Global economic and political uncertainties together will be major threats to the Thai economic growth this year, according to a top banker in the Thai capital, official news agency MCOT reported.
Speaking at a seminar on "Economic Challenge in 2011," Bangkok Bank Chairman of the Board of Executive Directors Kosit Panpiemras said all parties must brace for possible risks from global financial volatility, higher product prices, rising interest rates, currency exchange fluctuations, and political unrest.
In particular, they needed to prepare for stiff competition in trade and investment as China had enjoyed robust economic growth and expanded its trade and investment worldwide.
Kosit said the Thai economy had continued to expand satisfactorily in all aspects, both with exports and for domestic consumption.
It is expected the economy will grow 4-5 percent and the policy interest rate would edge up the normal level at 2.75-3 percent this year.
He said that loans extended by the bank should not experience problems this year since domestic investment and trade continued to expand.
Should the gross domestic product (GDP) expand 4-5 percent, it is projected that lending would grow 5-7 percent.
The BBL chief forecast the escalating violence in protests in Libya would fuel the global oil price hike, but he believed that impacts of substantial fuel prices would be limited and there would be no domino effect.
He conceded that higher agricultural product and commodity prices would still pose a risk to living costs, but it is expected the prices would drop if natural disasters ease because the farm output would be back to normal.