special report
‘National Bank-Private Bank’ joins the analysis Risk factors for Thai economy after covid
Despite the COVID-19 epidemic situation in Thailand will start to get better But from the point of view of economists – finance Where will the Thai economy go? And what risk factors are there to worry about?
Mr. Setthaput Suthiwatanaruput Governor of the Bank of Thailand (BOT) said that over the past 40 years, the Thai economic structure remains the same, reliant on exports in the sector. The old economy was automobiles, petroleum and petrochemicals, electronics. and tourism
while the context of the world has changed completely The engine of Thailand’s economy may not be as strong as before.
“It can be seen from exports. Currently, Vietnam has overtaken Thailand. In the past 5 years, the growth rate is 6 times higher than Thailand, and last year exported more than Thailand 50 billion dollars. 60% of Thai industrial exports are still in the old world industry.”
Mr. Setthaput said and said As for foreign direct investment (FDI), Vietnam has also surpassed Thailand since 2014. Over the past five years, Vietnam’s FDI has been nearly twice as high as Thailand, as a result of Thailand’s less attractiveness than its competitors. in the region both in terms of cost and labor quality, demographic structure entering an aging society including commercial benefits
As for the tourism sector, it is likely that it will take a long time for the number of foreign tourists to return to the same level. With the 40 million people before the covids because of the behavior of tourists after covids will focus on health and hygiene popular with small groups as well as to use technology to increase comfort
Most recently, the World Economic Forum’s Thailand Environmental Tourism Competitiveness Ranking ranked 130th out of 140.
reflecting the clear impact of traditional tourism patterns in the past
“If these economic engines are not accelerated We may see the Thai economy growing at a slower rate. And if looking at the next 10-20 years, the number of Thai workers will fall to 1% per year if we do not adjust in terms of labor efficiency to increase.”
Thailand is well equipped with highly accumulated cultural capital and high diversity, including food, tourist attractions. and arts and crafts which can be further to add value and economic value Some stories may be based on foreign experiences.
The overall picture must be adjusted to be in line with the new trends in a timely manner. In which in the future there will be at least 2 currents:
1. Digital stream to change the lives of the people and business operations entirely
and 2.sustainability especially the environment that results faster and stronger than expected including the impact of various policies of developed countries to alleviate global warming problems The government sector has to allow more market mechanisms to work on their own. To create an ecosystem that supports and drives the business sector to adapt. and strong economic growth This is a role that other sectors cannot.
with two parts, the first part flag or set clear policy directions so that businesses can see the same picture and plan to adapt and has a supporting mechanism, part two Accelerate the laying of foundations to support businesses and people such as adjusting the rules Accelerating the upgrading of key infrastructure such as transportation and education systems to be in line with the adjustment of the business sector
Including accelerating the expansion of international trade and investment policies, such as FTA, to increase Thailand’s attractiveness to multinational corporations (MNCs) and to expand our export markets.
side Mr. Don Nakornthap Senior Director of Financial Stability Bank of Thailand think that the Thai economy has passed its lowest point Despite the outbreak of the new coronavirus if not very severe It’s likely to pass.
However, the economic recovery has just begun. Still not very stable due to uncertainty coupled with the vulnerability from accelerating inflation. from energy prices and agricultural products, but it is believed to be temporary Finally, inflation will return to a low level.
Therefore, the Bank of Thailand is expected to maintain interest rates until the end of 2022 and at that time believe that the overall economy will return to the same level as before the outbreak of the coronavirus. which is considered that Thailand takes quite longer than other countries to restore the economy to pre-COVID levels
“The part of the labor market which has been severely affected by the coronavirus outbreak. causing unemployment in the social security system and the unemployment rate that remains at a high level Consequently, Thai household debt remained at a high level. It is still a drag on the Thai economy next year.”
while the Thai business sector will not recover equally or recover ‘K’ Export-related businesses will recover well, or the top K, while tourism, services and real estate remain in the bottom K.
from the fragility of the economy with high uncertainty While the financial status of businesses and households is still not good, the BOT views that under this situation, economic stimulus measures should be taken to boost the Thai economy.
for example, the reduction of interest rates only in certain industrial sectors such as real estate sector This is a key sector for the Thai economy, including 10% of GDP and employs approximately 3 million people overall.
Private part by Mr. Thanawat Phonwichai President of the University of the Thai Chamber of Commerce and Chairman of the Advisory Center for Economic and Business Forecasting University of the Thai Chamber of Commerce said that the Thai economy began to recover. This was reflected in the Consumer Confidence Index rising for the second consecutive month from Sept-Oct.
as well as the foreign business confidence index. Modern Trade Sentiment Index as a result of the loosening of lockdown measures, opening the country, organizing economic activities and Thailand can control the spread of infection continually including faster vaccination
However, the meeting with the Chairman of the Regional Chamber of Commerce And conducting an online opinion survey of 350 samples found that most of the respondents still believe that the Thai economy is not recovering. and should begin to recover from the second quarter of 2022 onwards
pointed out that the macroeconomic picture has recovered see results in big business but has not reached the regional level. Although the country is open, it only opens the blue area in 4 provinces, while SMEs still have no access to business opportunities.
As for next year, the main problem of the Thai economy is Household debt situation next year is likely to increase. In 2022, household debt is expected to be 94.1 percent of GDP, up from this year’s forecast of 92.6% of GDP.
The challenging issues of the Thai economy are
1. The state must control the epidemic and accelerate the distribution of vaccines to meet the goals. Because if the infection in the country is reduced, it will build confidence for both people, business people and tourists.
2. No lockdown measures However, measures may be taken to limit certain problematic activities.
3. Pushing the business sector to resume normal activities Especially the night business should be open next year.
4. Provide soft lone to enhance liquidity for SMEs.
5. Stimulate the purchasing power of the public sector to create employment and reduce household debt problems In particular, the project should be increased by an additional 3,000 baht per person, half of each project, resulting in 90 billion baht in the economy.
and 6. Enhancing the economy in the EEC area to become active to attract foreign investment
It’s all about analyzing the various risk factors. that the Thai economy must face in the near future Of course, stakeholders must consider preventive measures, corrective and countermeasures to be most effective.
