Where Did Thailand's GDP Grow in Q1/2018? According to the GDP data for the first quarter of 2018 released by the National Economic and Social Development Board (NESDB), it shows a growth of 4.8%. In terms of production, the agricultural sector grew by 6.5%, while the non-agricultural sector expanded by 4.7%. TerraBKK summarizes this positive information with “Economic Indicators”. Let's take a look at which sectors of the Thai economy grew the most in the first quarter of 2018. Here are the details:

              The hotel and restaurant sector grew by 12.8% and can be considered the most outstanding business sector in the first quarter of this year. The number of tourists increased by 15.4%, mainly from Hong Kong, China, Russia, and India. Overall, revenue from tourists rose by 16.8% (foreign tourists increased by 19%, while Thai tourists increased by 12.2%). The average occupancy rate was 76.79%, showing an increase both Q0Q and Y0Y.

 

              Exports (value of goods exported in USD) grew by 9.9% with export volume increasing by 5% and export prices rising by 4.7%. The top three products with the highest export growth were petroleum products at 41.1%, telecommunications equipment at 37.7%, and cassava at 28.7%. Conversely, the product with the largest decline in export value was rubber, which decreased by 34.8%.

             The transportation and logistics sector grew by 7.1%, with the highest growth in air transport, which increased by 12.5%. The number of low-cost international flights rose by 25.9%. Water transport expanded by 9.5%, while land transport grew by 3.4%.

             The retail and wholesale sector grew by 7%, with the “Retail Index” increasing by 5.7%. Examples of product categories that saw growth include department stores and shops, which expanded in line with household spending, exports, and the number of foreign tourists.

             The agricultural sector grew by 6.5%, with increased production in products such as animal feed corn, paddy rice, rubber, palm oil, sugarcane, fruits, white shrimp, pork, and chicken. The “Agricultural Price Index” showed the highest prices for paddy rice, cassava, and animal feed corn, while prices for rubber, palm oil, and sugarcane decreased. Overall, the “Farmers' Income Index” fell by 4.8%.

             The industrial sector grew by 3.7% , with the highest growth in vegetable and animal oils at 38.8%, followed by petroleum products at 20.6%, automobiles at 12%, computers/accessories at 10.2%, and plastics/rubber at 8.7%. Meanwhile, industries that contracted included tobacco products, distilling and mixing spirits, and other rubber products.

             Private consumption grew by 3.6%, expanding across all product categories, including spending on services and semi-durable goods, durable goods, and non-durable goods. Although sales of passenger cars slowed down compared to the previous quarter, consumer confidence regarding the overall economic situation remained at 66.7, the highest in the past 12 quarters.

             Total investment grew by 3.4% , showing improvement in both public investment (up 4%) and private investment (up 3.1%), particularly in machinery and construction. The value of investment promotion applications increased by 203 billion baht, higher than the previous quarter.

             Production in the electricity, gas, and water supply sectors grew by 2.2% due to a 3.3% increase in electricity production and sales, while production in other areas such as gas and water supply decreased by 4.7% and 1.8%, respectively.

             Public spending grew by 1.9%, showing a slight increase from the previous period. The labor compensation category increased by 2.1%, the depreciation of fixed assets increased by 2.7%, non-cash social welfare transfers increased by 1.3%, and spending on goods and services increased by 4.9%.

             The construction sector grew by 1.2%, with private construction increasing for the first time in three quarters, in line with the expansion of construction permit areas. Residential construction grew by 4.1%, and hotel construction expanded by 3.4%. However, public construction contracted by 0.1% due to a 5.4% decrease in public construction. The “Construction Material Price Index” increased by 2.8%, reflecting the prices of concrete, cement, wood, and steel.

            In conclusion, TerraBKK believes that we need to continue monitoring economic figures to see how the remaining quarters of 2018 will unfold. If the situation remains stable without any unusual events, Thai people can expect to see GDP growth within the range of 4.2-4.7, as predicted by the National Economic and Social Development Board (NESDB). ---TerraBKK

Article by: TerraBKK Investment Tips
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