KRC:Thailand's GDP will grow by 5% in 2012

BANGKOK, March 22 (TNA) - The Kasikorn Research Center (KRC) has maintained its projection that Thailand's gross domestic product (GDP) should grow by 5 per cent and exports by 7-15 per cent this year, while inflation should stand around 3.5-4.5 per cent, unless there was any extreme factor which would cause a surge in world oil prices to over 130 US dollar a barrel for a long period. KRC Vice President Pimolwan Mahajchariyawong assessed Thursday that the post-flood Thai economy would improve in the second half of this year, but remaining risk factors would be rising oil prices, people's costs of living and daily minimum wages to 300 baht from early next month. Pimolwan, therefore, warned that inflation could also soar in the second half of this year due to the risk factors, saying unless domestic energy prices were frozen, Thailand's inflation could even rise to 5.6 per cent, but if the government capped the domestic energy prices, the country's inflation would be lower at 3.9 per cent on the condition that the Dubai crude oil price remains at around 118 US dollars a barrel. Pimolwan pointed out that another major risk factor of the Thai economy appears to be the persisting European debt problem, acknowledging if the debt crisis in Europe worsened, the European markets of Thai exports would be affected and the growth rate of the Thai economy would be limited at only 1.8%. According to the KRC vice president, if there was any oil price crisis in 2012 with world oil prices soaring to 195 US dollars per barrel on average, inflation would surge sharply worldwide and the global economy would experience stagflation; while Thailand's GDP would shrink by 5.5 per cent but inflation would jump by 8 per cent. The KRC vice president foresaw, however, that the possibility of the feared world oil crisis is low, given that there will be a new presidential election in the United States in the coming months and Washington is believed not to desire any war for the time being. (TNA)