| By Manager Online | 25 August 2007 15:05 |
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August 24, 2007
BANGKOK (AFP) - Thailand's economy is still on track to grow by 4.0 percent this year, despite a sudden slowdown in exports in July, Finance Minister Chalongphob Sussangkarn said.
The government still expects exports to grow by 12.5 percent this year, even though July exports registered at the lowest level in 29 months, he told reporters.
"Even exports tend to slow in the second half, we are confident that the whole-year target of 12.5 percent remains achievable," Chalongphob said.
July exports grew only 5.9 percent year-on-year, against growth of 18.6 percent in the first six months.
Chalongphob insisted slowing exports were unlikely to hurt the kingdom's overall economic growth this year.
"We are confident that the decline in exports will not impact the gross domestic product (GDP) growth, which is targeted at 4.0 percent this year," he told reporters.
The Bank of Thailand also expressed confidence that the July export data did not indicate problems ahead for the economy.
"Exports slowed not only because of the strong baht, but also because of other factors, including the US economic slowdown," said BoT governor Tarisa Watanagase.
"The central bank still believes that economic growth of around 4.0 to 5.0 percent remains possible," she told reporters.
The Thai currency traded at 10-year highs in July, but weakened following a slump in the stock market and the introduction of new measures aimed at weakening the currency.
The currency finished at 34.38 baht to the dollar on Friday.
A strong baht puts pressure on exports, the key driver of the Thai economy, as it makes Thai goods less competitive abroad and cuts the value of repatriated profits.
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