Boston, MA -- (SBWIRE) -- 02/06/2014 -- Growth Forecast Reduced For 2014
Since BMI's last quarterly report we have reined in our outlook for Thailand. We now estimate 2013 GDP growth at 3.6% (reduced from 4.0%) and are forecasting 2014 growth at 3.8% (down from 4.5% earlier). Two main factors explain this adjustment. First, data for Q313 show that cooling external demand has begun to have an impact on household spending and business investment. Second, an upsurge in political tensions in November/December 2013 has again increased worries over the country's immediate future. Mass demonstrations against the 'red shirt' government of Prime Minister Yingluck Shinawatra by her 'yellow shirt' opponents eventually passed off without major violence. The Prime Minister, defeated in her attempt to pass an amnesty law and reform the Senate (steps seen as designed to prepare the return to Thailand of her controversial brother, former Prime Minister Thaksin Shinawatra) has instead called new elections for February 2014. This means that there will be a short-term pause before the country's prospects become clearer.
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BMI's outlook for the ports and shipping sector is for positive volume growth in a 3-7% range. Freight transport infrastructure investment projects and Thailand's increasing role in intra-regional trade should keep the shipping business growing a little faster than the economy as a whole.
Headline Industry Data
- Gross tonnage at Laem Chabang, the country's largest port, set to rise by 5.5% to 48.008mn tonnes in 2014 (faster than the forecast 3.8% GDP growth for the year).
- Box handling at the same port to rise 3.5%, to 6.299mn twenty-foot equivalent units (TEUs) in 2014.
- At the Port of Bangkok, BMI projects that tonnage will grow by 4.2% in 2014, to 20.234mn tonnes, with container handling set to grow by 7.0%, to 1.592mn TEUs.
- We expect the real value of foreign trade to grow by 5.0% in 2014, up from 4.4% the year before. Imports will be up by 5.4%, ahead of exports that will grow by 4.5%.
Key Industry Trends
Port Industry On Alert Over Political Tensions: In early December 2013, all national government services, which included customs and the port authority, were operating normally at ports in Thailand despite rising political tension and riots in the capital Bangkok, according to shipping and logistics firm Gulf Agency Company. However, customs clearance, transportation and other services offered by state-level agencies were likely to be affected by the protests, the firm said.
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