New central bank governor says Thai GDP to rise in Q2 next year

0 Comment(s)Print E-mail Xinhua, October 20, 2020
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BANGKOK, Oct. 20 (Xinhua) -- Thailand's new central bank governor Sethaput Suthiwartnarueput said on Tuesday that he believed the Thai economy will begin to pick up in the second quarter of next year but will take two full years to return to the pre-COVID-19 level.

The economic fallout can be solved but it will take time as there are no magic pills, Sethaput said in his first press briefing as head of the Bank of Thailand (BoT) after assuming his position on Oct. 1.

"The impact triggered by the pandemic had been severe, most notably on tourism and export," Sethaput explained, adding that the tourism sector may lose 1.6 trillion baht (51 billion U.S. dollars), or 10 percent of the GDP, with foreign arrivals expected at 6.7 million this year, compared to nearly 40 million in 2019.

He said that export value in the second quarter of 2020 was the lowest in 11 years.

"But I can see the shift in the second quarter of next year," the BoT governor said. "And then move to the pre-COVID level in the third quarter of 2022."

The COVID-19 pandemic would make economic recovery uncertain and it would take time and require efficient use of limited resources to solve economic woes, he believed.

Sethaput also said the BoT was duty-bound to ensure that monetary policy and liquidity would not hinder the economic recovery.

"Our policy rate is the lowest in this region and a record low with limited room, so other measures, including fiscal ones, will have to play a major role," he said.

The bank has cut the key interest rate three times this year to an all-time low of 0.50 percent to support the economy.

The BoT would consider more measures as appropriate but it was in no rush to introduce them and would not rule out unconventional policies, Sethaput said.

It would encourage capital outflows to help ease the strengthening of the Thai baht, he said.

The BoT head earlier forecasted that the Thai economy could shrink a record of 7.8 percent this year, with tourism badly hit by the pandemic. Enditem

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