THE approval of the draft constitution and the additional question at Sunday’s nationwide referendum will have a positive impact on the stock market and investment in financial markets but not to a significant level, Dr Anusorn Tamajai, Rangsit University’s vice president for research and academic service said yesterday.
The Thai bourse would only move up in the short term because the P/E ratio (price-earning ratio) of both the market and a lot of stocks with good fundamentals has already risen high.
There should not be any significant change to the real economy, Dr Anusorn said, however warning that exports would either expand very little or continue to shrink.
While the manufacturing sector and private investment could rise a little, tourism industry will be performing better than expected.
“Consumption and consumer confidence should improve a little bit on expectation of elections next year. For this reason we stand by our projected 3.2 to 3.5% economic growth for this year.”
However Dr Anusorn pointed out that while both the draft charter and the additional question were approved, the voter turnout was quite low and for this reason all parties involved should study the result and work out why this came through.
“They should try to understand both those who voted yes and those who voted no in order to delve into the public’s intentions.
“Doing so will enable them to lead this country toward justice and a strong and better quality democracy than in the past.”
When it comes the referendum’s medium to long term impact on this country and its economy, this depends on how open the drafting of 10 organic laws will be both in terms of strategy and the level of participation of all parties involved.
“Also how sincere are they in pushing the reform of important issues in the country, if it is wide open and a democratic atmosphere is created … this will be positive for the economy, private investment as well as exports.”
Meanwhile the Thai Chamber of Commerce University said today that the Thai economy should expand by 3.3% this year which is higher than its previous projection of 3%.
Exports are likely to shrink by 2.1% this year while inflation should be in the range of 0.4%, Thanawat Pholwichai, the university’s director of its center of economic and business forecasting said.
Factors helping the economy in the second half include a more stable political atmosphere after the charter referendum as well as the government’s measures to spur the economy starting to improve consumption and private investment while tourism and border trade should expand steadily, he added.
CAPTIONS:
TOP: Officials show a ballot box minutes before the charter referendum got underway on Sunday. Photo: tnews.teenee.com
INSET: Dr Anusorn urges all parties to study the referendum result.
By Thai Residents reporters
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