People across the country celebrated the 70th year of his accession to the throne this year. During his reign he worked on a lot of successful projects, including improving the living conditions of his subjects, especially those in the remote rural areas, with more than 3,000 development projects initiated by the King and implemented throughout the country.
We cannot deny that his Majesty the King is one of the major reasons Thailand has been able to develop more successfully than other countries.
Last month, the author had a chance to make an academic presentation about infrastructure topics in Shenzhen, China. I had not been to China for many years, and I found that this city had grown very fast. Actually, Shenzhen was one of the fastest-growing cities in the world during the 1990s and 2000s.
Starting from a small fishing town – Shenzhen is located on the southern tip of the Chinese mainland and on the east bank of the Pearl River, neighbouring Hong Kong – it has grown into a modern metropolis.
It became China’s first special economic zone in 1980. The city now is the high-tech and manufacturing hub of southern China, and home to the world’s third-busiest container port and the fourth-busiest airport on the Chinese mainland.
In the meantime, another part of the world with a very influential economy, the United States, just elected a new president, Donald Trump. His campaign reminded me of the old days in 2004, when I was finishing up my PhD in the US. There was a famous TV show called “The Apprentice” that judged the business skills of a group of contestants. Episodes ended with the host eliminating the poorest contributor from the competition, with the words “You’re fired.” And, yes, this was spoken by Trump.
On that show, businesspeople would vie for the show’s prize, a one-year US$250,000 starting contract to run one of Donald Trump’s companies.
I feel that he is a very talented world-class businessman. However, in the reality of national policy, I doubt that being president will be the same as running his own company.
It may not be the same as saying “You’re fired.”
One of the policies he has advertised, international trade protectionism, might not be the first best idea, as all economists around the world, and from real experience, like Shenzhen’s for example, know that trade creates more prosperity, more specialisation and more efficient use of the world’s resources. One country can consume products that it cannot produce itself and can export the commodities of which it has an excess.
I admit that some trade theorists have backed away from the assumption of constant returns, and some argue that using protectionist measures to build up a huge industrial base in certain industries will then allow those sectors to dominate the world market.
Nevertheless, when one country wants to protect trade too much, for sure, its trading partners can do the same. The world is working on making trade fairer, but overly strict protectionism may not be a good idea in this regard.
One thing I can expect is that this will not be an easy road for the new president, especially when the US is well known as one of the world’s largest consumers of all products from across the world, and is the land of the melting pot.

Apirada Chinprateep PhD is assistant professor at the School of Development Economics, National Institute of Development Administration.

Private consumption perked up 3.5 per cent year-on-year on the back of a 7.9-per-cent revival in vehicle purchases, while service exports jumped 14.7 per cent on the uptrend in foreign-tourist arrivals.
Year on year, merchandise exports showed growth of 0.4 per cent, but public-sector consumption in the quarter contracted 5.8 per cent on declines in expenses after strong state budget disbursements in the previous period, which saw a 1.5-per-cent rise, the EIC said.
Public investment expanded by 6.3 per cent, compared with 11.9 per cent in the second quarter, as fewer stimulus measures were in play.
Private investment shrank 0.5 per cent year on year, reflecting sluggish investment for manufacturing.
Construction of manufacturing plants fell 24.2 per cent, while investment in machinery dropped 0.5 per cent, reflecting still-weak private-sector confidence in the economy, the centre said.
Nalin Chutchotitham, an economist at HSBC’s Bangkok branch, said third-quarter GDP growth came in slightly below the market’s consensus forecast but above its expectation of 3.2 per cent year on year.
Gross domestic product grew 0.6 per cent quarter on quarter, a tad below second-quarter growth.
Exports of both goods and services contributed more to overall GDP growth in the third quarter, offsetting the lower contribution from domestic demand, which decelerated.
Private consumption and public investment remained key drivers of growth, in contrast to flattish private investment.
Growth appears to be on a steadier path now that the government has managed to get its infrastructure projects moving, although downside risks remain from global economic uncertainties and weakness in Thailand’s household income growth.
HSBC expects no more policy-rate cuts in the foreseeable future.
The NESDB reaffirmed its outlook for 2016 growth at 3.2 per cent, down from the prior 3.0-3.5 per cent, and expects 2017 growth to run at 3-4 per cent, supported by an improvement in exports, which HSBC projects at 2.4 per cent and continued growth of total consumption and public investment.
More public infrastructure projects have been approved and have progressed to the tendering process in recent months, especially for motorways, mass-transit systems and railways.
However, higher debt among households and small businesses is likely to remain a drag on domestic demand.
HSBC expects GDP growth to remain at a moderate pace in 2017 from the current forecast of 2.8 per cent before accelerating slightly in 2018.
With inflationary pressures limited, the Bank of Thailand will most probably maintain its policy interest rate at 1.5 per cent for the foreseeable future, it said.

Former president of Taiwan Mah Ying-jeou said: “We have been waiting for 13 years. Please do not let us wait for another 13 years to achieve our dream.”
At the World Chinese Economic Summit, Ma, in delivering his speech entitled “The Prospects for Closer Relations between Taiwan and the Asean Economies”, he urged Asean to implement non-exclusion of regional trade agreement.
He said trade should be profit-oriented. A non-exclusion trade agreement would benefit all parties.
He said Asean regional trade agreements, such as free trade agreements, have initiated exclusion policies under the requirements of World Trade Organisation. Under political and diplomatic factors, Taiwan has encountered various obstacles.
“We are unable to participate |in all the main regional trade |agreements,” he said.
Ma added: “I sincerely hope all Southeast Asia counties can support the move of including Taiwan into your free trade agreements, including the Trans-Pacific Partnership agreement, the Regional Comprehensive Economic Partnership and the Asia Pacific Free Trade Agreement. These collaboration would for sure benefit all people.
Taiwan is capable of playing a very important role in supply chain. We are also very advance in new technologies.”
He said when he was attending the East Asian Economic Forum organised by the World Economic Forum in Singapore, in his capacity as Taipei mayor in 2003, he gave a speech that touched on collaborations and integration with Asean economies and Taiwan’s wish to join.
During Ma’s eight years as Taiwan president, the country signed free trade agreements with China, Singapore and New Zealand.

The key groups with sharp quarter-on-quarter drops in net profit include construction materials, construction, residential development (as a result of seasonal effects and government-stimulus impacts), and energy.
Those with year-on-year and quarter-on-quarter increases in 3Q16 included food, banks and non-bank financial institutions, retail, hospital, and electronic parts.
The listed companies’ combined net profit for the first nine months of 2016 was Bt672 billion, up 40 per cent year on year, given a low base last year. The figure accounts for 76.2 per cent of this year’s net-profit estimate.
After 3Q16 earnings announcements, we revised our net-profit estimates by 2.63 and 1.06 per cent respectively for this year and next. The revision came mostly from PTT, which has seen better-than-expected profit from its gas-separation plants. This year, there are also more positive extraordinary items. We expect this year’s profit to total Bt883 billion or Bt92.52 a share and next year’s Bt950 billion or Bt99.54 a share.
Based on the market earning yield gap of 4.75 per cent, equivalent to PER (price-to-earning ratio) of 16 times, the SET Index target is 1,481 points this year and 1,595-1,600 points next year with expected return of about 6.7 per cent from now to the end of next year.
We still weigh on construction stocks because of positive financial flows from tenders for a number of the government’s large projects. After the tenders, construction will start, and that will result in positive developments for construction firms, which will realise income according each project’s progress.
Stock picks: CK (Ch Karnchang, fair value Bt37.50), a big construction company all set for the tenders; UNIQ (Unique Engineering and Construction, FV@Bt25), on expectation for consistent, positive development of profitability and a chance for upcoming tenders; and SYNTEC (Syntec Construction, FV@Bt4.90).
The poultry-export business is also interesting. Recently, South Korea permitted imports of chicken meat from 12 plants in Thailand and will permit 18 more next year. Stock pick: GFPT (FV@Bt19).

Prakit Sirivattanaket
Vice President
Kasikorn Securities

It’s certain that US interest rates will rise after Federal Reserve chairwoman Janet Yellen’s November 17 statement confirming that the policy rate will increase if US economic figures remain close to their targets, with the next increases on a gradual basis.
Yellen recommended stimulus through production capability rather than fiscal policy, while insisting she would not resign before the end of her term in 2018. She reiterated that the Fed must stay independent for its policy implementations without any political interference, and opposed the abolition of Dodd-Frank legislation. Obviously, the Fed’s direction remains the same, while some of it contradicts President-elect Donald Trump’s stated policies. We will follow whether or not the Fed can resist pressure from the new administration and Congress.
In regard to a US rate rise in December, Fed fund futures surged to 96 per cent. The money markets responded instantly, with the US Dollar Index surpassing 100 to a 13-year high of 101.06.
The Japanese yen weakened to a seven-month low of 110.24 per dollar. The Thai currency depreciated to 35.44 per dollar.
It’s the same for the bond markets. US 10-year bond yield soared to a 2016 high of 2.302 per cent and pulled up bond yields around the world. This is positive for BLA (Bangkok Life Assurance), whose price is low at Bt55.5. Its targeted price is Bt60.
Capital may flow out of the Stock Exchange of Thailand as a result of pressure from the US dollar and baht and foreign investors will continue their positions as net sellers of Thai stocks.
Since September 23, foreign investors have sold a net Bt45 billion, or 30 per cent of their accumulated purchases in the purchase round. Foreign investors are forecast to sell Bt30 billion more (accumulated sell will rise to Bt75 billion or 50 per cent of the purchase round).
The estimated sales are expected to pressure the SET Index by 39 points and, as a result, the support line will be 1,435 points. This support line is attractive for long-term investment, given its expected PER (price-to-earning ratio) at 14 times based on next year’s estimated EPS (earnings per share) at Bt102.7 (about 1,437.8 points).
The SET Index is expected to take on a bearish mood in a range of 1,467-1,476 points. In the short term, speculate in MSCI and SET50 plays, KCE (KCE Electronics) and BJC (Berli Jucker), and wait to increase investment when the SET Index nears 1,438 points.
Focus on accumulation following the investment theme of stocks that gain from depreciation of the baht (KCE) and those gaining from the interest-rate uptrend (BLA).