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August 28, 2007
Election campaigns seen stimulating economy

The general election scheduled to be held late this year will help stimulate the country's economic growth since up to 30 to 40 billion baht will be injected into the economy in the leadup to the poll, according to the University of Thai Chamber of Commerce (UTCC).

UTCC Economic and Business Forecasting Center director Thanawat Phonvichai said the regional economy in the second half of 2007 will continue to slow down due to the appreciation of the baht, continuing political instability, and a lack of confidence among consumers and entrepreneurs.

The sluggishness is expected to persist through the third quarter of the year.

Dr. Thanawat said the regional economy, particularly in the North, still slowed down because exports and consumption failed to recover although incomes earned in the agricultural sectors continued to increase thanks to hefty farm product prices and the government's acceleration of budget disbursements.

In the Northeast, the economy continued to be sluggish since farm outputs such as rice, cassava, and maize had been supplied to the market in smaller amounts despite the commodity price hike.

In the Central Region, the economy still signaled a slowdown, particularly in the industrial sector affected by the stronger baht, higher oil prices, and increased production costs of entrepreneurs.

Likewise in the South where the value of regional agricultural output, especially natural rubber, had declined, and tourism was not active because of insurgency and it not being the high season.

In Bangkok and its environs, a slowdown was seen in the tourism, service and industrial sectors. Consumption and investment had declined due to political uncertainties, hefty oil prices and the appreciation of the baht.

However, a survey on opinions of fiscal officials in provinces around the country showed many believed the economy would slightly recover in the fourth quarter of this year and fully pick up in the first quarter of next year.

So, the center had raised its projection of the economic growth to 4.1 per cent from 3.8 per cent estimated earlier.

Dr. Thanawat said the general election set to be held on December 23 would not only receive state budget support of some Bt1.9 billion, but also draw an expected large amount of some Bt30 to 40 billion for the anticipated election campaigns. TNA reports

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