The overall Thai economy since 2007 has improved significantly with support from both domestic demand and private investment, despite the unstable political situation and the external risk due to possibility of global economic slowdown.

The Fiscal Policy Office has projected GDP for 2008 at 5.6% (announced on 27 March 08), accelerating from the previous year growth of 4.8% due mainly to expansion in private investment and the improvement of the fiscal policies. Some of these are directly favorable to the property industry, such as the cancellation of the 30-percent reserve of foreign-capital investments, the tax incentives, especially tax reductions on property transfer and specific business tax, and the approval of mass transit projects.

Meanwhile, the impact of unstable political situation and global economic slowdown is the major concern of the growth in the remaining of this year. Other concerns include the sub-prime loan crisis in the US , the impact of rising oil prices and inflation. This already affects the Thai economy, which was shown at the inflation rate of 5.0% in 1Q 08 compare to inflation 2.3% rate last year.

The real estate market has also improved signification with the better economy, esp. with the helps from the tax stimulation package by the government, including the issue of the 1-year tax reductions on property transactions. The effects from these policies will stimulate to property-demand growth, and has direct positive impact on developer's bottom line. Nevertheless , the risk of higher construction and land cost, and high competition will remains. We see the trend of the aggressive competition of new design, the improvement of construction method and the improvement on brand & corporate images.

We expect the property market will improve in 2008 due to the depletion of the existing stocks and stronger demand. Although we have seen the weak market in 2007, which has the new registration units of 74,221 decreased from 78,116 units in 2006. It is noteworthy to notice the higher market show of the big player, which is reflected in better financial statement.

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