The economy continued to expand in April, driven by the service sector while exports and private investment remained sluggish, according to the Bank of Thailand.
Senior director Roong Mallikamas said the number of tourists rose 9.8% but the manufacturing sector expanded more slowly, with capacity utilisation standing at 64.8%, down from the previous month and in line with lacklustre exports.
Thai shipments contracted 7.6% from the previous month to $15.5 billion in April, compared to a 1% contraction in March, she said.
“Excluding gold, the contraction would be 7.9% due to the slow recovery of our major trading partners, China and Asean,” she said.
At home, drought put pressure on domestic consumption, causing households to spend more cautiously. Private consumption shrank 0.2% month-on-moth, resulting in flat private investment growth.
Government spending slowed down after accelerating in March but still met the target.
“Investment was not high and limited only to telecommunication and alternative energy. It’s the signal that we hope would improve.
“It’s understandable why private investment was low, why investors waited. Capacity utilisation remained low so there was no need to expand and there was no indication that markets overseas would pick up quickly,” she said.
Investment was too low and has always been for decades, she added.
“We hope economic growth in the next quarter would continue at this level, bringing all-year growth close to our 3.1% base projection, given that drought has eased and rain has begun, Mrs Roong said.
According to the National Economic and Social Development Board data, the economy grew 3.2% in the first quarter, the highest level in three years. It projected growth would be in a range between 3% and 3.5% for 2016. ed to expand in April, driven by the service sector while exports remained sluggish, according to the Bank of Thailand.