Stimulus to boost consumer confidence: UTCC
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Despite retreating in September for the first time in five months, consumer confidence is expected to forge ahead this month after the military-led government recently launched a clear-cut economic stimulus package for the final quarter, according to the
“Consumer confidence in the fourth quarter should go back to increasing in October, thanks to the stimulus package to inject about Bt360 billion into the economy. Farmers will also get about Bt40 billion as a measure to raise their incomes,” Thanavath Phonvichai, director of the university’s Economic and Business Forecasting Centre, said yesterday.
The slip in the Consumer Confidence Index echoed dismal prospects for the domestic and global economies this year.
The headline index dropped slightly from 80.1 points in August to 79.2 points last month, while other indices related to confidence also slumped as consumers showed weak faith in continuing economic growth. The baseline is 100, with scores below that indicating low confidence.
The low prices of farm commodities, particularly for rice and rubber, have weighed heavily on the consumer mood, as has the slow rebound in the export and tourism sectors.
The lacklustre recovery of the global economy and economic problems in many countries, including Russia and China, which has been hit by the current turmoil in Hong Kong, have also clouded the outlook for expansion.
If the economic stimulus package can be quickly implemented this quarter, the economy could grow by nearly 2 per cent for the whole year, but if it is delayed, growth may only run at 1.5-1.7 per cent, Thanavath believes.
To ensure consumer confidence swings back up, the government should accelerate state spending and payments to farmers, as the rice price will dip during the harvest season starting late this month, he added.
However, with politics stabilised by the military’s overthrow of the elected government, the university believes consumer sentiment will continue to improve into next year.
Wachira Kuntaweethep, assistant director of the centre, said that based on the university’s survey with 2,252 respondents, confidence in employment opportunities dropped from 73.6 points to 72.9 last month, while confidence in future income stumbled from 96.4 to 95.5.
Confidence to purchase a new car or house or to invest and travel also faltered, reflecting reluctance to spend money amid the unclear economic signs.
To boost border trade, the Board of Trade of Thailand and the Thai Chamber of Commerce will organise a meeting on the Thai-Myanmar Joint Special Economic Zone and a seminar to solve border-trade problems from October 14-15 in Tak.
Somsak Kaveerat, chairman of the Tak Chamber of Commerce, said border trade with Myanmar was expected to surge under closer economic cooperation in Asean.
Cross-border trade with Myanmar reached Bt43 billion last year.
Kalin Sarasin, secretary-general of the Board of Trade of Thailand and the Thai Chamber of Commerce, said more than 50 Thai and Myanmar companies would join this event.
Besides the seminar, the Thai Chamber in cooperation with the Union of Myanmar Federation of Chambers of Commerce and Industry will also stage the “Thai-Myanmar Trade Fair” at the Otop Centre in Mae Sot. It is projected to draw 20,000 traders and businesspeople.
