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Thailand: An economic primer
February 2013
Santitarn Sathirathai, Vice President
+65 6212 5675
ANALYST CERTIFICATIONS AND IMPORTANT DISCLOSURES ARE IN THE DISCLOSURE APPENDIX. FOR OTHER IMPORTANT
DISCLOSURES, PLEASE REFER TO https://firesearchdisclosure.credit-suisse.com.
CREDIT SUISSE SECURITIES RESEARCH & ANALYTICS BEYOND INFORMATION
Client-Driven Solutions, Insights, and Access
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Basic facts and figures
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Development indicators
Source: IMF, World Bank, UNDP, CEIC
Nominal GDP (2011)
USD 346 bn
World Rank 30
NJA Rank 6
GDP per Capita (2011)
Nominal USD 5306.5 World Rank 91 NJA Rank 7
PPP basis USD 9700 World Rank 88 NJA Rank 6
Literacy Rate
94.1%
United Nations Development Programme Report 2011
Public spending on education as % of GDP 3.75% (2010)
Life expectancy 73.6 yrs World Rank 83
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Demographics
Source: IMF, World Bank, UNDP, CEIC
Population
69.5 mn (2011)
World Rank 20
NJA Rank 5
Median Age 34.2 (2011) 5th youngest population in NJA
Dependency Ratio 41.7% of Working Age Population
Dependency Ratio, old 12.6% of Working Age Population
Dependency Ratio: Age dependency ratio is the ratio of dependents people younger than 15 or older than 64 to the working-agepopulation those aged 15-64. Data are shown as the proportion of dependents per 100 working-age population.
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Income distribution
Source: IMF, World Bank, UNDP, CEIC
Urbanization
34.1 % (2011)
World Rank 169
NJA Rank 9
Gini Co-efficient (2004) 42
Gini co-efficient: Gini index measures the extent to which the distribution of income or consumption expenditure among individuals or households within aneconomy deviates from a perfectly equal distribution. A Gini index of 0 represents perfect equality, while an index of 100 implies perfect inequality.
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GDP structure
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GDP by expenditure and output (2011)
Source: Credit Suisse, CEIC
Components (Real GDP) Share (%)
Private Consumption/GDP 52.0
GFCF/GDP 21.5
Government Consm/GDP 10.1
Exports/GDP 75.5
Imports/GDP 59.7
Net Exports/GDP 15.8
Components (Real GDP) Share (%)
Agriculture 8.6
Mining and Quarrying 2.2
Manufacturing 39.0
Utilities 3.6
Construction 2.1
Services 44.6
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Private consumption and investment shares (real basis)
Source: Credit Suisse, CEIC
50.0%
51.0%
52.0%
53.0%
54.0%
55.0%
56.0%
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 201118.0%
19.0%
20.0%
21.0%
22.0%
23.0%
24.0%
25.0%
Private Consumption / GDP GFCF / GDP (RHS)
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Industrial production and real GDP
Source: Credit Suisse, CEIC
-10
-5
0
5
10
15
-40
-30
-20
-10
0
10
20
30
40
Mar-01
Sep-01
Mar-02
Sep-02
Mar-03
Sep-03
Mar-04
Sep-04
Mar-05
Sep-05
Mar-06
Sep-06
Mar-07
Sep-07
Mar-08
Sep-08
Mar-09
Sep-09
Mar-10
Sep-10
Mar-11
Sep-11
Mar-12
Sep-12
Industrial Production y/y % Real GDP y/y % (RHS)
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Trade structure
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Exports by destination (% total) (2011)
Source: Credit Suisse, CEIC
ASEAN24%
China12%
EU11%Japan
11%
USA10%
Hong Kong7%
Middle East5%
Australia4%
Others16%
Exports regionwise as % of Total Exports
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Exports by product (% total) (2011)
Source: Credit Suisse, CEIC
Agricultural and FisheryProducts
12%
Electronics14%
Electrical Appliances5%
Automotive
12%
Other Manufacturing53%
Others4%
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Imports by destination (% total) (2011)
Source: Credit Suisse, CEIC
Japan18%
ASEAN16%
China13%Middle East
13%
EU8%
USA6%
Korea4%
Switzerland4%
Australia4%
Others14%
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Imports by product (% total) (2011)
Source: Credit Suisse, CEIC
Consumer Goods: NonDurable (ND)
5%Consumer Goods: Durable
3%
Crude Oil14%
Non-Agro Raw Materials andIntermediate Goods
35%
Machinery and Equipment(ME)17%
Automotive4%
Others22%
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Net trade position of selected commodities (2011)
Source: Credit Suisse, CEIC
Commodity Net Exports as % of GDP
Oil -9.1
Gas -1.4
Coal -0.4
Rice 1.9
Corn 0.0
Wheat -0.1
Soy -0.3
Rubber 3.8Palm 0.1
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Real effective exchange rate
70
80
90
100
110
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
REER: BIS: 2010=100
Source: Credit Suisse, CEIC
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External accounts (1)
Source: Credit Suisse, CEIC
Indicators Values for 2011
Merchandise Trade Balance / GDP 6.8
Service Trade Balance / GDP -2.9
Transfer / GDP 3.1
Current Account / GDP 3.4
Net FDI / GDP -0.7
Forex Reserves (Nov12) (USD bn.) 181.6
External Debt/Reserves (as on Oct12) 71.1
Import Coverage (Latest) (in months) 8.8
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External accounts (2)
Source: Credit Suisse, CEIC
Current Account/GDP Net FDI/GDP ForexReserves
% % USD bn.2002 3.7 2.5 33.12003 3.3 3.2 39.02004 1.7 3.6 42.22005 -4.3 4.3 49.92006 1.1 4.1 52.12007 6.3 3.4 67.02008 0.7 1.6 87.82009 8.4 0.3 111.12010 4.1 1.4 138.52011 3.4 -0.7 172.2
2012 (F) 0.5 0.3 185.0
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Inflation basket
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CPI breakdown
Source: Credit Suisse, CEIC
Categories Weights (%)
Core Inflation 59.1
Food (including food away from home) 31.0
Fuel 9.9
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Headline and core inflation trend (qtrly)
Source: Credit Suisse, CEIC
-6
-4
-2
0
2
4
6
8
10
Jan-00
Jul-00
Jan-01
Jul-01
Jan-02
Jul-02
Jan-03
Jul-03
Jan-04
Jul-04
Jan-05
Jul-05
Jan-06
Jul-06
Jan-07
Jul-07
Jan-08
Jul-08
Jan-09
Jul-09
Jan-10
Jul-10
Jan-11
Jul-11
Jan-12
Jul-12
Jan-13
%
Core CPI
Headline CPI
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Key subsidized products
Source: Credit Suisse, CEIC
Total Subsidies 2011 THB 80.7 bn
Subsidies to public corporations
THB 79.7 bn
Subsidies to private corporations THB 0.9 bn
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Interventions in the rice market: Rice mortgage scheme
Source: S. Shigetomi, K. Kubo, and K. Tsukada (2011). The World Food Crisis and the Strategies of Asian Rice Exporters, IDE-JETRO
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Fiscal and Monetary policy conduct
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Fiscal policy
Source: Credit Suisse, CEIC
Indicators Values for 2011(in %)
Government Revenue / GDP 18.0Government Expenditure / GDP 20.7
Fiscal Balance / GDP
-2.7
General Government Debt / GDP 42.3
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Fiscal balance
Source: Credit Suisse, CEIC
Fiscal Balance / GDP
-7.0
-6.0
-5.0
-4.0
-3.0
-2.0
-1.0
0.0
1.0
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
%
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Monetary policy operation
Source: Credit Suisse, CEIC
Seven-member Monetary Policy Committee
three from inside thecentral bank, four ex-policy makers/bankers/academics
Vote at each meeting and the votes are revealed
BOT governor appointed through independent selection committeeand can only be removed with the cabinet approval
Hawkish inclination sometimes causes rifts with the Ministry of Finance
In the decisions since 2006, the Bloomberg consensus got thedecision wrong 16% of the time and 60% of those were hawkishsurprises (hike when expected to hold)
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Monetary Policy: Core inflation target
Source: Credit Suisse, CEIC
Core inflation target 0.5-3%
1-day repo rate as the tool (neverchange reserve ratio)
FX intervention to curb volatility inthe Thai baht
-2
-1
0
1
2
3
4
5
6
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
Core CPI (% yoy)
Policy rate (%)CS forecast
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Financial sector
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Key ratios
Source: Credit Suisse, CEIC
Indicators Values for 2005 Values for 2011
% %
Domestic Credit by Banking Sector / GDP 119.2 123.0
Domestic Credit to Private Sector / GDP 100.7 104.6
Market Cap of listed companies / GDP 70.8 77.7
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Doing business/competitiveness
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Global competitiveness ranking
33/117
28/125 28/131
34/13436/133
38/13939/142
38/144
0
5
10
15
20
25
30
35
40
45
2005 2006 2007 2008 2009 2010 2011 2012
Thailand
Data Label: Rank/Total Countries Surveyed
Source: WEF, Credit Suisse
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Ease of doing business ranking
20/155
18/175
15/178
13/181 12/183
16/18317/183
0
5
10
15
20
25
2006 2007 2008 2009 2010 2011 2012
Thailand
Data Label: Rank/Total Countries Surveyed
Source: World Bank, Credit Suisse
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Infrastructure quality ranking
29/134
40/133
35/139
42/142
46/144
0
5
10
15
20
25
30
35
40
45
50
2008 2009 2010 2011 2012
Thailand
Data Label: Rank/Total Countries Surveyed
Source: WEF, Credit Suisse
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Labor market
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Real GDP/workers (% y/y)
Source: Credit Suisse, CEIC
-5.0%
-3.0%
-1.0%
1.0%
3.0%
5.0%
7.0%
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
THB
Real GDP / workers (% y/y)
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Unemployment and wages
Source: Credit Suisse, CEIC
Average Monthly Nominal Wage Unemployment RateTHB %
2001 6,663.2 3.32002 6,611.0 2.42003 6,758.5 2.22004 6,915.1 2.12005 7,389.4 1.92006 7,850.6 1.52007 8,085.1 1.42008 8,912.7 1.42009 8,694.2 1.52010 9,262.2 1.12011 10,004.5 0.7
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Disclosure AppendixAnalyst Certification
I, Santitarn Sathirathai, certify that (1) the views expressed in this report accurately reflect my personal views about all of the subject companies and securities and (2) no part of my compensation was, is or will be directly or indirectly related to the specific recommendations or views expre ssed in
this report.
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