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Thai economy continues to expand despite falling exports

May 2013 | Servcorp

 

The big news currently coming out of Thailand is that while exports have fallen for the first time in six months, the economy is still continuing to expand, with an annual growth of 5.3% being expected by the end of the year.

As those that had their eyes on initial projections for the year will be quick to tell you, this marks an increase on the 5% that experts felt the economy would grow by at the turn of the year.

Thailand's status as an emerging market obviously means that businesses will have had their eyes on it anyway, however the fact that it might surpass expectations with its growth rate will put even more eyes on the nation.

The fall in export rates may raise a few eyebrows, however it can be put down to domestic manufacturing slowing down in the industrial and agro-industrial markets. While this is something that Thai officials will be keen to stop happening on a regular basis, it's hardly all doom and gloom from a financial standpoint.

Tourism is continuing to enjoy a steady growth, and consumption within the public sector continues to grow based on the overall 2013 budget spending.

Inflation levels are also due to stick at around 3%. All in all, the economy is at a fairly healthy level – and that's before even considering potential extra business that could be attracted off the back of targets being surpassed.

If you've got business considerations in Thailand, or are considering setting up operations there, then at present you could do a lot worse.

However, like all markets bear in mind that there are certain risk factors standing in the way of it hitting the projected 5.3% growth rate.  

For example, recovery levels in the Eurozone will impact on overall Thai output, as will the overall levels of debt in the United States.

At present though, the Thai economy is in a pretty healthy and stable state as far as emerging markets go. All signs point to it continuing to prosper in the short to medium term at least.