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Presented to Ms Jennifer Tan by: Chew Yu Heng Samuel 041737E Jasmine Ho Jie Min 044710M

MacroEconomics ICA 2 Country Analysis. Presented to Ms Jennifer Tan by: Chew Yu Heng Samuel 041737E Jasmine Ho Jie Min 044710M Lin Pei Jing 042881D Siti 041338Q. Australia. Thailand. Factors leading to our decision. Economic condition and structure in both country Balance of trade

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Presented to Ms Jennifer Tan by: Chew Yu Heng Samuel 041737E Jasmine Ho Jie Min 044710M

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  1. MacroEconomics ICA 2 Country Analysis Presented to Ms Jennifer Tan by: Chew Yu Heng Samuel 041737E Jasmine Ho Jie Min 044710M Lin Pei Jing 042881D Siti 041338Q

  2. Australia Thailand

  3. Factors leading to our decision • Economic condition and structure in both country • Balance of trade • Infrastructure of Australia and Thailand • Tax policy in Australia and Thailand • Comparison of interest rate between Australia and Thaliand. • Comparison of Thailand’s interest rate and inflation rate.

  4. Economic Structure • Real GDP • GDP per capita • Balance of Trade • Unemployment rate

  5. Comparison of real GDP The % change in real GDP for Australia has been after 1998 to 2001. On the other hand, the % change in real GDP for Thailand is since 1999 to 2001.

  6. Comparison of GDP per capita Australia GDP capita by US$ 7230 from 2001-2003 Thailand GDP capita by only US$ 402 from 2001-2003

  7. Limitations of GDP per capita • MeasurementErrors • Ignores Income Distribution • Exchange Rate Fluctuations • Purchasing Power

  8. Comparison of unemployment rate Thailand unemployment rate: from 1.5% in 1996 to 3.36% in 2001 Australia unemployment rate: from 8.2% in 1996 to 6.7% in 2001

  9. Balance of Trade Australia: Balance of Trade - deficit of US$ 7,657 million in 2002 and a of deficit US$ 18,260 million in 2003. Thailand: Balance of trade - surplus of US$ 3,436 million in 2002 and a surplus of US$ 10,866 million in 2003.

  10. Infrastructure and facilities • Telephone mainlines • Computers & Internet • Developments of the countries

  11. Australia - From 1995 to 2001, by 1.78% Thailand - From 1995 to 2001, by 55.86% Telephone mainlines (per 1000 people in the largest city)

  12. Australia From 1995 to 2001, users have from 500 ,000 to 7,200,000. ICT expenditure change is 36.77% Thailand From 1995-2001, users have from 55,000 to 3,536,000 Thailand’s % change have by 6 times than that of Australia’s users Thailand has developed its ICT and in ICT expenditure by 6.43% Thailand is developing its economy and uses IT vastly. Computers & Internet (users 1000)

  13. Australia 2005-06: Efforts to make rail freight more competitive. Extra funding provided to upgrade roads linking Melbourne, Sydney and Brisbane. Greater private-sector participation in infrastructure development will be encouraged. Thailand Expansionary policy Government expenditure of US$25 bn on health, education, irrigation and transport Focus of developing transport systems will be on Bangkok An investment budget of (US$12bn) for projects to expand the network from 44 km to around 290 km. Regional Developments

  14. Business Prospects • Fiscal Policy - Taxation of Australia and Thailand • Comparison of interest rate • Comparison of interest rate and core inflation rate of Thailand.

  15. Australia Personal Income tax raises to 47% cutting in at earnings of around US$50,000 per year Federal Govt collects a levy of 1.5% of personal taxable income 10% withholding tax on income flowing overseas are collected Thailand 25% in the personal income tax exemption (first Bt100,000 of taxable income) Lower tax rate on 1st Bt1m(US$25,000) in net profits on small businesses Companies sales under Bt 1.8m not be subjected to value-added tax Fiscal Policy - Taxation

  16. Interest Rate (%) 9 8 7 6 5 Thailand 4 Australia 3 2 1 0 4th 1st 1st 4th 4th 3rd 3rd 2nd 2nd Quarter Quarter Quarter Quarter Quarter Quarter Quarter Quarter Quarter 2002 2003 2004 Year Comparison of Interest Rate Thailand – Interest rate from 6.5% in 2002 to 5.5% in 2004. Australia – Interest rate from 7.6% in 2002 to 7.8% in 2004.

  17. Thailand Adapted from bank of Thailand

  18. Interest and Inflation Rate of Thailand • Inflation rate from 5.6% in 1995 to 7.2% in 1998 and to 0.9% in 1st Quarter of 2002. • Inflation rate cause cost of production to • Interest rate from 13.9% in 1995 to 15.4% in 1997 and to 7.0% in 1st Quarter of 2002. • Interest rate makes loans cheaper. Thus, Business can make more PROFITS!

  19. Conclusion Stay In ThaiLand! • Thailand’s economy is improving as there is a • Good balance of trade ( in surplus of US$ 7,430 million from 2002 to 2003) • Thailand’s infrastructure and facilities improving. • Better tax policy in Thailand. • Interest rate lower than Australia. • Inflation rate is low

  20. Q & A

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