economy to grow between 3.0 to 4.0 percent, the same range as it forecast previously. Exports in the year are projected to rise 2.9 percent, compared to a 2.4 percent increase in an earlier projection. 

On a quarter-over-quarter seasonally adjusted basis, the economy grew by 0.4 percent in the fourth quarter 2016, the same pace as a downwardly revised figure in the previous three months and missing estimates of a 0.6 percent growth. The GDP remained  the weakest since the second quarter of 2015.

Thailand GDP Growth Slowest In A Year In Q4


NESDB | Rida Husna | rida@tradingeconomics.com
2/20/2017 12:56:43 PM