Official : the “R” word has been said… Recession

After months of denial… the ugly face of reality is coming back with a vengeance.

A thai minister has pronounced the infamous “R” word… For the first time !

We can’t blame him : the clowns in the US (Bush, Bernanke, Paulson) spent one freaking year to deny that the US were in recession. Elections were of course more important. Back luck. They lost the elections. And the country was indeed in recession !

The US entered a recession in December 2007, according to the National Bureau of Economic Research (NBER). Although a private sector body, the NBER has been dating the business cycle since 1929. (BBC)

So back to Thailand.

Thailand’s economy in 2009 may suffer a negative growth and up to 1.2 million people could be unemployed, if the political turmoil and the closure of airports prolong, Deputy Prime Minister and economy czar Olarn Chaipravat said on Monday.

According to the deputy premier, the present crisis is worse than the economic recession in 1997. (Bangkok Post)

Thank you Minister. I bet you’re a regular reader of ThaiCrisis. 😉

However, the Minister is wrong : the airport closure is of course not the cause of the problem. It’s a mere symptom.

Even with 20 airports, the thai exports would go down. And even 20 airports couldn’t change the ugly GDP report we had on Q3 (read here).

So cut the crap. And fasten your seat belt (if we can still fly)… 😉

2 Responses to “Official : the “R” word has been said… Recession”

  1. 1 Jason 2 December 2008 at 5:41 am

    Its truly bizzare what is happening right now and sadly things are going a lot worse than anticipated… people and businesses are frightened that the standoff will be violent and that could break the country really into half… resembling a social or a true civil unrest!!!!

    This article from the Thai media shows that the damage is already here!!!!! no need to wait for 2009

    Alarming decline in recruitment amongst political unrest.

    JOBSEARCH, Thailand’s only vertical search engine indexing major Thai job offers on the internet has registered an alarming decline in job postings in the last week. According to Mr. Farouk Mogheth, Managing Director, this is attributed to the global economical slowdown however the last numbers are connected mainly to the serious political unrest and panic amongst the business sector. “Jobsearch is a very good barometer for the general attitudes towards hiring” said Mr. Mogheth as its is an automatic listing indexing around 175 000 – 200 000 jobs on a daily basis and is updated every 15 minutes. The system monitors other job websites and HR pages of individual companies and lists all their job openings on a single page for a concise overview.

    He mentioned, that the during the last system check there has been a remarkable 58% drop in companies advertising job vacancies (job posting insertions) compared to the same period last month. The numbers as well show a steady rise of at least 42% in the activity of jobseekers subscribing for added job alerts.

    “Our system contains hundreds of thousands of registered jobseekers and we can agree that the activity has been a clear indication of a wave of layoffs and downsizing in almost all sectors raising nervousness amongst workers and forcing them to seek alternatives and sort of looking for a plan B” he added. The most hit are the travel and hospitality sectors as well as logistics and heavy industry. Most companies have a definite freeze on their recruitment for this year and the outcome on the 1Q in 1009 is not at all optimistic as businesses are very cautious. The only thing that companies now are concerned about is lowering costs and see where to save. “This is the input of many HR specialists in Thailand” said Mr. Mogheth whose company recruits mid and top managers for the biggest names in the industry through Start Recruitment.

    In case the current political standoff continues, then the economical outlook in 2009 will be more grim on the Thai economy as a whole. Unemployment rates will rise faster than the labour market’s ability to absorb the numbers of jobseekers as well as fresh graduates thus creating a major strain on the government and its resources. At the moment there is no creation of new job vacancies, on the contrary many investors has put Thailand on the hold until there is a clear indication that the situation has calmed down and that there will be a viable government to continue with reforms and steps to attract foreign direct investment.

  2. 2 Insanity 2 December 2008 at 7:20 am

    Very soon a Thai Minister will be able to use the “D” word also…DEPRESSION

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Thailand Crisis

Coup, Economic slowdown, Terror In the South... The situation is worsening in Thailand. Bumpy road like often before.

But this time, it's different.

The key to understand the present turmoil is the inevitable... succession of King Bhumibol.

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