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No quick rebound this time, as clouds gather over Thai economy

Published on Feb 18, 2014 6:27 AM

BANGKOK (REUTERS) - Any comfort investors in Thailand draw from what happened four years ago, when economic growth, the stock market and foreign investment all surged despite deadly unrest in Bangkok, may be sorely misplaced.

The latest bout of political strife will delay major government spending projects, and damage a lucrative tourism industry. And, even if Thailand's politics calm down, its economy will remain handicapped by weak private investment and rising household debt.

"If you look at the channels through which politics impacts real economic activity, it's virtually every demand side component of GDP," said Nomura senior economist Euben Paracuelles. "But, where I have a bigger worry is on private consumption and private investment."

Data released on Monday, Feb 17, 2014, showed the economy slowed sharply in the fourth quarter of 2013, when street protests aimed at bringing down Prime Minister Yingluck Shinawatra's Puea Thai Party government first began.

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