Analysts see different levels of economic damage caused by floods
Economic damage caused by this year’s flooding could be as high as 200 billion baht in worst-case scenario
Analysts with different institutes are predicting different levels of economic damage caused by the flooding in several parts of Thailand this year, ranging from 27 billion to 200 billion baht.
CIMB Thai Bank is forecasting the highest level, believing that the floods could cost the Thai economy up to 200 billion baht, as well as put a dent in GDP, pushing it down by between 0.1% and 0.3%.
“The flooding this year is damaging, but less so than the Great Flood of 2011,” CIMB deputy managing director Amonthep Chawla said.
“We believe the situation will resolve in 1-3 months from now, depending on weather conditions,” he said. “Despite the impact being limited to certain areas of key industries namely tourism, manufacturing and agriculture, the damages could be as high as 200 billion baht.”
He advised the government to prepare debt management measures to curb household debts that are expected to soar after the flood, adding that the handout scheme might not help solve the problem.
Krungsri Research, meanwhile, predicted that in the best-case scenario, the Thai economy would suffer 33 billion baht of damage from the flooding, which would affect some 6.2 million rai, and cause a reduction in projected GDP of 0.19%.
In the standard scenario, the flood is expected to affect some 8.6 million rai and cause 46.5 billion baht of economic damage, or 0.27% of the GDP.
The centre said that in the worst case, the flooding could affect up to 11 million rai, causing 59 billion baht of damage to the economy, and bringing the projected GDP down by 0.34%.
Krungsri Research said the worst case has a 30% chance of happening.
Lastly, the Federation of Thai Industries (FTI) predicted that the flooding in Northern Thailand would impact the economy by as much as 27 billion baht.
FIT chairman Kriengkrai Thiennukul said that the flooding has been the most severe that the region has experienced in the past 80 years.
He said the estimated damage is calculated from the devastation of agricultural areas and orchards by floods and heavy rains.
He added that 60 FTI members in Chiang Rai have been affected by the floods, including damage to factories, machines, cars and office equipment.
Kriengkrai added that the federation has prepared urgent measures to rehabilitate business for its members who were directly or passively affected by the flooding.
