Korn: No impact from Dubai World crisis

Published: 27/11/2009 at 01:02 PM
Online news: Local News

The shock economic crash of Dubai's giant state-owned holding firm Dubai World is unlikely to have any impact on the Thai economy, Finance Minister Korn Chatikavanij said on Friday.

“The broken bubble economy in Dubai is an old story and it has been a long time happening. The economic crisis in Dubai is different from what happened in Asia a decade ago,” Mr Korn said.

Thailand's economy was recovering and would not be affected. All key economic indicators were positive, there was no sign of bubble economy in the property sector as land prices and real estate sales volume were at normal levels.

The prices of shares in the Stock Exchange of Thailand were up by 60 per cent from the beginning of this year He was confident the Dubai crisis would not affect other countries in the Middle East which were Thailand’s new export markets.

Dubai World, saddled with a US$59 billion debt, on Wednesday asked creditors to defer payments for six months. Its subsidiaries include Nakheel, the construction firm famous for making country-shaped islands, and DP World, owners of five port terminals in India.

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british

Discussion 6 : 28/11/2009 at 07:49 PM6
Thailand of course is far too superior race to be affected same as they said swine flu wouldnt happen in thailand, set index to be 800 by end year ha ha. thailand is free from climate change, thailand is free from corruption, etc.. etc.. etc... this country is such a joke now i am happy to never step foot in it again. I am suprised they are not blaming the problems in dubai on thaksin or are they??
Richard

Discussion 5 : 27/11/2009 at 06:56 PM5
Very good analysis by Dicussion 2. And Discussion 3 is right on the money. When ANY bubble bursts, whether it be financial, property, or commodities, and wherever that may be, US, Europe or the Middle East, there are worldwide implications. Thailand is not immune. In fact it is more at risk than most due to its dependence on exports and tourism and its obsession with a strong currency. You cannot swim against the tide forever. When it starts to go it will be severe.

This fragile global recovery will not need much to tip it upside down. In fact leading forecasters like Meredith Whitney are predicting a double dip recession as we speak. That could mean serious trouble for overstretched and overborrowed economies. UK house prices are forecast to fall further in 2010 as unemployment continues to rise. Japan is heasding for deflation. The US is spending trillions on healthcare reform and an unwinable war.

But according to Korn and the Government, the NESDB and the BOT, everything in Thailand will be fine with a +3% growth next year. Dream on guys.
mod

Discussion 4 : 27/11/2009 at 06:26 PM4
K. Korn has made the right assessment. This is not the same as the Asia crisis or last years financial meltdown. There will be a wobble in the US markets today and by Monday the scare will be over. Check out the markets on Monday and see if I am wrong.
Banker

Discussion 3 : 27/11/2009 at 03:31 PM3
The more this man talks the more ridicules he sounds, of course Thailand will be affected as will every other emerging market ...we are about to enter the second phase of the financial meltdown..lets look at the SET at close today and the massive drop next week..the pull back of $ out of Thailand will have no effect will it Korn
This gusted

Discussion 2 : 27/11/2009 at 01:51 PM2
Once gain, K. Korn provs to be the best man to be of the job. Read and shiver…

“The broken bubble economy in Dubai is an old story as it has been long time happening.”

Not so; until very recently, Dubai confirmed it would be able to meet all its obligations. Consequently, Moody’s, Standard & Poor etc. rated Dubai very highly - and, apparently severely behind the curve, suddenly reduced several bonds to junk states on Tuesday.

“The economic crisis in Dubai was different from what had happened in Asia ten years ago.” Not only did the Asian Financial Crisis start more tan twelve years ago, K. Korn cannot foresee if Dubai is just the first domino stone to fall, like Thailand in 1997.

Thailand is already experiencing the consequences of Dubai’s crisis - if it actually develops into a crisis - in a (very welcome) drop of share prices. The 60% rise over the past 11 months is nothing less than a bubble, unlike K. Korn’s denial.

Moreover, the Dubai’s crisis could very well have consequences for exchange rates, in particular the USD.

Finally, recently rescued financial institutions in countries like the UK, the US and The Netherlands, could default as a result of any new financial crisis - and their respective states, with sky high public debt, are at risk as well.

Let K. Korn sleep s’bai-s’bai and pretend that everything is OK on the Island of Thailand.

Time for a change.
Swedenfarang

Discussion 1 : 27/11/2009 at 01:49 PM1
Korn is a lucky man.
Nothing will impact in Thailands economy. If it is happening something in Vietnam or Dubai. Sounds like the Prime Minister when he says everything are normal going in Thailand now.
Even if the economy and exports are still minus.Thaksin is a man on the table every day. ISA is going on in Bangkok and Chiang Mai soon. ISA will be in the South until oktober 2010.
It is like hiding the head in the sand.
Because the Country is the Amazing Thailand.

Korn: No impact from Dubai World crisis