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Economic Review of the First Six Months of 2014 in Thailand

July 25, 2014 | SERVCORP

During the first quarter of 2014, investors shied away from investing in Thailand, resulting in a decline of sorts. However, the Thai economy remains hardy, resilient, and stubborn. As such, the Bank of Thailand quite recently revealed that the Thai economy has recovered from its first quarter woes. Therefore, during the first six months of 2014, Thailand had a bit of a debacle in terms of economic growth, and it's only recently that it has shown signs of recovery and a steady rise from the decreases earlier on in 2014. Business confidence in Thailand is also improving. However, despite the slight Thai recovery, exports will likely miss its mark and end up in a financial standstill. 

The storm has passed and the situation has stabilized somewhat as far as Thailand is concerned. Currently, Thai confidence in its leaders is being restored. After six months of economic slowdown, the stock exchange is on the rise once more. In addition, the Thai baht is appreciating. The best news to come out of the country is that domestic investment is currently enjoying an all-time high. More to the point, investors and the populace alike have realized that now is the time for recovery rather than strife. The investors are daring to trust Thailand again with their investments, and it's paying dividends. 

What's more, several longstanding problems are being solved for the first time by the present government, like farmers who were left penniless by rice-pledging finally acquiring payment and getting back on their feet. Tourists who were initially wary of Thailand have started to come back too, although the initial six months of uncertainty remains fresh in the world's minds, so some might not visit still despite the signs of recovery.Presumably, since the exporter association has admitted that the nation's exportation industry might not reach the growth target in 2014, the first, most immediate priority of Thailand's present leaders is to do something about exports. 

What's Next for Thailand's Economy? 

The well-oiled machine that was the Thai economy in 2013 could finally reemerge in the second quarter of 2014. Thailand also saw quite the economic setback during the Thai flood disaster of 2012 as well, so it's used to bouncing back after growth decreases. If anything, the country is a true survivor. The exports of Thailand might be further impacted by Thailand's exist from European Union trade. The EU decided to curtail trade cooperation and visits in Thailand in an embargo of sorts. Thailand will exit the EU Generalized System of Preference Scheme by 2014's end so exporters are now calling government support. 

In particular, they wish to find possible solutions to cover for this deficit of sorts. Regardless, there's been a 1 percent to 1.1 percent increase from the first quarter drop of 0.6 percent, so a complete Thai recovery is in the horizon since Prime Minister Yingluck Shinawatra's reign. Furthermore, even though there are fears in regards to Thai exportation prices, the exportation rate nevertheless rose 7.2 percent from a year earlier in June, according to a July 18 report by junta leader Prayuth Chan-Ocha. The baht also rose about 0.4 percent to boot. Long story short, since the economic slowdown, there should be a steady Thai recovery in the months to come. 

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