UTCC:US-China trade war may lead to "cold economic war"

BANGKOK, May 10 (TNA) - The Center for Economic and Business Forecasting, under Bangkok-based University of the Thai Chamber of Commerce (UTCC), says that the escalating trade war between the United States and China currently may lead the world economy to the so-called "cold economic war" undesirably. The center's director, Thanawat Phonvichai, voiced the assessment in the city on Friday, when Washington's recent decision on imposing its increased import tariff of 25 per cent on 5,745 items of Chinese products, totally worth about 200 billion US dollars, from 10 per cent earlier, took effect. Thanawat reasoned that the escalating US-China trade war, expected to be dragged on for a certain period of time, should not only cause a global economic slowdown, but also result in attempts by both countries to rivally build up and accumulate their economic power. Thanawat cautioned that Asian economies should be major targets of the, possibly, expanding economic power by both the immense Chinese and the US economies. The senior Thai economist projected that the escalating US-China trade war should basically cause a drop in the global economic growth in 2019 to 2-2.5 per cent year-on-year on average, from about 3 per cent year-on-year, and in the Thai economic growth to less than 3.5 per cent year-on-year on average, from 3.7-3.8 per cent, due to a decline in part of Thai exports to the huge Chinese economy, in which an economic slowdown should also be observed. The senior economist told journalists that Thailand's exports of rubber, plastic pellets, fruits and computer sets to China are likely to be particularly affected by Beijing's escalating trade war with Washington. Besides, the escalating trade war between the United States and China are likely to have some negative impacts on the Thai tourism in terms of a drop in the number of Chinese tourist arrivals in the Thai Kingdom this year due to the anticipated economic slowdown in China. The wellknown Thai economist suggested that the newly-elected Thai government introduce more economic stimulus measures and speed up the implementation of mega-investment projects to boost the national economy, especially those in the country's Eastern Economic Corridor (EEC) Project, along with expanding Thai exports to growing neighboring economies in the ASEAN Economic Community (AEC), instead, and keeping the Thai baht stable. Meanwhile, Deputy Commerce Minister Chutima Bunyapraphasara said her ministry maintains its projection that Thailand's exports should not be in the red zone in 2019, though its slowdown anticipated, as there should be still rooms for expanding some Thai products in both the US and the Chinese economies, especially in specific US states and Chinese provinces, while there should also be positive prospect for Thai exports to the immense Indian market and the growing economies of neighboring Cambodia, Lao PDR, Myanmar and Vietnam in the AEC. The deputy commerce minister cited as examples that Thailand could ship more automobiles and parts, processed food and beverages, major farm products as polished rice, dry beans and rubber, frozen fresh fruits, clothes and gems and jewelry to the United States in substitution of the Chinese products, while, on the other hand, shipping more cosmotics, processed and frozen meat and fruits, as well as synthetic rubber products to China in substitution of the US products. According to the deputy commerce minister, the newly-elected Thai government should also accelerate negotiations and conclusion of more free trade agreements (FTA) with trading partners to expand the country's export markets. (TNA)