Siam Commercial Bank’s Economic Intelligence Centre (SCB EIC) has lowered its gross domestic product growth projection for 2013 to 4% from the previous forecast of 5.1%, the centre’s chief economist Sutthapa Amornwiwat said on Thursday.
The adjustment in the projection is due to delays in the government’s planned investment infrastructure development and water projects, decline in private investment and a fall in domestic consumption due to increasing household debts, she said.
In terms of private investment, Ms Sutthapa said imports of machinery had been particularly affected by the slowdown.
In addition, delays in the government’s 2-trillion-baht infrastructure overhaul and the 350 billion baht water and flood management projects have eroded confidence among investors, she said, while domestic consumption had dropped as household debts rose to 80% of GDP, from 63% reported in 2010.
Meanwhile, the global economic slowdown had affected the export sector, trimming the export growth over the first five months of the year to only 1.9%, she added.
However, the chief economist said exports would grow more strongly in the second half of the year because there are signs that the economies of the US and Japan are bouncing back.
China is facing its own economic slowdown, but the economy of the country is still likely to grow by as much as 7%, she added.
Ms Sutthapa projected exports would grow between 3.7% and 5% this year and between 8% and 10% in 2014.