Thailand's economy to be impacted by Japan's disaster

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Thailand's economy to be impacted by Japan's disaster

Ungelesener Beitragvon KoratCat » Do Mär 24, 2011 1:50 pm

Thailand's economy to be impacted by Japan's disaster

Disaster in Japan will only have short-term and minimal effects on Thai economy and investment but in the long term, some industries such as construction and food will gain benefit, the Federation of Thai Industries (FTI) said Wednesday.

The deadly destruction in Japan after massive quake and Tsunami may affect Thailand's gross domestic products (GDP) by 0.1 percent because it has caused short of supply particularly in auto parts industry and electronics industry as well as created adverse impact on tourism sector, according to FTI.

"The country's GDP should remain at 4.5 percent as it has been expected. Japan's disaster should not cause great impact on Thai economy," said Phuwadon Suwantara, director of the FTI.

"However, the situation in Libya which has so far prompted rocketing oil price and the upcoming general election in our country are more important and must be taken into account," the director of FTI added.

Exports sector will also face brief impact, especially intermediate products and product parts including computer parts, auto parts and electronic circuits. However, food products will see minimal effect as they are indispensable products.

"There will be 11-percent growth in exports to Japan as the federation earlier projected," FTI director said.

Construction materials are among the exported products which will be advantageous soon after the Japanese government starts reconstructing its devastated country, FTI reported.

Income loss in tourism industry is expected to total 15-20 billion baht (495-661 million U.S. dollars) as the number of outbound and inbound tours will decrease significantly. This sector might see improvement as early as the end of this year, FTI said.

An estimation of 980,000 Japanese tourists come to travel in Thailand each year and this amount accounts for about 6.2 percent of foreign holidaymakers of the country.

Direct investment from Japanese investors in Thailand will diminish for a while but in the long run the country and the region will witness massive transfer of production base, mainly in automotive and auto parts industries.

The federation members, however, voiced their concerns over production base transfer from Japan for fearing Thai companies may not be able to compete with the Japanese enterprises which have more advanced technologies and more capital.

"The Thai government should implement effective measure in screening those companies which want to move their production base to Thailand in order to protect local industries," said FTI director Phuwadon.

Source: Xinhua (People's Daily Online)
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