Attachment
"Economic indicators in May 2015 showed that for the demand side, the government expenditures supported economy, while private consumption and private investment showed slowing signs. Meanwhile, exports continued to contract. The supply-side economy was significantly supported by the strong growth of tourism sector even though agricultural sector continued to contract and drought situation should be monitored closely. Thailand's internal and external economic stabilities remained robust."
1.Private consumption in May 2015 showed slowing signs. This was reflected by real VAT collection from domestic consumption base in May 2015, which continued to increase by 11.6 percent per year. Meanwhile, real VAT collection from imports continued to contract by -19.4 percent per year. As a consequence, overall real VAT collection in May 2015 decreased by -2.5 percent per year. Motorcycle sales in May 2015 contracted consecutively for two months. Motorcycle sales decreased by -5.4 percent per year following the contraction of motorcycle sales in Bangkok and other regions. After seasonal adjustment, the motorcycle sales expanded by 16.3 percent per month. Meanwhile, passenger car sales in May 2015 continued to contract by -21.1 percent per year.Consumer Confidence Index in overall economy in May 2015 was 65.0 points lowest in 11 months. This was due to the anxiety of an unclear recovery of the Thai economy. In addition, agricultural prices particularly in paddy and rubber remained at low level resulting in the slowdown in domestic purchasing power. In addition, the imports of consumer goods in May 2015 contracted by -1.4 percent per year.
Private Consumption 2014 2014 2015
Indicators Q1 Q2 Q3 Q4 Q1 2M/Q2 Apr May YTD
Real Value Added Tax Collection (%yoy) 0.4 -0.2 0.3 2.3 -0.9 1.0 0.02 2.5 -2.5 0.6
%qoq_SA /%mom_SA -0.7 -1.7 1.5 0.1 0.6 - -2.8 -2.8 -
Imports of Consumer Goods (%yoy) 1.5 -3.8 0.4 0.2 8.1 10.0 -0.2 1.0 -1.4 6.3
%qoq_SA / %mom_SA -3.0 3.2 0.4 6.9 -0.5 - -0.9 -6.9 -
Passenger Car Sales (%yoy) -41.4 -55.3 -37.7 -38.3 -27.9 -12.5 -23.0 -24.7 -21.1 -16.7
%qoq_SA / %mom_SA -23.5 0.0 -6.2 0.1 -6.4 - -1.5 -9.1 -
Motorcycle Sales (%yoy) -14.3 -20.8 -18.2 -8.1 -7.8 10.9 -11.4 -18.4 -5.4 2.0
%qoq_SA / %mom_SA -8.7 -1.7 6.2 -3.2 9.7 - -31.3 16.3 -
Farmers’ real incomes (calculated by FPO) -8.5 -3.0 -4.5 -7.7 -14.5 -11.2 -14.3 -17.6 -10.7 -12.2
Consumer Confidence Index 65.0 59.9 61.2 69.3 69.6 68.4 65.5 66.0 65.0 67.2
2.Private investment in May 2015 showed slowing signs. The investment in construction sector as reflected by cement sales in May 2015 decreased by -0.5 percent per year but expanded by 2.8 percent m-o-m SA. The Construction Materials Price Index (CMI) in May 2015 contracted by -4.3 percent per year due to the declining prices in cement, concrete products, steel and steel products, and electrical and plumbing sector which was cause by the decrease in energy and input prices including the decreasing prices in world steel market. The real estate tax collection in May 2015 contracted by -11.3 percent per year. The investment in equipment and machinery sector as reflected by commercial car sales in May 2015 continued to contract by -19.7 percent per year but expanded by 2.1 m-o-m SA. The imports of capital goods in May 2015 contracted by -5.3 percent per year. However, after excluding special items like aircraft, ship, and train, the imports of capital goods contracted by -7.7 percent per year.
Private Investment Indicators 2014 2014 2015
Q1 Q2 Q3 Q4 Q1 2M/Q2 Apr May YTD
Construction sector
Real estate tax collection (%yoy) -2.2 -5.6 -5.9 -2.1 3.9 7.2 -1.7 10.0 -11.3 3.6
%qoq_SA / %mom_SA -8.1 -3.7 9.8 6.4 -4.6 - 4.2 -14.8 -
Cement sales (%yoy) -3.2 -2.4 -3.0 -2.9 -4.8 -2.5 -1.8 -3.3 -0.5 -2.2
%qoq_SA / %mom_SA -2.1 0.5 -2.1 -1.2 0.6 - -2.1 2.8 -
Construction Materials Price Index (CMI) 0.7 1.1 1.4 1.2 -0.8 -3.7 -4.3 -4.3 -4.3 -3.9
Machinery sector
Commercial car sales (%yoy) -26.8 -36.6 -30.6 -20.4 -15.8 -11.3 -23.6 -27.3 -19.7 -16.0
%qoq_SA / %mom_SA -13.8 -2.8 0.3 -0.9 -7.0 - -10.9 2.1 -
Imports of capital goods (%yoy) -7.6 -14.1 -12.6 0.0 -2.9 0.9 0.0 5.5 -5.3 0.5
%qoq_SA / %mom_SA -5.1 0.6 6.7 -5.2 -0.2 - 8.6 -7.7 -
Imports of capital goods (exclude -4.8 -11.4 -4.4 -4.0 1.3 0.1 -5.7 -3.7 -7.7 -2.3
aircraft, ship, and train) (%yoy)
%qoq_SA / %mom_SA -0.1 1.4 0.0 -0.2 -0.9 - 2.1 -5.1 -
3. Fiscal indicators in May 2015 reflected that government expenditure importantly supported the expansion of economy.The budget disbursement in May 2015 was amounted at 176.8 billion baht or expanded by 14.6 percent per year. The budget disbursement of current fiscal year was disbursed at 164.0 billion baht or increased by 15.1 percent per year. This amounts comprised of (1) current year expenditure of 139.5 billion baht increasing by 10.9 percent per year and (2) capital expenditure of 24.4 billion baht increasing by 47.2 percent per year. The net government revenue collection (net of local authorities' allocation) amounted at 224.8 billion baht or contracted by -19.3 percent per year. This comprised of (1) tax collection from consumption base (VAT) which decreased by -3.8 percent per year due to a decrease in VAT collection from import, which decreased by -20.5 percent per year due to the declining crude oil price. Meanwhile, VAT collection from domestic consumption base expanded by 10.1 percent per year. (2) Tax collection from income base decreased by 18.5 percent per year. Corporate income tax collection decreased by -23.6 percent per year while personal income tax collection increased by 1.8 percent per year. As a result, in May 2015 the budget balance showed the deficit of -10.6 billion baht.
Fiscal Sector Indicators FY2014 FY2014 FY2015
Q1/ Q2/ Q3/ Q4/ Q1/ Q2/ 2MQ3/ Apr May YTD
FY14 FY14 FY14 FY14 FY15 FY15 FY15
Net Government Revenue
(net of local authorities’ allocation) 2,074.7 503.5 437.2 608.5 525.5 507.4 469.9 393.4 168.6 224.8 1,370.8
(%y-o-y) -4.0 -1.0 -6.9 -5.2 -3.0 0.8 7.5 -5.2 23.6 -19.3 1.1
Expenditure 2,460.0 831.1 553.0 514.7 561.2 844.1 617.6 368.2 191.5 176.8 1,830.0
(%y-o-y) 2.4 5.7 -5.6 6.8 2.2 1.6 11.7 5.2 -2.2 14.6 5.5
Budget Balance -384.3 -334.7 -115.9 105.6 -39.4 -347.3 -138.9 -55.3 -44.6 -10.6 -541.5
4.Exports in May 2015 contracted consecutively for 5 months. The export values in May 2015 was amounted at 18.4 billion USD or contracted by -5.0 percent per year. The contraction was caused by the slowdown global economy including Thailand's major trade partners. Thus, there was a slowdown purchasing power in the world market. The export goods showing a contraction comprised of electronics, electrical appliances, vehicles, agro-industry, and minerals and fuel which decrease by -1.9, -5.1, -1.0, -11.7 and -20.6 percent per year, respectively. However, the export goods showing an expansion comprised of agricultural products which expanded by 5.9 percent per year. The export markets showing a contraction in May 2015 comprised of Japan, Eurozone, Africa, and ASEAN-9, which declined by -4.1, -13.7, -26.9 and -12.2 percent per year, respectively. The export markets showing an expansion were USA, China, and ASEAN-4, which increased by 0.4, 3.3, and 2.5 percent per year, respectively. Meanwhile, the import values was amounted at 16.0 billion USD, or contracted by -20.0 percent per year. As such, the greater export value compared to that of imports resulted in a trade balance in May 2015 to be surplus of 2.4 billion USD.
Major Exports Market 2014 2014 2015 (Exports Share 2013>>>2014) Q1 Q2 Q3 Q4 Q1 2M/Q2 Apr May YTD Exports to the world (%yoy) -0.4 -1.4 0.0 -1.8 1.6 -4.7 -3.5 -1.7 -5.0 -4.2 %qoq_SA / %mom_SA -1.0 -0.8 -0.4 3.8 -6.2 - 2.7 -3.9 - 1.China (11.9%>>>11.0%) -7.9 -4.5 -4.2 -6.3 -15.3 -14.4 2.3 1.1 3.3 -8.2 2.U.S.A. (10.0%>>>10.5%) 4.1 0.6 4.9 3.4 7.2 5.6 4.1 8.4 0.4 5.0 3.Japan (9.7%>>>9.6%) -1.9 0.7 -6.4 -1.0 -0.6 -9.2 -3.6 -3.0 -4.1 -7.1 4.Eurozone (8.8%>>>9.2%) 4.7 4.8 10.9 2.0 1.7 -3.9 -9.1 -3.5 -13.7 -6.0 5.Malaysia (5.7%>>>5.6%) -1.9 -0.1 -1.4 -5.0 -1.0 -14.6 -18.6 -24.6 -12.7 -16.3 6.Hong Kong (5.8%>>>5.5%) -4.4 -1.8 1.7 -13.5 -1.8 -11.5 -1.3 4.0 -6.0 -8.0 PS.ASEAN-9 (26.0%>>>26.1%) 0.2 -5.4 -0.1 1.1 5.2 -2.4 -6.7 -6.1 -7.2 -4.2 PS.ASEAN-5 (17.6%>>>17.0%) -3.9 -11.0 -4.1 -4.2 4.3 -9.4 -11.9 -11.6 -12.2 -10.5 PS.ASEAN-4 (8.3%>>>9.1%) 9.0 7.0 8.8 13.6 6.8 10.6 3.0 3.5 2.5 7.4
5. Supply-side indicators showed that the tourism sector expanded highly and this was the importantly supporting factor for the Thai economy expansion. The number of inbound tourists in May 2015 was recorded at 2.31 million persons, which expanded by 38.2 percent per year or expanded by 6.5 m-o-m SA. This expansion was supported by the short-distance tourists from China and Malaysia. This reflected the strong growth in tourism sector. Agricultural sector as reflected by Agricultural Production Index (API)in May 2015 contracted by -7.3 percent per year but expanded by 0.7 m-o-m SA due to the decreasing in paddy, rubber, oil palm, and corn for animal feed. Particularly, the paddy production contracted highly since the beginning of the year due to drought. In addition the water level in dam was low and had to ask for the cooperation from farmers to delay planting rice. Moreover, the delivery of irrigation water has been stopped for out-of-season rice cultivation. However, crops that use less water and tolerance to drought such as sugar cane and cassava continued to expand. Meanwhile, the production in livestock and fishery continued to increase. Likewise, the agricultural prices in May 2015 showed the 16th consecutive month of contraction by decreasing -5.1 percent per year. This was due to the unrecovered prices of world rubber and the declining in oil prices. In addition, the prices in livestock and fishery contracted by -8.2 and -15.9 percent per year, respectively. Manufacturing Production Index (MPI) in May 2015 will be announced formally by the Ministry of Industry on 30 th June 2015. Thai Industries Sentiment Index (TISI) in May 2015 stood at 85.4 points decreasing for 5 months consecutively. This decline was due to the anxiety of the recovery of global economy and drought that affected purchasing power of domestic consumers particularly for agricultural sector. In addition, there were competitive condition and increasing costs plus Thai economy and drought, which affected the consumption and spending in agriculture. In addition, EU acted on Thailand's illegal fishing by issuing yellow card resulting in the threat on the exports of fishery products, and canned and processed seafood.
Supply Side Indicators 2014 2014 2015
Q1 Q2 Q3 Q4 Q1 2M/Q2 Apr May YTD
Agricultural Production Index (%yoy) 0.6 1.1 6.5 2.7 -4.4 -5.0 -9.6 -12.1 -7.3 -6.7
%qoq_SA / %mom_SA 3.3 -6.7 0.3 -1.0 1.2 - 0.0 0.7 -
Manufacturing Production -4.6 -7.0 -4.8 -3.9 -2.3 -3.4 -5.3 -5.3 -
Index (%yoy) (Preliminary)
%qoq_SA / %mom_SA -3.6 -1.9 -3.7 2.7 -1.2 - -1.1 - -
Thai Industries Sentiment 87.4 85.8 85.8 88.2 90.0 89.6 85.8 86.2 85.4 87.9
Index (TISI) (percent)
Number of Inbound Tourists (%yoy) -6.7 -9.0 -15.9 -10.1 7.0 23.1 27.5 18.3 38.2 24.7
%qoq_SA / %mom_SA -10.3 -2.7 7.8 13.4 4.3 - 1.9 6.5 -
*Preliminary
6. Internal stability remained desirable and external stability remained robust. Headline inflation in May 2015 decreased by -1.3 percent per year and this was the 5 th consecutive month of contraction due to the low-level prices of energy and the reduction of fuel tariff (FT) rate for electricity charges during May - August 2015. Meanwhile, Core inflation stood at 0.9 percent per year. Unemployment rate (preliminary) in May 2015 was 0.9 percent of total labor force, or equivalent to 354,000 unemployed persons. Public debt GDP ratio at the end of April 2015 stood at 43.5 percent, still below the Fiscal Sustainability Framework, which was targeted at 60.0 percent. Likewise, external economic stability remained robust and resilient to the risk from volatilities in the global economy , as indicated by the high-level of international reserves at the end of May 2015 at 158.5 billion USD, or approximately 2.9 times of short-term external debt .
Macroeconomic Stability 2014 2014 2015
Indicators Q1 Q2 Q3 Q4 Q1 2M/Q2 Apr May YTD
Internal Stability
Headline Inflation (%yoy) 1.9 2.0 2.2 2.0 1.1 -0.5 -1.2 -1.0 -1.3 -0.8
Core Inflation (%yoy) 1.6 1.2 1.7 1.8 1.7 1.5 1.0 1.0 0.9 1.3
Unemployment rate 0.8 0.9 1. 0.8 0.6 0.9 0.9 0.9 0.9* 0.9
(% of total labor force)
Public debt (% of GDP) 42.8 42.9 43.4 43.5 42.8 43.3 43.5 43.5 n.a. 43.5
External Stability
Current Account Balance 14.2 8.2 -0.4 -0.5 9.8 8.2 1.1 1.1 n.a. 9.4
(Billion USD)
International Reserves 157.1 167.5 168.2 161.6 157.1 156.3 158.5 161.1 158.5 158.5
(Billion USD)
Net Forward (Billion USD) 23.1 23.6 23.7 24.7 23.1 19.7 19.1 18.5 19.1 19.1
International reserves to short 2.7 2.8 2.7 2.7 2.7 2.9 2.9 2.9 - 2.9
term external debt (times)
Source: Fiscal Policy Office / www.fpo.go.th