Friday, May 21, 2004
Thai PM sees 7% GDP growth despite oil prices
Reuters Bangkok, May 21
Thai Prime Minister Thaksin Shinawatra said on Friday he expected the economy to expand by around seven per cent in 2004, despite concerns over the impact of higher oil prices.
"I don't think economic growth will fall very much. It should still be around seven per cent," he told reporters.
Thaksin was speaking after the state-run economic planning agency said gross domestic product (GDP) growth could slip to as low as six per cent in 2004 if oil prices stayed above $40 per barrel for the rest of the year.
The National Economic and Social Development Board had forecast in March that the economy would grow seven to eight per cent this year, compared with 6.7 per cent growth in 2003.
The Bank of Thailand predicted in late April that the growth rate should range between 6.8 per cent and 7.8 per cent this year, while the latest median forecast among analysts polled by Reuters was for growth of seven per cent.
Thaksin said his government would continue its policy of partially subsiding higher petrol prices for Thai motorists.
Economist Rob Subbaraman of Lehman Brothers said in a research note this week that a protracted $5 per barrel increase in the price of oil would reduce Thai economic growth by 0.9 percentage points over the first year.
© HT Media Ltd. 2004.