Thailand's economy declines 7.1 per cent in first quarter

May 25, 2009, 7:10 GMT

   Bangkok - Thailand's gross domestic product (GDP) fell 7.1 per cent year-on-year in the first quarter of 2009, with the consumer spending index falling for the first time since the Asian financial crisis of 1997, a government think tank revealed Monday.

   The National Economic and Social Developpment Board (NESDB) predicted that GDP will fall 2.5 to 3.5 per cent for all of 2009, should the political situation 'stabilize.'

   Thailand's GDP declined 4.2 per cent in the last quarter of 2008 and 7.1 per cent in the first quarter of this year, NESDB secretary-general Ampon Kittiampon said.

   During the first three months of 2009, the consumer spending index fell 2.6 per cent, the first dip since the Asian financial crisis started in Thailand in 1997. Thailand's GDP fell about 11 per cent in 1998.

   Ampon predicted slower declines in the next three quarters of 2009, if the political scene 'stabilized' and the government could go ahead with investments in stimulus programmes.

   'If the political situation doesn't deteriorate, I would say we've bottomed out,' Ampon said.

   Thailand has been plagued by unprecendented and prolonged political instability since May 2008, when anti-government protests began in Bangkok and culminated with the closure of the capital's two international airports for ten days in November and December.

   Renewed anti-government protests, by new protestors against a new government, succeeded in forcing Prime Minister Abhisit Vejjajiva to cancel a regional summit being held in Pattaya last month, raising serious questions about the country's political future.