Inflows may lift GDP to 5%

Business News - Tuesday December 18, 2007

Inflows may lift GDP to 5%

Thailand's gross domestic product (GDP) could expand by 5% in 2008 mainly due to higher-than-expected foreign direct investment, says Industry Minister Kosit Panpiemras.

The Board of Investment has reported that the value of applications for investment privileges in the first 11 months was 662 billion baht, well above its target and from last year. Mr Kosit hopes the momentum of these new projects will help stimulate the economy next year to meet the 5% growth target.

Despite sluggishness in the industrial sector during his term, the country has continued to attract investors.

Mr Kosit said new investment projects would lessen the impact of external problems such as the US dollar's depreciation, the sub-prime crisis, and the stagnant global economy.

He added that economic growth would exceed 5% if the next government moves forward with the Southern Seaboard project to spur further expansion of the petrochemical industry, as well as the power and upstream steel industries.

Mr Kosit said the National Economic and Social Development Board is scheduled to finish the draft joint action plan for the Southern Seaboard over the next six months, with the public hearing process scheduled for completion in the next 12 months.

"If two upstream steel smelters by two Japanese steel giants, JFE Steel and Nippon Steel are be started next year, GDP projections could be revised up."

Bangkok Post