Economic warning as troops clash

Downturn predicted if border deteriorates

- NAREERAT WIRIYAPONG PHUSADEE ARUNMAS

A protester waves the national flag outside the Cambodian Embassy in demonstration against Cambodia.

(VARUTH HIRUNYATHEB)

Economists have warned of severe damage if the Thailand-Cambodia border conflict resumes, noting exports, tourism and the labour market could feel the pinch as consumption is hit.

Exchanges of gunfire were reported by both countries on Wednesday, with officials indicating there were injured and dead civilians.

Poonyawat Sreesing, senior economist at Siam Commercial Bank Economic Intelligence Center (EIC), said around 130 billion baht worth of Thai exports to Cambodia, or 1% of the country's total shipments next year, could be erased if the border tension is prolonged.

During the third quarter, Thai exports to Cambodia contracted by 43% year-on-year, with border trade down nearly 100%, as most shipments were by air or sea, said Mr Poonyawat.

"The labour and tourism sectors could be affected if border tensions escalate again after troops from both sides exchanged fire in the disputed area," he told the Bangkok Post.