NESDB reports clear rebound

The Thai economy fell by 2.8% year-on-year in the third quarter, according to data from the National Economic and Social Development Board.

The economy rose by 1.3% in the third quarter from the previous quarter, a slowdown from the 2.2% quarter-on-quarter growth in the second quarter.

But economists said the data released Monday was better than expected  and reaffirmed the economy was continuing to improve.

A 4.9% year-on-year contraction was posted in the second quarter, compared with a 7.1% decline in the first.

"[The data] shows clear signs of economic recovery. Other economic indices are also pointing to recovery,'' said NESDB secretary-general Ampon Kitti-ampon.

The NESDB revised its full-year forecast to a 3% contraction for 2009, with growth of 3% to 4% for 2010.

Mr Ampon said five factors would support the economic recovery through 2010: higher industrial capacity utilisation, falling unemployment, a rebound in tourism, increased exports and higher global commodities prices.

Capacity utilisation in September was 64.7%, compared with 54.8% reported at the height of the global recession in February. Unemployment in September stood at 1.2% or 450,000, compared with 2.4% or 878,900 in January.

The tourism sector, hit hard by both the global downturn and Thailand's political troubles earlier this year, rebounded to 48.6% hotel occupancy in September compared with 40.8% in June.

Exports meanwhile posted an 8.3% year-on-year contraction in September, compared with a 26.5% decline in May, with growth likely to resume by the year-end  thanks to higher demand and prices.

Mr Ampon said the Thai economy could post a contraction of less than 3% for the full year if fourth-quarter figures post a rise of 2.7% to 3.2% from the same period last year, a scenario that the NESDB forecast as having an "85% possibility''.

For 2010, the government's 1.43-trillion-baht Thai Khem Kaeng investment programme and continued  gains for the global economy will be the main drivers of domestic growth.