Economist:Thai economy will recover from 2nd quarter

BANGKOK, May 3 (TNA) - A senior Thai economist has forecast that the Thai economy should grow by 6-6.5 per cent on average in 2012, with its steady recovery to be obviously seen from the second quarter of this year. The prominent Thai economist, Virabongsa Ramangkura, who is a former Thai deputy prime minister and now chairman of the government's Strategic Committee for Reconstruction and Future Development, said on Wednesday that the Thai economy in 2012 should significantly recover from the second quarter until the end of the year with the country's gross domestic product (GDP) to expand by 6-6.5 on average due to the rebounding post-flood local industrial sector. Virabongsa, who is also a former Thai finance minister, referred to an unexpectedly huge collection of the country's value-added tax or VAT over the past months and the government's spending of up to some 120 billion baht on post-flood rehabilitation and another 350 billion baht officially designated for flood prevention projects which will be soon injected into the national economy. Virabongsa pointed out that inflation concerns have been relieved, seen by a drop in the country's food price index, starting from February 2012, resulting in moderate increments in goods prices on the domestic market and indicating Thailand's inflation to be probably slow down in the future. On the other hand, the senior economist acknowledged, applications of investment projects seeking promotional privileges from the Board of Investment of Thailand (BOI) have been increasing, clearly reflecting the recovering investment in the local private sector. The former deputy premier cautioned, however, that Thailand's noticeable economic recovery in the second half of this year will likely cause labor shortage, as neighbouring Myanmar is opening itself and its economy is expanding, observed by the value of kyat, Myanmar's currency, which has appreciated from 100 kyat against four baht to 100 kyat against 5.5 baht; therefore, Myanmar workers are likely to return to their homeland amid higher demand for foreign workers in southern Thailand, for instance, for latex tapping and fishing, leading to higher wages in the Thai economy. (TNA)