Thailand's confidence outlook upgraded to 'stable' from 'negative'
Japan Credit Rating Agency (JCR) has maintained Thailand's Foreign Currency Long-Term Issuer Rating and Local Currency Long-Term Issuer Rating at A- and A respectively and changed the country's confidence outlook from "Negative" to "Stable" as of Apri
The rating agency explained that the upgrading of Thailand’s confidence rating to A+ was mainly due to the country’s improved political stability, stable financial structure, ongoing reform efforts, attractiveness as a tourist destination and the supply chain of higher technological products such as automobile and electrical appliances in the Kingdom.
Limited recovery
JCR believes the Thai economy will have a| limited recovery this year from the slowdown in exports and the high level of household debt.
The country’s trade account surplus expanded in 2014 as a result of a slowdown in imports caused by the sluggish local economy but trade account and current account surpluses in 2015 are expected to be minimal amid the economic recovery. Meanwhile, foreign direct investment stood at a high level of US$11.8 billion last year despite a drop from the previous year.
Thailand’s international reserves (excluding gold) decreased to US$151.3 billion in 2014 from the rise in net outflow of funds for investment in securities during the year.
The country’s international reserves reached its peak at US$173.3 billion as at the end of 2012 and the current amount of international reserves is still 2.6 times higher than the country’s short-term debt.
The level of non-performing loans of commercial banks has also decreased and currently represents only 2.2 per cent of the entire loan amount in the system.
