CTE Monthly Brief November 2015

About This ReportThis report is designed to chart out the economic outlook of Thailand on a monthly basis. It is ideal for corporate management, investors as well as anyone interested in the second largest economy in ASEAN.

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DISCLAIMER All Rights Reserved. No part of this publication may be reproduced without the prior permission of the publisher, ChartingTHAILAND™. The facts of this report are believed to be correct at the time of publication but cannot be guaranteed. Please note that the findings, conclusions and recommendations that ChartingTHAILAND™ delivers will be based on information gathered in good faith from both primary and secondary sources, whose accuracy we are not always in a position to guarantee. As such ChartingTHAILAND™ can accept no liability whatever for actions taken based on any information that may subsequently prove to be incorrect.

ASK THE EDITORChartingTHAILAND™ team consists of editors, analysts, and researchers. For any questions and comments about this report, you can contact the chief editor directly at [email protected].

Charting Thailand’s Economy Monthly Brief, November 2015Publication Date: November 3rd, 2015Number of pages: 72

Copyright © ChartingTHAILAND™. All rights reserved.© ChartingTHAILAND™www.ChartingThailand.com

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Reading This ReportThis report is designed to be read like a corporate presentation. Readers can easily follow the content point by point with detailed charts for each point. Explanation is provided on the right side bar of each page.

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• Thailand GDP grew only 2.8% in 2Q15, a rather slow pace compared to last quarter• Tourism was by far the main driver of growth on the expenditure side• Service was the main driver, while agriculture and manufacturing were the main

drags• Manufacturing production continues to lag behind last year’s level• Private consumption and Private Investment recovered• Import declined faster than Export. Tourism was clearly affected by the Bangkok bomb.• Unemployment rate decreased and stayed below 1% in September• Policy interest rate remains on the downward trend to boost growth• Businesses, Industries as well as Consumers were less pessimistic in September• Consensus growth forecast is now 2.7‐3.4% for 2015 and 3.7‐4.0% for 2016.

• Headline CPI suggests deflation but it was heavily skewed by energy price. CPI for most products actually increased over the past 12 months.

• Bank’s loan is still growing, although slowly, and liquidity is slightly squeezed. Bank’s capital ratio remained high. NPL continues to increase.

• Budget deficit worsened in the first 9 months. Public debt also increased but not too worrying yet.

• Positive Balance of Payment so far in 2015, thanks to trade surplus. External debt has been decreasing. THB was stable in October.

CONTENT SUMMARY

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Real GDP growthThis chart gives the long-term perspective of the historical GDP growth of Thailand. It also gives the latest annual growth during the last four quarters. It shows the real growth, which already excludes the effect from inflation. GDP calculations are prepared by Office of The National Economic and Social Development Board and released quarterly.

Historical growth for the Thai economyThe cumulative annual growth rate between 2003-2014 was 3.4%. During the last 10 years, only one year (2009) that registered a negative growth. Growth in 2010 and 2012 were exceptionally high, representing the V-shape recovery from the global sub-prime debt and the country’s flood crisis respectively. Thailand GDP grew only 2.8% in 2Q15.

Slower pace of growth in 2Q15

Chart 1.05 – Historical Real GDP growth rateAnnual growth, percent

Source: NESDB; ChartingTHAILAND analysis

7.2%

6.3%

4.2%

5.0%5.4%

1.7%

-0.7%

7.5%

0.8%

7.3%

2.8%

0.9% 0.9% 1.0%

2.1%

3.0%2.8%

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2Q14 3Q14 4Q14 1Q15 2Q15

Note: (*) Cumulative Annual Growth Rate 6© ChartingTHAILAND™www.ChartingThailand.comCopyright © ChartingTHAILAND™. All rights reserved.

Last 5 Quarters

Source of Growth – Production sideChart A shows the real growth rate of value added from each production sector. Chart B shows each sector’s contribution to the overall GDP growth. The contribution from each sector must add up to the overall growth. GDP calculations are prepared by Office of The National Economic and Social Development Board and released quarterly.

Most contributing sectors for the Thai economy in 2Q15Chart A says that Hotel & Restaurant have grown most from 2Q14 to 2Q15, while Agriculture dropped the most. Chart B looks at the contributions to total growth from all sectors. Most sectors contributed positively to 2Q15 growth, except Agriculture, Manufacturing and Mining.

Service was the main driver in 2Q15, while agriculture and manufacturing were the main drags on the economy

Chart 1.06a – Real growth by sector, 2Q15Year‐on‐Year percentage change


18.7

17.3

8.6

8.6

6.3

5.5

5.5

3.7

2.8

2.7

2.5

2.2

1.3

-0.7

-1.6

-3.9

-6.3

Hotel&Res

Construction

Financial

Transport

Other social

Health&Social

Private HH

Trading

GDP

Utilities

RealEstate

Education

PublicAdmin

Manufacture

Fishing

Mining

Agriculture

Chart 1.06b – Sectoral contributions, 2Q15Contributions to total Real GDP growth

2.8

0.8

0.8

0.6

0.5

0.5

0.2

0.1

0.1

0.1

0.1

0.1

0.0

0.0

-0.1

-0.2

-0.3

-0.5

GDP

Transport

Hotel&Res

Financial

Trading

Construction

RealEstate

Other social

Utilities

Health&Social

Education

PublicAdmin

Private HH

Fishing

Mining

Manufacture

Agriculture

Stat diff7© ChartingTHAILAND™

www.ChartingThailand.comCopyright © ChartingTHAILAND™. All rights reserved.

Source of Growth – Expenditure sideChart A shows the real growth rate of each expenditure. Chart B shows each expenditure’s contribution to the overall GDP growth. The contribution from each sector must add up to the overall GDP growth. GDP calculations are prepared by Office of The National Economic and Social Development Board and released quarterly.

Growth drivers for the Thai economy in 2Q15Chart A shows that Tourism (X of services) grew the most in 2Q15. Chart B shows that it also contributed the most to the overall growth in 2Q15. Decreasing in export of goods was the main drag on the overall growth.

Tourism was by far the main driver of growth in 2Q15

Chart 1.08a – Real growth by expenditure, 2Q15Year‐on‐Year percentage change

25.1

4.6

2.8

2.5

1.9

1.5

-0.2

-0.3

-4.0

X (services)

G

GDP

I (capital)

I

C

M (services)

M (goods)

X (goods)

Chart 1.08b – Expenditure Contributions, 2Q15Contributions to total Real GDP growth

2.8

3.3

3.0

0.8

0.8

0.6

0.1

0.0

-0.2

-2.5

GDP

X (services)

Discrpncy

C

G

I (capital)

M (goods)

M (services)

I (Inventory)

X (goods)


Note: (*) C = Private consumption, I = Investment which includes I (capital) = Capital formation and I (inventory) = Change in inventory G = Government consumption, X = Export of goods and services, M = Import of goods and services 8© ChartingTHAILAND™


MPI Beyond TrainingBusiness Simulation and Experiential LearningContact Us:Tel: 02‐168‐7245‐7, 098‐248‐2585www.BeyondTraining.co.thFacebook: MPI Beyond [email protected]


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CONTENT SUMMARY

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Manufacturing Production Index (MPI)Manufacturing Production Index is a composite index calculated by the Office of Industrial Economics, Ministry of Industry. The composite includes all industries and weighted by their value added. The year 2000 is used as the base year and the figure is released monthly.

Latest developmentManufacturing production decreased 3.6% year-on-year in September 2015, continuing to lag behind last year’s level.

Manufacturing production continues to lag behind last year’s level

Chart 1.10 – Manufacturing Production Index (2000=100)

Source: The Office of Industrial Economics

152.1161.1

174.6182.9

170.0

194.2

177.6 181.6 175.7167.7

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Monthly Average

11© ChartingTHAILAND™www.ChartingThailand.com

0.0

20.0

40.0

60.0

80.0

100.0

120.0

140.0

160.0

180.0

200.0

J F M A M J J A S O N D

2014

2015

Copyright © ChartingTHAILAND™. All rights reserved.

MPI by sectorsChart A shows the year-on-year change in Manufacturing Production Index (MPI) by sector, that is comparing the MPI for the latest month with the MPI for the same month of the previous year. Chart B shows the month-on-month change in MPI by sector, that is comparing the MPI for the latest month with the MPI for the previous month.

Latest developmentMost sectors had their production decreased from a year ago but most managed to produce more from last month.

Most sectors had their production decreased from a year ago but most managed to produce more from last month

Chart 1.11a – Y‐on‐Y change in MPI by sectorSeptember 2015, percent

Source: The Office of Industrial Economics; ChartingTHAILAND analysis

10.68.3

5.21.9

0.50.40.3

-1.1-1.2-1.7

-3.7-4.6

-5.5-7.3-7.9-8.1-8.4

-10.7-11.7

-18.2-21.4

PetroleumTobaccoVehicles

MachineriesTransport EquipMetal products

PaperPrecision instru

ChemicalFurniture

Rubber&PlasticFood & Bev

MineralTextiles

Wood productsElectrical

Office automateElectronicLeather

Basic MatApparel

Chart 1.11b – M‐on‐M change in MPI by sectorSeptember 2015, percent

15.511.811.5

10.59.99.5

7.46.76.56.2

1.80.8

-1.5-1.6-1.8-1.9-2.3

-3.4-4.7

-6.2-12.8

TobaccoTransport Equip

MachineriesElectronic

Office automateMetal products

VehiclesFurniture

Precision instruWood products

TextilesLeather

Rubber&PlasticElectricalBasic MatMineral

Food & BevPetroleum

PaperChemicalApparel

12© ChartingTHAILAND™www.ChartingThailand.comCopyright © ChartingTHAILAND™. All rights reserved.

Capacity Utilization rateCapacity utilization rate is a composite index of the capacity utilization rate of all major industries. The index is prepared by the Office of Industrial Economics, Ministry of Industry and released monthly. Chart A shows the composite Capacity Utilization rate in the last 6 months. Chart B shows the Capacity Utilization rate of the last month by industries.

Latest developmentSeasonally adjusted Capacity utilization rate has decreased to 58.3% in September. Rubber and Plastic has the highest utilization rate at 89% while Tobacco has the lowest at 30%.

Lower capacity utilization rate (seasonally adjusted) in September

Source: The Office of Industrial Economics

Chart 1.12a – Overall Capacity Utilization RatePercent

Chart 1.12b – Capacity utilization rate by sectorSeptember 2015, percent

89%84%

81%80%

76%71%

68%66%66%

60%59%59%

51%50%

47%43%

41%40%39%

30%30%

Rubber&PlasticTextiles

Wood productsElectronicElectricalFurniture

Metal productsBasic MatLeather

Office automateFood & Bev

Precision instruMineral

ChemicalTransport Equip

VehiclesPaper

MachineriesPetroleum

ApparelTobacco


50%

52%

54%

56%

58%

60%

62%

64%

66%

68%

70%

Apr-15 May-15 Jun-15 Jul-15 Aug-15 Sep-15

Normal

Seasonally adjusted


Change in MPI in the worldYear-on-year change in Manufacturing Production Index from the latest period across major economies. The chart shows the current state of manufacturing production in the world. The figures are compiled by The Economist magazine.

Latest development7 out of 18 major economies had negative MPI growth during the last period reported. Thailand’s negative growth of -3.6% was the forth lowest on the list.

Thailand’s latest MPI change was among the lowest on the list

Chart 1.13 – Manufacturing Production IndexLatest, percent change on year ago

Source: The Economist

8.8

6.4

5.7

4.8

4.4

3.7

3.0

2.4

1.2

0.9

0.4

-0.9

-1.2

-3.5

-3.6

-4.8

-5.3

-8.9

Vietnam ‐ Oct

India ‐ Aug

China ‐ Sep

Pakistan ‐ Aug

Indonesia ‐ Aug

Philippines ‐ Aug

Malaysia ‐ Aug

South Korea ‐ Sep

Australia ‐ Q2

Euro Area ‐ Aug

US ‐ Sep

Japan ‐ Sep

Hong Kong ‐ Q2

Russia ‐ Sep

Thailand ‐ Sep

Singapore ‐ Sep

Taiwan ‐ Sep

Brazil ‐ Aug14© ChartingTHAILAND™


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CONTENT SUMMARY

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Composite Private Consumption IndexA composite index representing private consumption conditions. It comprises of 5 components including Non-durables Index, Semi-durables Index, Durables Index, Services Index, and Non-residents expenditure Index. Prepared by the Bank of Thailand using 2010 as the base year and is released monthly and each component was seasonally adjusted. Chart A shows the Composite Index movement over the latest 2 years. Chart B shows the annual change of each component.

Latest developmentPrivate consumption improved sharply and surpassed last year’s level in September. However, durables and semi-durables goods consumption are still lagging.

Private consumption improved sharply and surpassed last year’s level in September

Chart 1.14a – Composite Private Consumption Index (2010=100)

Source: Bank of Thailand17© ChartingTHAILAND™

www.ChartingThailand.com

13.4

4.8

2.2

0.4

-1.3

-8.7

Non‐resident

Services

Non‐durables

Composite Index

Semi‐durables

Durables

Chart 1.14b – Y‐on‐Y changeSep 2015 vs 2014, percent

80.0

85.0

90.0

95.0

100.0

105.0

110.0

115.0

120.0

125.0


2014

2015


Composite Private Investment IndexA composite index representing private investment conditions. It is constructed from 5 components including Construction Area Permitted in Municipal Zone (9-month moving average), Construction Material Sales Index (3-month moving average), Imports of Capital Goods at 2010 Prices, Domestic Machinery Sales at 2010 Prices, Domestic Car Sales Index for investment (3-month moving average.). The index is prepared by the Bank of Thailand, using 2010 as the base year. Chart A shows the Composite Index movement over the latest 2 years. Chart B shows the annual change of each component.

Latest developmentPrivate Investment started to pick up and has been above last year’s level. Domestic Machinery Sales increased the most from a year ago in September.

Private Investment started to pick up and has been above last year’s level

Chart 1.15a – Private Investment Index (2010=100)

Source: Bank of Thailand18

Chart 1.15b – Y‐on‐Y changeSep 2015 vs 2014, percent

11.7

1.1

0.1

-2.7

-3.4

-6.0

Domestic Machinery sales*(2010 prices, Baht)

Composite Index

Import of Capital Goods(2010 prices, Baht)

Construction Material SalesIndex

Construction Areapermitted (sqm)

Domestic Commercial CarSales Index

© ChartingTHAILAND™www.ChartingThailand.com

113.0

114.0

115.0

116.0

117.0

118.0

119.0

120.0

121.0


20142015

Note: (*) figures are 1‐month delayedCopyright © ChartingTHAILAND™. All rights reserved.

Foreign Direct InvestmentForeign direct investment (FDI) reflects the lasting interests of Non-residents of an economy in a resident entity. A direct investor may invest in equity capital, lending to affiliates, or reinvested earnings. Investment in equity is treated as a direct investment when the direct investors own 10 per cent or more of the voting shares for an enterprise or the equivalent for an unincorporated enterprise. Data is compiled by BOT. The left chart shows the annual figures. The right chart shows the cumulative monthly figures for the current year and the year before.

Latest developmentFDI value increased 28% in the first 8 months of 2015.

FDI value increased 28% in the first 8 months of 2015

Chart 5.14 – Foreign Direct InvestmentMillion USD

Source: BOT

8,562

6,411

14,747

2,474

12,899

15,936

3,720

08FY 09FY 10FY 11FY 12FY 13FY 14FY

Monthly cumulative FDI*

(*) Preliminary figures

0

1,000

2,000

3,000

4,000

5,000

6,000


2014

2015


BOI net applicationValue is derived from total investment of all projects which have foreign equity participation (shown by registered capital amount) of one particular nation or the sum of all foreign registered capital from more than two nations of at least 10%. The chart shows the value of BOI net application for projects defined as FDI.

Latest developmentBOI’s net application almost doubled in 2014, but for the first 8 months of 2015, it has almost been wiped out, registering only THB 50 billion.

BOI’s net application almost doubled in 2014, but for the first 8 months of 2015, it has almost been wiped out

Chart 5.15 – BOI net application of foreign direct investment*Billion Baht

Source: Board of Investment

236

396

648

525

1,023

288

50

10FY 11FY 12FY 13FY 14FY 2014/8M 2015/8M

Note: (*) Foreign investment (foreign equity>=10%)20© ChartingTHAILAND™


BOI net application by countryBOI net application of foreign direct investment projects breakdown by country. FDI from Japan, the biggest source, has declined sharply in 2014.

FDI from Japan, the biggest source, has declined sharply in 2014

Chart 5.16 – BOI net application of FDI* breakdown by country groupPercent of total

Source: Board of Investment; ChartingTHAILAND analysis

49%58% 54%

29%20%

7%

10%7%

17%

5%

8%

7%10%

10%

30%

7%

10%6%

7%13%

2%

4%

2%

13%13%

27%

11%21% 25%

19%

11FY 12FY 13FY 14FY 2015/8M

Europe

Japan

ASEAN ANIEs USA

Others

Note: (*) Foreign investment (foreign equity>=10%)(**) ANIEs: Taiwan, Hong Kong, South Korea 21© ChartingTHAILAND™


Key property indicatorsChart A compares key property indicators during this year to the current month to those in the same period of the previous year. Chart B compares key property indicators in the current month to those of the previous month.

Latest developmentBig surge in Condominium registration in August while the value of land transaction and construction area has decreased from last year in the first 8 months.

Big surge in Condominium registration in August

Chart 1.16a – Y‐on‐Y changeFirst 8 months of 2015 vs those of 2014, percent

Source: Bank of Thailand; ChartingTHAILAND analysis

31.8

1.3

-4.7

-6.1

Condo unit registered

New housing unit

Constr. Area in municipal

Value of land transaction

Chart 1.16b – M‐on‐M changeAug vs Jul 2015, percent

107.4

-1.8

-8.1

4.6



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Trade balanceForeign trade statistics refer to transactions involving movements of goods out of or into the Kingdom of Thailand over a specific time period. It is not equal to the one shown on the Balance of Payment chart due to a few adjustments. The charts show the breakdown of Trade Balance into Export and Import.

Latest developmentImproved trade balance in both THB and USD terms in the first 9 months of 2015. This is the case of import declining more than export.

Improved trade balance so far in 2015 is the case of import declining more than export


Chart 5.03a – Trade balance* in THBFirst 9 months, Billion Baht

Note: (*) Not equal to the one in Balance of Payment decomposition due to few adjustments(**) Excluding Electricity and aircraft export, adjustment for Balance of payment and exchange rate conversion

(***) Excluding Electricity and military import, adjustment for Balance of payment and exchange rate conversion

-1,000

0

1,000

2,000

3,000

4,000

5,000

6,000

Export Import Tradebalance

2014

2015

– = -20

0

20

40

60

80

100

120

140

160

180

200

Export Import Trade balance– =

Chart 5.03b – Trade balance* in USDFirst 9 months, Billion USD

-7.6% -5.0% -10.5%


-1.9%


YTD change in Export by productThe left chart shows the year-to-date change in Baht term of export value by product group. The right chart shows each group’s contribution to the total export growth.

Latest developmentExport, in THB, recovered in September but the first 9 months is still lower than the same period last year. The increase in Automotive and Machinery export were the growth drivers while Petroleum, Chemicals and Agriculture were the main drags to total export growth.

Export recovered in September but the first 9 months is still lower than the same period last year

Chart 5.05a – YTD annual change in Export in BahtFirst 9 months of 2015 vs those of 2014, percent


-1.928.5

25.56.36.2

3.52.31.91.70.5

-0.3-1.5-2.3-4.0-5.0-6.2-6.5-7.8-8.0

-14.3-17.6

-23.0-24.5-25.0

-49.4

Total exportOptical instruOther export

JewelleryAutomotiveMachinery

Other manufacturingPhoto instru

ElectricalElectronics

MetalForestry

Agro productsToiletriesApparelsFootware

AgriculturePetro‐chemical

FurnitureFishery

AircraftsChemicalsPetroleumRe‐exports

Mining

Chart 5.05b – Sectoral contributionsContributions to total export growth

-1.90.9

0.40.30.3

0.20.10.10.10.0

0.00.00.00.00.00.0

-0.1-0.2-0.2-0.2-0.3

-0.5-0.5

-0.9-1.2

Total exportAutomotiveOther exportMachinery

Optical instruJewelleryElectrical

Other manufacturingElectronics

Photo instruForestryMetal

FootwareRe‐exportsFurnitureToiletriesFishery

ApparelsAircraftsMining

Agro productsPetro‐chemical

AgricultureChemicalsPetroleum


Export destinationsThe left chart shows Export value (in Baht term) broken down by country of destination. The right chart shows change in export value to each destination.

Latest developmentNAFTA is the only growing markets for Thai export in the first 9 months of 2015. Middle East was the hardest hit market with export declining 9.8% from a year ago.

NAFTA is the only growing markets for Thai export so far in 2015

Chart 5.07a – Export by countryPercent of total export in THB term


23.0 24.3 24.6 25.9 26.1

20.4 21.0 21.0 21.2 20.3

11.7 11.1 11.4 11.5 12.0

11.3 10.9 9.5 9.8 10.3

10.5 10.7 10.2 9.7 9.65.0 4.7 5.1 5.1 5.2

18.1 17.4 18.1 16.7 16.5

10FY 11FY 12FY 13FY 14FY

ASEAN

NAFTA

East Asiaex‐Japan

EU

Japan

Middle East

Rest of the world

100% = (Trillion)8.3%

-0.8%

-3.0%

-3.3%

-3.4%

-4.1%

-9.8%

NAFTA

Rest of the world

EU

East Asia ex Japan

ASEAN

Japan

Middle East

Chart 5.07b – Change in ExportIn THB term, First 9 months of 2015 vs those of 2014

฿ 6.1 ฿ 6.7 ฿ 7.1 ฿ 6.9 ฿ 7.3


YTD change in Import by product classThe left chart shows the year-to-date change (in Baht term) of import value by product group. The right chart shows each group’s contribution to the total import growth.

Latest developmentImport has decreased 7.6% in the first 9 months of 2015, due mainly to the decrease in Fuel import.

Big decrease in Import so far in 2015 due mainly to decrease in fuel import

Chart 5.09a – YTD annual change in Import in BahtFirst 9 months of 2015 vs those of 2014, percent


Chart 5.09b – Sectoral contributionsContributions to total import growth

-7.6

6.3

-0.3

-0.4

-2.2

-34.5

Total import

Consumer goods

Intermediate ‐ Non fuel

Others

Capital goods

Intermediate ‐ Fuel

-7.6

0.5

0.0

-0.1

-0.5

-7.5

Total import

Consumer goods

Others

Intermediate ‐ Non fuel

Capital goods



Import compositionImport value (in Baht term) breakdown by economic classification into Consumer goods, Intermediate goods, Capital goods and Others.

Latest developmentMost categories have gained more share this year at the expense of Fuel.

Most categories have gained more share this year at the expense of Fuel

Chart 5.08 – Import by economic classificationPercent of total import in Baht term


7.5 7.5 7.8 8.0 8.7 9.7

17.4 18.9 18.9 20.8 20.8 15.4

44.0 40.0 37.5 35.7 38.340.8

20.9 21.3 24.4 23.324.2 25.5

10.2 12.4 11.4 12.2 8.1 8.5

10FY 11FY 12FY 13FY 14FY 15/9MO

Others

Capital goods

Consumer goods

100% = (Trillion)฿ 5.9 ฿ 7.0


Intermediate –Non‐Fuel

฿ 7.8 ฿ 7.4฿ 7.7


฿ 5.2


Tourist arrivalsNumber of the international tourist arrivals into Thailand. Prepared by Department of Tourism using data from Immigration Bureau, Police Department.

Latest developmentTourist arrivals dropped significantly after the Bangkok bomb incident. For the first 9 months, Tourist arrivals still grew impressively at 27.2%.

10.011.7 11.5

14.5 14.115.9

19.2

22.4

26.524.8

05FY 06FY 07FY 08FY 09FY 10FY 11FY 12FY 13FY 14FY

Tourist arrivals dropped significantly after the Bangkok bomb incident

Chart 5.18 – International Tourist ArrivalsMillion visits

Source: Department of Tourism

Monthly arrivalsMillion visits

CAGR10.6%


0.0

0.5

1.0

1.5

2.0

2.5

3.0


2014

2015


Tourist arrivals by nationalityChart A shows the composition of international tourist arrivals by their nationalities grouped by region. Chart B shows the top 10 highest change in arrivals by country and the percent of total arrival change.

Latest developmentStructure of tourist nationalities has changed a bit over the years. East Asia has been the largest group in the last six years and the figure is increasing every year. China and Malaysia have been the two highest growing markets for tourists in 2015.

China and Malaysia have been the two highest growing markets for tourists in 2015

Chart 5.19aInternational Tourist Arrivals by country of nationalityPercent of total

Source: Department of Tourism; ChartingTHAILAND analysis

51.2 53.8 56.0 59.9 58.8

27.9 26.5 25.323.8 24.8

5.3 5.0 4.8 4.4 4.515.6 14.7 13.8 11.9 11.9

10FY 11FY 12FY 13FY 14FY

East Asia

Europe

Americas

Rest of world

Chart 5.19b10 Highest Change in International Tourist Arrivals by country of nationalityFirst 9 months of 2015 vs those of 2014, Thousands

2,917.3

885.8

191.4

177.8

163.6

149.9

128.2

118.1

112.9

69.6

China

Malaysia

Hong Kong

Korea

Taiwan

Vietnam

Japan

India

Singapore

USA



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CONTENT SUMMARY

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Unemployment rateUnemployment rate calculated from labor Force Survey conducted and compiled by the National Statistical Office (NSO). Unemployment rate equals unemployed persons divided by total labor force. Unemployed persons is defined as persons with the age of 15 years and over who during the week in which the survey is conducted, do not work, have no job, business enterprise or farm of their own. Persons in this category include those who are looking for a job, applying for a job or waiting to be called to work during the past 30 days prior to the interview date and those who are not looking for work during the past 30 days prior to the interview date, but are otherwise available for work during the 7 days prior to the interview date. Total labor force comprises current labor force and seasonally inactive labor force.

Latest developmentUnemployment rate decreased and stayed below 1% in September.

Unemployment rate decreased and stayed below 1% in September

Chart 2.08 – Unemployment ratePercent

Source: National Statistical Office, Bank of Thailand

1.83

1.51

1.38 1.381.49

1.04

0.68 0.660.72

0.84

05-Avg 06-Avg 07-Avg 08-Avg 09-Avg 10-Avg 11-Avg 12-Avg 13-Avg 14-Avg0.00

0.20

0.40

0.60

0.80

1.00

1.20

1.40


Monthly Average

2014

2015


Unemployment rates in the worldA comparison of unemployment rates across different countries (economies) compiled by The Economist magazine.

Latest developmentThailand’s unemployment rate is the lowest among leading economies. Euro area still has the highest unemployment rate, followed by Brazil.

Thailand’s unemployment rate is lowest comparing to other leading economies

Chart 2.09 – Unemployment rateLatest, percent


0.8

2.0

3.2

3.2

3.3

3.4

3.4

3.8

4.1

4.9

5.1

5.2

5.8

6.0

6.2

6.5

7.6

10.8

Thailand ‐ Sep

Singapore ‐ Q3

Malaysia ‐ Aug

South Korea ‐ Sep

Hong Kong ‐ Sep

Japan ‐ Sep

Vietnam ‐ 2014

Taiwan ‐ Sep

China ‐ Q3

India ‐ 2013

US ‐ Sep

Russia ‐ Sep

Indonesia ‐ Q1

Pakistan ‐ 2014

Australia ‐ Sep

Philippines ‐ Q3

Brazil ‐ Sep

Euro Area ‐ Sep33© ChartingTHAILAND™



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Interest ratesChart A shows the Bank of Thailand’s policy rate (1-day repo rate) over the last 12 months. Chart B shows the Inter bank overnight rate over the last 12 months. Chart C shows the minimum and maximum of the saving deposit rate over the last 12 months. Chart D shows the minimum and maximum of commercial bank’s MLR over the last 12 months.

Latest developmentNo change in policy interest rate in October. It’s worth noting that the BOT’s policy rate is at 1.50%, which is quite low. This could limit the option to further stimulate growth through monetary policy (by lowering interest rate further).

No change in policy interest rate in October

Chart 3.01a – BOT’s policy rate

Source: Bank of Thailand

Chart 3.01b – BIBOR overnight rate

Chart 3.01c – Saving deposit rate* Chart 3.01d – Commercial bank MLR*

Note: (*) All Commercial Banks registered in Thailand, excluding foreign branches 35© ChartingTHAILAND™www.ChartingThailand.com

1.25%

1.50%

1.75%

2.00%

2.25%

2.50%

Nov-14 Oct-15

0.00%

2.50%

5.00%

7.50%

10.00%

Nov-14 Oct-150.00%

2.50%

5.00%

7.50%

10.00%

Nov-14 Oct-15

Max

Min

Min

Max

1.25%

1.50%

1.75%

2.00%

2.25%

2.50%

Nov-14 Oct-15


Government SpendingThe current government is trying to boost the economy by fiscal spending. In the first 8 months of 2015, government spending increased 9% from the same period last year. While the effectiveness of such program is still in doubt, we see bigger spending from the government in the calendar year of 2015.

Government spending in the first 9 months of 2015 increased 9%

36Source: Bank of Thailand

Chart – Monthly cumulative Fiscal expenditureBillion Baht

0

500

1000

1500

2000

2500

D J F M A M J J A S O N D

2014

2015

© ChartingTHAILAND™www.ChartingThailand.comCopyright © ChartingTHAILAND™. All rights reserved.


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Business and Thai Industries Sentiment IndicesChart A shows Business Sentiment Index has been compiled with BOT survey data of 1,500 businesses. Index = 50 indicates that business sentiment remains stable. Index > 50 indicates that business sentiment has improved. Index < 50 indicates that business sentiment has worsened. Chart B shows Thai Industries Sentiment Index, from The Federation of Thai Industries survey of more than 1,000 industrial enterprises. Index = 100 indicates that industries sentiment remains stable. Index > 100 indicates that industries sentiment has improved. Index < 100 indicates that industries sentiment has worsened.

Latest developmentBusinesses and Industries were still pessimistic in September. Business Sentiment Index improved bust was still below the cutoff level. TISI dropped and remained lower than the cutoff.

Businesses and Industries were still pessimistic in September

Source: Bank of Thailand, The Federation of Thai Industries

Chart 1.18a – Business Sentiment Index*

Note: (*) Below is the interpretation of the index:Index = 50 indicates that business sentiment remains stableIndex > 50 indicates that business sentiment has improvedIndex < 50 indicates that business sentiment has worsened

Chart 1.18b – Thai Industries Sentiment Index**

Note: (*) Below is the interpretation of the index:Index = 100 indicates that industries sentiment remains stableIndex > 100 indicates that industries sentiment has improvedIndex < 100 indicates that industries sentiment has worsened


45.250.3 49.1

46.4 46.4 47.3

0

50

100


Better

Worse

86.2 85.4 84.0 83.0 82.4 82.8

0

100

200


Better

Worse


Consumer Confidence IndexPrepared by Ministry of Commerce through monthly consumer survey nationwide. The index ranges from 0 to 100. 50 means consumer confidence is equal to those of the prior month. Over 50 means consumer confidence is better than those of the prior month. Under 50 means consumer confidence is worse than those of the prior month.

Latest developmentConsumers were less pessimistic in September as the overall index increased from 34.6 to 35.4. As the index is still below the cut off level, consumers are still pessimistic about the economy.

Consumers were less pessimistic in September

Source: Ministry of Commerce

Chart 1.17 – Consumer Confidence Index

Note: (*) The index ranges from 0 to 10050 means consumer confidence is equal to those of the prior monthOver 50 means consumer confidence is better than those of the prior monthUnder 50 means consumer confidence is worse than those of the prior month 39© ChartingTHAILAND™


0

50

100

Mar-15 May-15 Jul-15 Sep-150

50

100


50

100


Overall On job

Better

Worse

On future income

Better

Worse

Better

Worse



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Real GDP growth projectionsReal GDP growth projections from Bank of Thailand, National Economic and Social Development Board (NESDB), Fiscal Policy Office (FPO) and the weekly poll conducted by the Economist magazine. The charts also show growth projections as of past dates, which highlight any significant change in projections from each of the forecasters. The changes in projections normally reflect the economic outlook as seen by each forecaster.

Growth projections for the Thai economyFPO revised down 2015 growth again in October. Consensus growth forecast is now 2.7-3.4% for 2015 and 3.7-4.0% for 2016.

FPO revised down 2015 growth again in October

Chart 1.03a – Real GDP growth projectionsFor 2015, Annual percentage change

Source: NESDB, Fiscal Policy Office, Bank of Thailand, The Economist

Chart 1.03b – Real GDP growth projectionsFor 2016, Annual percentage change

Copyright © ChartingTHAILAND™. All rights reserved.41© ChartingTHAILAND™


2.00

2.50

3.00

3.50

4.00

4.50

5.00

5.50

6.00

M-15 A-15 M-15 J-15 J-15 A-15 S-15 O-15

Forecast as of, month ending

BOT

FPOThe Economist

poll

NESDB

Forecast as of, month ending

2.00

2.50

3.00

3.50

4.00

4.50

5.00

5.50

6.00

M-15 A-15 M-15 J-15 J-15 A-15 S-15 O-15

BOT

The Economist poll

FPO

International real GDP growth projectionsReal GDP growth projection consensus for major economies in the world as a result of a weekly survey by the Economist magazine. It offers a good comparison across economies in the world.

Growth outlook for the Thai economyAccording to the Economist poll, Thailand’s GDP growth is expected to be 3.4% for 2015 and 4.0% for 2016, around the middle when compared to other major and emerging economies.

Growth for Thailand is projected to be around the middle of the pack

Chart 1.04a – Real GDP growth projections2015, Annual % change, as of Oct 31st 2015


Chart 1.04b – Real GDP growth projections2016, Annual % change, as of Oct 31st 2015

7.46.8

6.46.3

5.75.4

4.83.4

3.22.9

2.52.42.42.3

1.50.7

-2.7-3.8

IndiaChina

PhilippinesVietnamPakistanMalaysiaIndonesiaThailandTaiwan

SingaporeUS

South KoreaHong KongAustraliaEuro Area

JapanBrazilRussia


7.76.56.5

6.36.1

5.14.7

4.03.0

2.82.62.62.6

2.11.7

1.2-0.3

-0.9

IndiaChina

VietnamPhilippinesMalaysiaIndonesiaPakistanThailand

SingaporeSouth Korea

TaiwanAustralia

USHong KongEuro Area

JapanRussiaBrazil



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Consumer Price IndexCPI is the general price level of goods and services purchased by consumers. Prepared by Bureau of Trade and Economic Indices, Ministry of Commerce. Available in various definitions and by product groups. Change in CPI is normally used as main indicator for inflation.

Latest developmentHeadline CPI suggests deflation but it was heavily skewed by energy price. CPI of most products actually increased from a year ago.

Headline CPI suggests deflation but it was heavily skewed by energy price

Source: Bureau of Trade and Economic Indices; ChartingTHAILAND analysis

Chart 3.07a – Y‐o‐Y change in CPIPercent

Chart 3.07b – Y‐o‐Y change in CPI by productOct 2015, percent

Note: (*) exclude raw food and energy

9.0

2.1

1.8

1.2

1.1

1.0

0.5

0.4

0.3

0.1

0.1

-0.2

-0.2

-6.5

-15.5

Veg & fruit

Tobacco & alcohol

Food away from home

Recreation & Education

Prepared food at home

Medical care

Non alcoholic beverage

Apparel and footware

Meat

Housing & furnishing

Rice

Seasoning

Eggs & milk

Transport & Commu

Energy


-1.50%

-1.00%

-0.50%

0.00%

0.50%

1.00%

1.50%

May-15 Jun-15 Jul-15 Aug-15 Sep-15 Oct-15

Head line

Core*


Inflation in the worldChange in Consumer Price Index across major economies in the world. Also the projected CPI change for the full year by the Economist poll.

Latest developmentAlong with Singapore, Thailand’s latest CPI is still lower than a year ago.

Along with Singapore, Thailand’s latest CPI is still lower than a year ago

Chart 3.08 – Consumer Price IndexAnnual percentage change


Latest 2015*

Note: (*) The Economist Poll

15.2

8.9

6.4

5.1

2.5

3.1

1.6

3.9

1.7

0.8

2.4

0.7

0.3

2.5

0.1

0.1

0.2

0.8

15.7

9.5

6.8

4.4

2.6

2.0

1.6

1.3

1.5

0.6

0.4

0.0

0.0

0.0

0.0

0.3

-0.6

-0.8

Russia ‐ Sep

Brazil ‐ Sep

Indonesia ‐ Sep

India ‐ Sep

Malaysia ‐ Sep

Hong Kong ‐ Sep

China ‐ Sep

Pakistan ‐ Sep

Australia ‐ Q3

South Korea ‐ Sep

Philippines ‐ Sep

Japan ‐ Sep

US ‐ Sep

Vietnam ‐ Oct

Euro Area ‐ Oct

Taiwan ‐ Sep

Singapore ‐ Sep

Thailand ‐ Oct


Producer Price IndexInflation at the producer level is measured by a change in Producer Price Index. Prepared by Bureau of Trade and Economic Indices, Ministry of Commerce. The chart shows the changes of the overall PPI and also the PPI of each industry.

Latest developmentPPI continues to be lower than a year ago, due largely to energy price. However, PPI of other products, almost half, also decreased from a year ago.

PPI continues to be lower than a year ago, due largely to energy price

Source: Bureau of Trade and Economic Indices; ChartingTHAILAND analysis

Chart 3.09a – Y‐o‐Y change in PPIPercent

Chart 3.09b – Y‐o‐Y change in PPI by productOct 2015, percent

3.9

3.1

2.2

2.2

0.7

0.5

0.5

0.2

0.0

0.0

-0.1

-0.4

-1.3

-2.1

-2.9

-2.9

-4.2

-4.9

-11.0

-26.5

Other manu goodsPulp & paper

EnergyCrop

TextileLeather & footware

WoodMechineryForestryForestry

Non‐metallic mineralFoodMetal

Electrical equipLivestocks

Rubber & plasticChemical

Basic metalsFishing

Petroleum products


-6.0%

-5.0%

-4.0%

-3.0%

-2.0%

-1.0%

0.0%

1.0%

2.0%

3.0%




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Bank’s Loan and Loan-to-deposit ratioCommercial banks take deposits and give out loans. Chart A shows the outstanding loan by commercial banks in Thailand. Chart B shows the commercial banks’ loan to deposit ratio, a liquidity indicators in the banking system.

Latest developmentBank’s loan increased only 0.3% in August 2015. Liquidity in the system was squeezed further as the Loan-to-Deposit ratio increased to 97.3%.

Bank’s loan is still growing and liquidity is slightly squeezed

Chart 3.02b – Commercial Banks’ Loan/Deposit* ratioPercent


Chart 3.02a – Commercial Banks’ LoanTHB billion


97.2%96.4%

95.7% 95.7%94.9% 94.8% 94.5% 94.5%

95.4%96.5%

97.1% 97.3%

90%

95%

100%

Sep-14 Oct-14 Nov-14 Dec-14 Jan-15 Feb-15 Mar-15 Apr-15 May-15 Jun-15 Jul-15 Aug-15

10,600

10,800

11,000

11,200

11,400

11,600

Sep-14 Oct-14 Nov-14 Dec-14 Jan-15 Feb-15 Mar-15 Apr-15 May-15 Jun-15 Jul-15 Aug-15

Y-o-Y+4.8%

M-o-M+0.3%


Non-performing loanGross NPLs: the outstanding amount of loans classified as substandard, doubtful, doubtful of loss, and loss. The chart shows Gross Non-performing loan from all Financial Institutions in Thailand, both in the absolute and percentage of total terms.

Latest developmentGross NPL continued to rise in 3Q15. The absolute value increased from THB 312 billion to THB 361 billion or 2.38% to 2.79% of the total loan.

Gross NPL continued to rise in both absolute value and percentage of total loan in the 3Q15

Chart 3.03a – Total Financial Institutions’ Gross NPLs OutstandingBillion Baht


458 401 380 317 270 256 267 278 299 312 361

07YE 08YE 09YE 10YE 11YE 12YE 13YE 14YE 2015/Q1 2015/Q2 2015/Q3

7.31%

5.29% 4.85%3.60%

2.75% 2.26% 2.16% 2.16% 2.29% 2.38% 2.79%

07YE 08YE 09YE 10YE 11YE 12YE 13YE 14YE 2015/Q1 2015/Q2 2015/Q3

Chart 3.03b – Total Financial Institutions’ Gross NPLs OutstandingPercentage of Total Loans


Capital ratio of all commercial banksCapital funds of commercial banks mean stockholders’ equity. Risk assets mean summary of all risk-weighted assets including contingent liabilities converted into assets and weighted by risk ratio. The higher the ratio the safer and more stability in the banking system.

Latest developmentBanks’ capital ratio increased to 17.2% in August and still remained high.

Banks’ capital ratio increased in July and still remained high


Chart 3.04 – Capital ratio of all commercial banks*% of risk assets, at year end

Note: (*) All Commercial Banks registered in Thailand, excluding foreign branches

12.4%13.3%

13.9%14.9%

14.0%

15.8% 16.1%

14.8%

16.2%15.7%

2004 2005 2006 2007 2008 2009 2010 2011 2012 201314.5%

15.0%

15.5%

16.0%

16.5%

17.0%

17.5%


Month End

2014

2015


Real interest rates in the worldChart shows one way to calculate real interest rates across different currencies and economies in the world. Today’s Real interest rates = Nominal interest rates (represented here by 3-month risk free interest rates) – expected inflation.

Latest developmentThere are quite a few countries with negative real interest rates. Countries with negative real interest rates seems to have low nominal interest rates to begin with. Thailand’s real interest rate is around 1%.

Thailand’s real interest rate is around 1%

Chart 3.05 – Real interest rates Percent, as of Oct 30th 2015


3M risk‐free interest rates Expected 2015 inflation* Real interest rates─ =

Note: (*) Applying 10-year bond for Singapore due to lack of 3-month interest rate data 51© ChartingTHAILAND™www.ChartingThailand.com

14.4

12.4

8.3

7.1

6.5

4.7

3.8

3.0

2.5

2.3

1.8

1.6

1.5

0.9

0.4

0.3

0.1

-0.1

Brazil

Russia

Indonesia

India

Pakistan

Vietnam

Malaysia

China

Singapore*

Australia

Philippines

South Korea

Thailand

Taiwan

Hong Kong

US

Japan

Euro Area

5.5

-2.8

1.9

2.0

2.6

2.2

1.3

1.4

2.3

0.6

-0.6

0.8

0.7

0.8

-2.7

0.0

-0.6

-0.2

8.9

15.2

6.4

5.1

3.9

2.5

2.5

1.6

0.2

1.7

2.4

0.8

0.8

0.1

3.1

0.3

0.7

0.1


Stock market performanceChart A shows the monthly performance of the SET index. Chart B shows the performance, change in the index level, of key stock markets in the world, since the end of last year.

Latest developmentSET index increased 3.4% in October when the foreign sell out seemed to stop. Along with other emerging markets, SET has declined year-to-date.

SET index gained 3.4% in October when foreign sell out seemed to stop

Chart 3.06c – Change since Dec 31st 2014Percent, as of Oct 28th 2015

Source: SET, The Economist; ChartingTHAILAND analysis

22.0%

14.5%

10.5%

9.8%

8.3%

7.6%

6.6%

6.0%

4.3%

1.5%

-0.2%

-0.3%

-1.7%

-2.0%

-2.7%

-4.2%

-5.9%

-6.9%

-9.6%

-11.8%

China (SSEB, $ terms)

France (CAC 40)

Germany (DAX)

Euro Area (FTSE Euro 100)

Japan (Nikkei 225)

US (NAScomp)

S Korea (KOSPI)

Pakistan (KSE)

China (SSEA)

US (S&P 500)

US (DJIA)

Australia (All Ord.)

India (BSE)

UK (FTSE 100)

HK (Hang Seng)

Malaysia (KLSE)

Thailand (SET)

Taiwan (TWI)

Singapore (STI)

Indonesia (JSX)

Chart 3.06a – Monthly performance of SET indexPercent change from prior month, at month end

-2.0%

0.6%

-4.3% -4.0%

-2.4%

3.4%


Chart 3.06b – Cumulative net foreign fund flowSET & MAI, Billion Baht, Month end


-120.0

-100.0

-80.0

-60.0

-40.0

-20.0

0.0

J-15 F-15 M-15 A-15 M-15 J-15 J-15 A-15 S-15 O-15 N-15 D-15


http://goo.gl/6FZNS9


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Budget balance vs GDPOverall Cash balances are the sum of budget and non budget cash balances. Budget cash balances are the government revenues net of the government expenditures. Non budget cash balances include changes in governmental agencies’ deposit accounts and net positions of government’s revolving funds. The chart shows both Overall Cash balances and Budget cash balances as percentage of nominal GDP.

Latest developmentGovernment budget and cash balances have been in deficit in 7 of the last 10 years. The magnitude of the deficits in the past 5 years have been huge. The worst deficits in relative to GDP were in 2009 (calendar year), with budget deficit of 4%. Huge government budget deficit in 2012, only slightly better than in 2009. Higher budget and cash deficit as percentage of GDP in 2014.

Higher government deficit as percentage of GDP in 2014

Chart 4.1 – Government budget and cash balance as percentage of nominal GDPPercent


-0.5%

1.3%

-1.9%

-1.0%

-3.8%

-0.7%-0.2%

-3.4%

-2.1% -2.2%

-0.6%

1.0%

-1.6%

-1.0%

-4.2%

-2.5%

-0.8%

-3.8%

-1.9%-2.3%


Budget cash balanceOverall Cash balance (including non-budgetary deficit/ surplus)


Budget balanceBudget balances are the government revenues net of the government expenditures. The left chart shows government revenue, government expenditure and budget balance (line). The right chart shows monthly cumulative of budget balance of the last two years.

Latest developmentGovernment budget balances have been in deficit in 9 of the last 10 years. The magnitude of the deficits in the past 5 years have been huge. The worst deficits in absolute term were in 2012 (calendar year), with budget deficit of 414 Billion Baht. In 2014, Budget deficit increased from 2013. Budget deficit in the first 9 months of 2015 is almost THB 20 billion worse off than the same period last year.

Budget deficit in the first 9 months of 2015 is almost THB 20 billion worse off than the same period last year

Chart 4.2 – Government budget balanceBillion Baht


1,2411,390 1,455 1,498 1,484

1,7511,902

2,075 2,158 2,076

-1,277 -1,280

-1,629 -1,598-1,849 -1,825 -1,930

-2,489 -2,424 -2,371

-36110

-174 -100-364

-75 -27

-414-267 -295


Revenue

Expenditure

Budgetbalance

Monthly cumulative Budget balance(Billion Baht)


-350

-300

-250

-200

-150

-100

-50

0

50


2014

2015


Budget and Cash balanceOverall Cash balances are the sum of budget and non budget cash balances. Budget cash balances are the government revenues net of the government expenditures. Non budget cash balances include changes in governmental agencies’ deposit accounts and net positions of government’s revolving funds. The chart shows both Overall Cash balances and Budget cash balances in absolute term.

Latest development2012 saw the biggest budget and cash deficit in THB term. Apart from 2010, Budget cash balance and Overall cash balance are typically in line with each other. Budget and cash deficits in the first 9 months were in line .

Budget and cash deficits in the first 9 months were in line

Chart 4.3 – Government cash balanceBillion Baht


-36

110

-174

-100

-364

-75

-27

-414

-267-295

-21-45

88

-144

-96

-401

-266

-95

-466

-242

-305

-20

05FY 06FY 07FY 08FY 09FY 10FY 11FY 12FY 13FY 14FY '15/9mo

Budget cash balanceOverall Cash balance (including non-budgetary deficit/ surplus)


Budget balance in the worldConsensus projection of Government budget balance as percentage of GDP across major countries in the world for the current year. The data is compiled by the Economist poll.

Latest developmentMost governments in the world are expected to have budget deficits in 2013, except South Korea, Hong Kong, Singapore and Russia. The magnitude of the expected budget deficits are greatest in US and Japan, the leading economies in the world. Thailand budget deficit is expected to be around 2% of GDP.

Thailand’s budget deficit is expected to be around 2% of GDP

Chart 4.4 – Government Budget balance as percentage of GDP2015*, percent


0.3

0.0

-0.7

-1.0

-1.9

-2.0

-2.0

-2.1

-2.4

-2.6

-2.7

-2.8

-3.8

-4.0

-4.2

-5.1

-6.0

-6.8

South KoreaHong KongSingapore

TaiwanPhilippinesIndonesiaThailand

Euro AreaAustralia

USChinaRussiaIndia

MalaysiaVietnamPakistan

BrazilJapan

Note: (*) The Economist Poll 58© ChartingTHAILAND™www.ChartingThailand.comCopyright © ChartingTHAILAND™. All rights reserved.

Composition of Public debtPublic debt includes direct government debt, Bond to Compensate FIDF's Loss, Debt Prefunding, Non-Financial State Enterprise Debt, Special Financial Institutions Guaranteed Debt, and others. Chart A shows the level of debt in THB. Chart B shows the level as percentage of nominal GDP.

Latest developmentPublic debt as percentage of GDP increased significantly since 2009 then dropped slightly in 2011 before increasing again. Public debt increased in absolute term and relative to GDP in 2012 and 2013, due largely to direct government debt. A slight increase in Public debt so far in 2015, at THB 5.7 trillion, or 43% of GDP. Majority of the public debt is domestic based.

A slight increase in Public debt so far in 2015

Source: Public Debt Management Office

Chart 4.5a – Composition of Public debt THB Trillion

Chart 4.5b – Composition of Public debt As percentage of nominal GDP

8% 8% 7% 7% 6%External debtas percent of total


0.0

1.0

2.0

3.0

4.0

5.0

6.0

2011 2012 2013 2014 Aug-150%

5%

10%

15%

20%

25%

30%

35%

40%

45%

2011 2012 2013 2014 Aug-15

Direct Government debtDirect Government debt

Bond to Compensate FIDF's Loss & Prefunding debt

Bond to Compensate FIDF's Loss & Prefunding debt

Public debt from State Enterprises

Public debt from State Enterprises


Public debt in the worldPublic debt as percentage of nominal GDP, data is compiled by CIA.

Latest developmentHigh public debt ratio in most developed countries. Thailand’s public debt ratio, at 49% of GDP in 2014, is below international rule of thumb of 60%. Japan has the highest public debt level compared to GDP, at 228%. Majority of countries with high public debt level comes from Europe, leading by Greece, Italy, Portugal and Ireland.

Thailand’s public debt is not high compared to international standard

Chart 4.6 – Public debt in the worldPercentage of GDP, 2014 est.

Source: CIA fact book

228181

175142

134132131

119119

110107

1021011019896949494939290898786

1 Japan2 Zimbabwe

3 Greece4 Lebanon

5 Italy6 Jamaica7 Portugal8 Cyprus9 Ireland

10 Grenada11 Singapore12 Belgium13 Eritrea

14 Barbados15 Spain

16 France17 Iceland18 Egypt

19 Puerto rico20 Canada21 Bhutan22 Jordan

23 Antigua and barbuda24 UK

25 Cabo verde

7170676564

59545149484646

4140383737373030242213122

39 United states40 Croatia43 Israel

48 Uruguay50 Pakistan

56 Brazil63 Malaysia

67 India71 Thailand

72 Philippines78 Laos

80 Vietnam93 Mexico96 Sweden

101 Argentina103 South Korea105 Hong kong

108 Turkey126 Nepal

129 Norway133 Indonesia

137 China147 Russia149 Nigeria

164 Saudi arabia

Int’l rule of thumb<60% of GDP


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tability


Balance of payment decompositionBalance of Payments is a summary of economic transactions between residents and nonresidents that takes place during a specific time period. Balance of Payments include Trade balance, Net services income & transfers, Capital and financial account and Net errors & omissions.

Latest developmentPositive Balance of Payment so far in 2015 of USD 4.4 billion, thanks to trade surplus.

Positive Balance of Payment so far in 2015, thanks to trade surplus


Chart 5.01 – Balance of Payment decompositionBillion USD

Trade Balance (F.O.B)

Net service income & transfer

Net Capital Movement + errors and omissions

+


31.3

1.25.3

-5.0-1.2

4.9

10FY 11FY 12FY 13FY 14FY 15/9mo

29.8

17.0

6.7 6.7

24.6 24.9

10FY 11FY 12FY 13FY 14FY 15/9mo

-19.7

-8.1 -8.2-11.8 -9.2

-4.0

10FY 11FY 12FY 13FY 14FY 15/9mo

21.3

-7.7

6.8 0.1

-16.6 -16.0

10FY 11FY 12FY 13FY 14FY 15/9mo


Current Account BalanceCurrent Account represents the net sum of trade in goods and services, primary income and secondary income. The left chart shows the consensus projection of 2012 Current Account Balance as percentage of GDP by the Economist poll. The right chart shows last 12-month Current Account Balance of major economies in the world, in absolute dollar term

Latest developmentCountries that are expected to have huge Current Account surplus are mostly from Emerging Asian economies. US is still expected to be net spenders. Thailand’s Current Account balance in 2015 is expected to be 2.4% of GDP.

Strong Asian export engines reflecting in huge current account surplus

Chart 5.02 – Current Account balance


21.2%

12.8%

6.7%

4.9%

4.1%

3.1%

2.8%

2.8%

2.8%

2.7%

2.5%

2.4%

-0.7%

-1.1%

-2.5%

-2.5%

-3.7%

-4.2%

Singapore ‐ Q2

Taiwan ‐ Q2

South Korea ‐ Aug

Russia ‐ Q3

Philippines ‐ Jun

China ‐ Q2

Hong Kong ‐ Q2

Japan ‐ Aug

Euro Area ‐ Aug

Vietnam ‐ 2014

Malaysia ‐ Q2

Thailand ‐ Q2

Pakistan ‐ Q2

India ‐ Q2

Indonesia ‐ Q2

US ‐ Q2

Australia ‐ Q2

Brazil ‐ Sep

69.5

72.8

104.8

64.3

11.7

287.8

7.4

118.8

353.4

9.1

8.8

24.4

-2.6

-25.9

-21.6

-429.0

-47.4

-79.3

Last 12 months, USD BillionAs % of 2015 GDP*

Note: (*) The Economist Poll 64© ChartingTHAILAND™www.ChartingThailand.comCopyright © ChartingTHAILAND™. All rights reserved.

External DebtExternal debt refers to the remaining outstanding portion of liabilities (excluding equity) which residents have over nonresidents of an economy. Prepared by the Bank of Thailand and released quarterly. Chart A shows external debt level in USD term. Chart B shows external debt level as percentage of GDP.

Latest developmentExternal debt level decreased slightly to USD 136.6 Billion at the end of 2Q15. External debt as percentage of GDP decreased slightly to 33.2%.

External debt decreased slightly so far in 2015

Chart 5.10a – External Debt LevelBillion USD


69.0 74.4 76.1 75.3100.6 104.3

130.7 139.9 140.7 136.6

06YE 07YE 08YE 09YE 10YE 11YE 12YE 13YE 14YE 15/2Q

38.5% 35.4% 31.4% 28.8%35.2% 33.7%

38.0% 38.2% 34.5% 33.2%

06YE 07YE 08YE 09YE 10YE 11YE 12YE 13YE 14YE 15/2Q

Chart 5.10b – External Debt as % of GDP


External debt compositionBreakdown of external debt. Chart A shows the external debt breakdown by borrowers. Chart B shows the external debt breakdown by maturity.

Latest developmentExternal debt structure has continued to shift toward more long-term debt, which lowers the risk of not having enough foreign exchange to service external debt.

External debt structure has continued to shift toward more long‐term debt


84% 80% 82% 82% 83%

16% 20% 18% 18% 17%

11YE 12YE 13YE 14YE 15/2Q

Chart 5.11a – External debt breakdown Private vs Public

Chart 5.11b – External debt breakdownLong‐Term vs Short‐Term

Private Public = General Government and Monetary Authorities

55% 56% 57% 60% 60%

45% 44% 43% 40% 40%

11YE 12YE 13YE 14YE 15/2Q

Long termShort term


External Debt repayment capabilityA look at the country’s capabilities of servicing the external debt. Chart A shows the country’s international reserves as percentage of short-term external debt. Chart B shows the external debt service ratio (Debt service payment / Export of goods and services).

Latest developmentDebt service ratio increased sharply to 8.1% in 2Q15. However, International reserves (as % of ST external debt) is still at healthy level (293%). Capability to repay external debt is not yet a concern at the moment.


340%370%

312%

279% 277%293%

10YE 11YE 12YE 13YE 14YE 15/2Q

Chart 5.12a – International reserves As % of ST external debt

Chart 5.12b – Debt service ratio*Percent

Note: (*) Debt service payment / Export of goods and services

4.7%

3.4%

4.2% 4.0%

4.7%

8.1%

10FY 11FY 12FY 13FY 14FY 15/2Q

Big surge in external debt payment in 2Q15


International reservesInternational reserve assets refer to external assets that are held or controlled by central bank and are readily available for immediate uses, for instance, in financing payment imbalances or in implementing exchange rate policy. The figures also include the net forward position (future assets/liabilities arising from currency forward contracts between BOT and the market). Chart A shows international reserves level in US$ term. Chart B shows as number of months that it can finance import.

Latest developmentInternational reserves in US$ term have been decreasing since its peak in 2011. So far in 2015, the reserves decreased slightly but the number of months that it can finance import remained at 9.7 months, which is still considered excessive.

Net International reserves decreased slightly in 2015 but still considered excessive

Chart 5.13a – International reserves level*At the end of period, Billion USD


6.99.1

7.9

13.812.6

10.8 9.9 9.1 9.5 9.7

2006 2007 2008 2009 2010 2011 2012 2013 2014 Sep-15

Chart 5.13b – International reserves as number of months of import**

Note: (*) Including Net Forward position(**) For the last period using average monthly import value during the last 12 months

73.9 106.5 118.0 154.1191.7 206.4 205.8 190.2 180.2 168.8

2006 2007 2008 2009 2010 2011 2012 2013 2014 Sep-15


Exchange ratesNominal Effective Exchange Rate (NEER) has been constructed from the weighted average of bilateral exchange rates of the baht vis-à-vis Thailand’s 23 major trading partners and trade competitors. The weight of each currency varies according to how important the country is as a trading partner and trade competitor. An increase in NEER refers to an appreciation. Chart B shows the year-on-year change of average selling rates of selected currencies.

Latest developmentNominal Effective Exchange Rate was unchanged in October. Over the last 12 months THB depreciated 0.4% against key currencies. USD has appreciated the most against THB during the period.

THB was stable in October


Chart 5.17a – Nominal Effective Exchange Rate 2007=100

Chart 5.17b – Y‐o‐Y change in FX rate*Percentage change in avg. selling rate as of Oct 30th 2015

19.4

13.0

12.8

4.6

4.0

0.5

0.0

-1.0

-2.3

-2.4

-4.5

-4.8

-5.3

-6.3

-8.7

MYR ‐ 8.429

MXN ‐ 2.15

AUD ‐ 25.6645

EUR ‐ 39.4362

IDR ‐ 2.7675

JPY ‐ 29.7506

SGD ‐ 25.6677

KRW ‐ 0.0313

TWD ‐ 1.0991

INR ‐ 0.5772

PHP ‐ 0.7737

GBP ‐ 54.9621

CNY ‐ 5.6739

VND ‐ 0.0016

USD ‐ 35.7589

Note: (*) Positive numbers mean the Baht has been depreciated against those currencies, the opposite applies to negative numbers

USD = US$, GBP = Pound Sterling, EUR = Euro, JPY = Yen (per 100), CNY = Yuan Renminbi, SGD = Singapore $, MYR = Malaysia Ringgit, PHP = Philippines Peso, IDR = Indonesia Rupiah (per 1,000), INR = India Rupee,KRW = Korea Won, TWD = Taiwan $, VND = Vietnam Dong, MXN = Mexico Peso, AUD = Australia $


100.0

102.0

104.0

106.0

108.0

110.0

112.0

114.0

Oct-14 Jan-15 Apr-15 Jul-15 Oct-15

M‐o‐M‐0.0%

Y‐o‐Y‐0.4%

Baht appreciates

Baht depreciates


Baht depreciates Baht appreciates

70

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CTE Monthly Brief November 2015

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