UTCC: Threats could cost B227bn, cut GDP growth
published : 30 Jan 2020 at 19:09
writer: Phusadee Arunmas
Widespread drought, budget disarray, toxic dust and the impact of the Wuhan virus outbreak on tourism-related spending and exports are expected to cost 226.7 billion baht in losses to the Thai economy, says the University of the Thai Chamber of Commerce.
UTCC president Thanavath Phonvichai said such losses would trim the country’s GDP growth by 1.3 percentage points in 2020.
According to Mr Thanavath, the virus outbreak is estimated to cost a combined 132.8 billion baht — 117.3 billion baht from lower tourism-related income and 15.5 billion baht from lower import demand for Thai products.
But Mr Thanavath said the forecast was made on the assumption that the coronavirus outbreak would be under control by March. The impact would be much more severe if the virus outbreak extends beyond May, he said.
Despite the gloomy outlook, the UTCC is maintaining its GDP forecast at 2.8% for the full year, anticipating improvement after March.
"Nonetheless, Thai economic growth remains at high risk to grow by less than 2.5% if these key risk factors have not been tackled," Mr Thanavath said.
On Jan 23, the UTCC flagged concerns that the economy could expand by less than 2.5% this year if the annual budget bill for fiscal 2020 hit further snags after some MPs were reported to have voted in favour of the bill without being present in the House.
If the budget bill’s implementation is postponed to May, a seven-month delay from the start of the fiscal year on Oct 1, 2019, state budget disbursement for new projects will fall further behind schedule, hamstringing the country’s sagging economy.
The validity of the 3.2-trillion-baht budget bill for fiscal 2020 is in limbo after 174 MPs requested a Constitutional Court ruling on the issue. The Constitutional Court accepted their request on Wednesday.