The report, which also gives a forward looking outlook for 2010, currently foresees full year economic expansion of between 7.0 and 7.5 percent, with exports and private consumption set to expand by 25.7 percent and 4.1 percent, respectively, and tourism and investment to grow at 4.7 percent and 9.2 percent, respectively. The report notes that in the second quarter “Export values in term of U.S. dollar surged by 41.8 percent…The key drivers included a 97.1 percent growth of vehicles, parts and accessories, a 43.5 percent growth of electrical appliances, a 37.2 percent growth of air conditioning machines, and a 236.6 percent growth of precious stones and jewellery.”

It should be recalled here that in July auto exports hit a 22-year high. In fact, the Federation of Thai Industries’ Automotive Industry Club is reported to be considering a revision to its full year forecast. That forecast already calls for a sales target of 1.5 million units, and about 890,000 units to be sold overseas.

Export growth is also seen in part to a consequence of the recovery of foreign demand as the global situation improves, as well as the implementation of the ASEAN Free Trade Area (AFTA). In terms of Thailand’s major markets, exports in Q2 were seen to increase in ASEAN by 45.3 percent. “Similarly, export to China, US, Japan and EU(15) experienced an expansion in export value of 30.7, 26.4, 34.6 and 24.1 percent respectively.” Looking to Thailand’s newer markets, growth was also observed in exports to Australia, South Korea, Taiwan and India, by 97.6, 41.7, 36.1 and 25.2 percent, respectively.

In terms of Thailand’s cross-border trade, in the first half of this year trade with neighboring countries expanded by 33 percent over that of the same period in 2009. According to the Department of Foreign Trade, for the frst half of the year Thailand’s border trade was valued at 388.6 billion baht, 243.6 of which involved exports. That is an increase of 49.3 percent. The department reported that “Malaysia accounted for 63.6 percent of Thailand’s border trade during the period, followed by Myanmar, 17.7 percent, Laos, 11.5 percent, and Cambodia, 7.2 percent.”

Among the key economic indicators, NESDB forecasts that headline infation will be between 3.0 percent and 3.5 percent; the unemployment rate will be 1.3 percent; and the current account surplus will be 4.9 percent of gross domestic product (GDP).

The increase in employment in the construction sector, which grew by 8.1 percent, together with a boost in farm income from the increase in prices of agricultural products, even as the agricultural sector contracted due to drought, and an improving consumer confdence, all bode well for continued expansion in household consumption expenditures. The rise in consumer confdence is credited to the implementation of the government stimulus package.

Looking ahead for the second half of 2010, the NESDB sees encouraging signs for continued economic expansion that include the contributing factors for frst half growth as well as an ease of political tension, supportive economic fundamentals that include fnancial liquidity, low real interest rates, and continued government measures. At the global level, economic and trade environments are seen to be supportive of Thailand’s growth, even though the major economies seem to be losing momentum, as intraregional trade and a broadened export market structure will offset any imbalance.

Likewise, the tourism sector, which had contracted by 3.6 percent in the second quarter, is expected to return to normal conditions in the second half of 2010. Improving political conditions will also support the recovery in consumer and investors confdence levels, which have already shown signs of improvement.

The NESDB also sees the government stimulus measures as reducing the impact of both reduced government expenditure in the regular fscal year 2010 budget, but also from any slowdown in the global economy.

With that in mind, NESDB forecasts that the Thai economy will grow over the full year within the range of 7.0 to 7.5 percent. The current account surplus for the full year will be 4.9 percent of the GDP.

Speaking at the 2010 annual meeting of the Offce of the National Economic and Social Development Board on the topic of the 11th Development Plan, Prime Minister Abhisit Vejjajiva cited human resources to be at the heart of the plan, which will be implemented from 2012 to 2016. With good infrastructure that is constantly getting better, with a commitment to research and development, and with improving human resources, Thailand is the place to invest.