Thailand grows 6.4% in 2012

MANILA, Philippines – Like its ASEAN neighbors the Philippines and Indonesia, Thailand bucked the global downward trend as it expanded 6.4% in 2012 due to 4th quarter numbers that exceeded estimates. 

Thailand enjoyed a record-high 18.9% growth in the 4th quarter as the industrial sector recovered from the impact of the worst flood in decades, according to the National Economic and Social Development Board (NESDB) on Monday, February 18.

Strong car sales and production — due to a government scheme that boosted new vehicle purchases — caused the economy to soar in the 4th quarter, after growing 3.6% in the 3rd quarter.  

NESDB secretary general Arkhom Termpittayapaisith attributed the growth to strong domestic and international demand that boosted the country’s performance. “There has been a full recovery after the severe floods,” he said.

Thailand grew 0.1% in 2011, when floods swamped most of the country.

Thailand’s above-6% economic growth in 2012 puts it on par with Philippine’s 6.6% performance and Indonesia 6.23%.

Flooding

The Thai economy suffered a double-digit contraction after floods from tropical storm Nock-Ten persisted for months. The disaster submerged vast swathes of the country and caused the death of more than 800 people.

The floods also caused industrial damage as floods reached 7 industrial estates and crippled production in the auto and electronics sectors — from Western Digital Corp. to Honda Motor Co.     

At its worst, the floods affected 65 of the 77 provinces in the country.

The NESDB forecasted growth of 4.5% to 5% for 2013 as it pegged export growth at 9%. 

“An economic recovery in the United States, China and Europe will be good for Thai exports,” Arkhom said, adding that a minimum wage in the country is expected to boost domestic demand. 

In January, the Thai central bank held its key interest rate at 2.75%, citing a better-than-expected economic performance. – Rappler.com and Agence France Presse