The floods started at the end of July, but it is only in the past 2 weeks that the cost of the damage has increased exponentially with the flooding of Ayutthaya where some industrial estates have been affected. Now, Bangkok is preparing for floods in some areas later this week.
According to Thailand’s Commerce Minister Kittiratt Na-Ranong, “[t]his flooding is the worst in at least 50-60 years” (Bloomberg).
This statement is seemingly supported by one UN agency per Nirmal Ghosh in the Straits Times:
“Meteorologists have indicated that flooding in some of these countries is the worst in 50 years,” a bulletin from the United Nations Office for Coordination of Humanitarian Affairs (Unocha) said yesterday.
AP from yesterday:
Thailand is counting the multibillion dollar cost of nationwide flooding that has killed nearly 270 people and may yet cause more havoc as waters threaten to engulf the country’s capital.
Bank of Thailand Governor Prasarn Trairatvorakul said a preliminary estimate by the central bank shows economic losses from flooding that began in late July range from baht 60 billion to baht 80 billion ($1.9 billion to $2.6 billion).
That figure doesn’t include damages to assets or reconstruction costs and is expected to rise as the flood waters surge toward Bangkok, a city of about 10 million people. Some of its outlying areas are already under water.
Prime Minister Yingluck Shinawatra and Bangkok officials pleaded Tuesday with the city’s residents not to panic as workers raced to complete three critical flood walls with only one or two days to go before the already swollen river that winds through the capital bursts its banks.
Supermarket shelves have been cleared by shoppers of basic items like rice, bottled water, pork and chicken. Flood damage to agricultural land in the country’s north is expected to push up food prices, rice in particular.
The disaster is a further blow to Thailand’s electronics and auto industries, which have only just recovered from the production disruptions caused by the March 11 tsunami in Japan that knocked out suppliers of critical components. The dive in Thailand’s auto production caused the economy to shrink in the second quarter.
The flooding is the worst to hit the Southeast Asian nation in decades. About 8.2 million people in 60 of Thailand’s 77 provinces have been affected by floods and mudslides, and 30 provinces are currently inundated. Prolonged monsoon flooding, typhoons and storms have killed hundreds of people across Southeast Asia, China, Japan and South Asia in the last four months.
Moody’s Analytics economist Fred Gibson said economic losses from the flooding could be compounded if it spreads to the eastern seaboard province of Rayong where two thirds of Thai industry is located.
Honda Motor Co. said its Thai vehicle production has been suspended after two industrial estates in the historic capital of Ayutthaya, north of Bangkok, were inundated. Local media reported that hundreds of new Honda cars were submerged.
Damage to the Saharattananakorn industrial zone in Ayutthaya was estimated by the central bank at baht 25 billion to baht 30 billion.
Officials at the Agriculture Ministry said 2.9 million acres (1.17 million hectares) of rice fields might be damaged. Thailand, the world’s biggest rice exporter, has about 27 million acres planted with the staple grain.
Reuters has a story on the humantarian disaster:
Bangkok, much of which is only two metres (78 inches) above sea level, has seen only minor flooding but officials are preparing for worse this week and considering evacuation plans for some sections of the city of about 12 million people.
First Army Region Commander Lieutenant General Udomdej Sritabutr said three evacuation centres had been set up to support 7,000 evacuees in Ayutthaya province. At least 2,000 rescue workers have been sent to the area with nearly 1,000 boats and 155 trucks.
Ayutthaya provincial hall has been turned into a makeshift evacuation centre, packed with thousands in tents.
Bloomberg’s summary of the situation with focus on economic damages with Toyota temporarily shutting down production due to the lack of parts.
Floodwaters have swept across 60 of Thailand’s 77 provinces over the past two months, killing at least 281 people and swamping factories operated by Nidec Corp,. Honda Motor Co. and Canon Inc. The finance ministry this week cut its forecast for economic growth to 3.7 percent from 4 percent and said the disaster may cost 120 billion baht ($3.9 billion).
BP: Other Japanese companies are also affected – see this Bloomberg article – but economic assessment of damage continues to increase each day. Then again, as one Reuters article notes “[e]conomists are cutting forecasts for economic growth this year because of the floods but say reconstruction work will push up demand eventually, especially early next year”.
Tourism has largely been unaffected up until now per Reuters:
Despite the disruption to road and rail travel to the north, Tourism Minister Chumphol Silpa-archa played down the impact as he headed into a cabinet meeting on Tuesday.
“At least 39,000 foreign travellers are still coming to Thailand every day. They’re choosing to visit other areas and travel by air,” he told reporters.
To protect Bangkok’s Suvarnabhumi airport, the main international gateway into Thailand, a three-metre (9.8 ft) high earth dike was being reinforced.
BP: Then again, you always have to wonder whether it was a good idea to build the airport on a swamp although at least they have a plan in place….
While in recent days many countries have updated travel advisories that mention the flooding – see UK, Australia etc – and urge travelers to check information about the area they are going to, BP hasn’t seen from reading half a dozen of them any warnings advising not to travel to Thailand.
Will have some other posts as time permits on the political implications of the floods.