EVIDENCE OF CONTINUED RECOVERY

       Thailand's economic recovery continues, with a rebound in domestic consumption, private investment and exports convincing official the economic contraction will be limited to only 3 per cent this year.
       As a sign of recovering domestic demand and export markets, the Federation of Thai Industries, Automotive Industry Club yesterday also revealed vehicle output exceeded 100,000 units last month for the first time in a year. The 103,000 units produced were down 16 per cent year on year but up 22 per month on month.
       Last month's automobile exports were also the highest in a year at 49,500 units, down 33 per cent year on year but up 14 per cent month on month. Their combined value of Bt23.8 billion was down 30 per cent year on year.
       Finance Ministry spokesman Ekniti Nitithanprapas said gross domestic product was expected to show a drop of 3.5-4 per cent in the third quarter, against declines of 7.1 per cent and 4.9 per cent in the previous two quarters.
       Several indicators predicted a smaller contraction - value-added tax, commercial-lorry sales, imports of capital goods and consumer procucts and exports, all of which revealed a rebound in domestic consumption, new investment and a recovery in exports. Export value is also expected to drop only 17.7 per cent year on year in the third quarter, to US$41.1 billion (Bt1.37 trillion), against a 23.5-per-cent decline in the first half, due to recovery in emerging markets like China and Vietnam.
       "These figures are in line with Standard & Poor's estimates that despite huge public debts, the economic recovery continues. But S&P is concerned about policy continuity, particularly in the medium term," Ekniti said.
       "If the red shirts resume meeting in late November and political tensions flare back up, it could slow further recovery in domestic consumption and investment and affect the continuity of government measures."