Vol. II No. 32 Saturday August 16 - August 22, 2003
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BUSINESS NEWS
HEADLINES [click on headline to view story]:

Inflation remains stable after slight increase in first 7 months

OTOP products to hit world stores within 3 years

Current account surplus in June shows economy bouncing back

Inflation remains stable after slight increase in first 7 months

The consumer price index for July remained unchanged from the previous month, putting the inflation rate for the first seven months of the year at 1.8 percent, well within the target for the year as a whole, according to new data released yesterday by the Ministry of Commerce.

Phisit Settawong, deputy permanent secretary for commerce, said that although the general consumer price index for July remained unchanged from June, it was 1.8 percent higher than July 2002. This accorded with figures for the first seven months of the year, which also showed a 1.8 percent year-on-year growth rate.

Goods which recorded a drop in price last month were fresh vegetables, including kale, snake beans, coriander, spring onions, bird’s eye chilies and limes, due to the favorable climatic conditions at the beginning of the rainy season. Also down in price were a number of fruits, namely rambutans, durians and water melons, together with soy bean oil, palm oil, soy sauce and fish sauce, personal products including shampoo and sanitary napkins, and cleaning products such as washing powder, conditioner and dish washing liquid.

However, Thai fragrant rice or ‘hom mali’, increased in price as the production season reached a close, while the price of fresh chicken also rose on the back of higher exports due to the easing of trade restrictions by the European Union. Eggs also increased in price, in part due to greater acceptance of and demand for Thai eggs in foreign markets. At the same time, the price of petrol was edged up four times, while the price of high revolution diesel was pushed up three times, before dropping once.

Phisit expressed confidence that the rate of inflation for the year as a whole would not exceed the government target of two percent.

Meanwhile the base consumer price index, based on 235 goods and services, excluding fresh food and energy, stood at 104.3 points, a 0.1 percent decrease on June figures, but 0.1 percent higher than July 2002. This put the average year-on-year increase for the first seven months of the year at 0.2 percent. (TNA)


OTOP products to hit world stores within 3 years

Deputy Prime Minister Somkid Jatusripitak has pledged to ensure that ‘One Tambon, One Product’ (OTOP) goods will be on display in large stores across the world within three years, expressing confidence that foreigners would be willing to pay top prices for products that required time and skills to make.

During a recent opening of an exhibition of OTOP products from the upper southern region in Surat Thani Province, the deputy prime minister voiced confidence that within the next couple of years, the government’s continual promotion of OTOP products would eventually pay off.

Noting that the UK store Tesco and the French hypermarket Carrefour had already agreed to distribute OTOP products abroad, Somkid said that the prize-winning OTOP products from Thailand’s 76 provinces would gain global recognition, and would help pull tourists into Thailand. “Even though the prices might be a little high, tourists will be prepared to pay, as these products require intricate skills and much time to make,” he said.

Somkid said that the government was attaching importance to the OTOP scheme in recognition of its role in boosting local incomes. Noting that over the past 10 years economic growth had been concentrated in the hands of large businesses, he said that the true roots of economic expansion were local producers.

The Surat Thani OTOP event attracted a huge number of interested viewers on its first day, with crowds flocking to see the 83 products which have passed the regional selection process, of which 10 products have been accorded five stars, the highest mark of quality. (TNA)


Current account surplus in June shows economy bouncing back

The country’s sustained economic growth during June showed a rebound which surprised analysts who had predicted a dip in revenue due to the war in Iraq and the SARS outbreak. The country recorded a deficit of $185 million in May due to SARS. However, for month of June the country’s current account surplus stood at $101 million.

The current account balance is comprised of services income, which is derived from tourism revenues. After the deadly flu-like virus was contained, tourism, which accounts for nearly 6 percent of the country’s GDP, tourist arrivals and hotel occupancies showed an increase and greatly boosted the nation’s revenue.

A spokesman for Bank of Thailand (BOT) said, “June is often a slow month for tourism. It is also a month when investment funds are repatriated in the form of dividends and other income. A recorded current account surplus of over $100million is definitely a positive sign.”

The BOT reported that the country’s industrial production slowed in June due to the temporary shutdown of some tobacco, wire rod and upstream petrochemical companies for maintenance. But the manufacturing production index (MPI) rose 11.1 percent, slightly below the 13.2 percent growth it had in May.

In June, import growth slowed to 9.7 percent year-on-year. Exports jumped 15 percent year-on- year for the month, and the trade surplus rose to $696 million from $601 million in May. (TNA)



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