Thai services index rises on second-half forecast

Kalin Sarasin, chairman of TCC and Board of Trade of Thailand, said that the Thai services index was introduced following the models of industrialised nations, such as the United States and Singapore, where services indicators have been used to evaluate performance of the industry.
More than 70 per cent of these countries' gross domestic product (GDP) are contributed by the service sector. About 50-55 per cent of Thailand's GDP came from services and are expected to rise to 70 per cent in the future, Kalin said.
“The service sector now plays a major role, given the technological assistance and reduction of workforce. In the future, workforce may have to shift to the service sector. This index will be evaluated every month to measure the industry's growth,” he said.
Saowanee Thairungroj, president of the University of Thai Chamber of Commerce (UTCC), said the services index in June rose to 51.1 from 50.2 in the previous month and the indicator is forecast to move up to 51.5 in the next six months, reflecting the Thai economic recovery which could come from not only export but also services.
The index was conducted on 10 services including financial institutions, tourism, hotels, restaurants, properties and transportation, amounting to per cent of sector. sector.
By service, the financial institution and bank services index topped the list with the index figure of 56.1, followed by the hotel and restaurant services at 53.9, transportation services at 52.7 and tourism services at 50.3. The property services index stayed at 49.3 below the threshold.
“The index compositions by service extend from the numbers of current and future service records, orders/reservation, monthly hire, the overall business, compensation for services. We found that all of the service segments remain at satisfactory level. Only property group has not yet made a recovery," Saowanee said.
Thanavath Phonvichai, director of UTCC's Centre for Business and Economic Forecasting, expressed confidence on tourism to drive the Thai economy this year, next year and in the next five years, saying that when infrastructure is improved, tourism will grow continuously.
Confidence of Chinese tourists are expected to be restored with fast travel plans after the recent tragedy in Phuket which is expected to have short-term on Thailand, he said.
UTCC's Consumer Confidence Index, based on a survey of private enterprises and businessmen by region, increased to 48.4 in June from 47.7 in the previous month due to the government's economic stimulus measures, baht depreciation, rises in some crop prices and border trade expansion, he said.