Source - Business Day (Eng)
May 08, 2006


Soaring oil prices and political uncertainty are expected to slow
Thailand’s economic growth to around 4-4.5 per cent this year, reducing it
to rank sixth among members of the Association of Southeast Asian Nations
(Asean) in terms of growth, says Kasikorn Research Center (KResearch). The
KResearch, a subsidiary of Kasikorn Bank, said Vietnam, which has abundant
crude oil and is little affected by the increase in global crude oil prices,
will see its economy grow to some 7.6-8 per cent this year, making it the
country enjoying the highest growth in Asean and second in Asia after China
which is projected to see its economy expand to 9.5 per cent. Asean members
during this year are projected to enjoy an average economic growth of
between 4-5.5 per cent while Thailand’s growth is expected to perform more
sluggishly, at around 4-4.5 per cent, slightly below the average, putting it
in last place among the leading countries of Asean, the think tank said. The
KResearch also pointed out that Vietnam has recently also become as one of
competitors of Thailand in some significant sectors. While Vietnam and
Thailand share an almost identical economic profile--in which trade, tourism
and investment are the major driving forces, exports by Vietnam during the
past decade grew more than four-fold to 32.23 billion US dollars last year
from only 7.26 billion dollars in 1996. Thailand’s exports during the same
period almost doubled to 110.88 billion US dollars last year from 55.94
billion dollars in 1996. The Center noted that Vietnamese exports will
surpass Thailand’s in the next 14 years if Hanoi maintains its export growth
at 20 per cent annually and Thailand’s exports grow on average of 10 per
cent annually. Since foreign investors in the two countries are mainly from
Taiwan, Japan, South Korea, Singapore, Hong Kong, Malaysia, Canada, the US
and China, the KResearch said, if Thailand’s investment atmosphere becomes
gloomy, especially due to political turmoil, foreign investors may shift
their investment to neighbouring countries, particularly to Vietnam where
the political situation is rather calm. On the tourism side, the center
said, foreign tourist arrivals to Vietnam during last year rose
approximately 18.4 percent to about 3.47 million, equal to one-third of the
foreign arrivals to Thailand during the same period. However, it said,
Vietnam’s tourism has been growing steadily over the last few years, without
any effect from the tsunami in 2004. Moreover, Vietnames authorities have
set a target of attracting about 3.6-3.8 million foreign tourists to Vietnam
this year, which has been promoted as the “Vietnam Tourism Year”. (TNA
contributed to this report) End.

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