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Political crisis worries private sector despite consistent rise in industrial confidence


The Thai Industrial confidence index in September improved for the fifth consecutive month, however a majority of business owners have expressed concern about the political situation.

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The index rose to 85.2 in September, increasing from 84.0 in August, Supan Mongkolsutee, chairman of the Federation of Thai Industries (FTI), said.
He said the survey results pointed to expanding domestic demand over the previous month after the government relaxed lockdown measures, helping economic activities in the country recover.
The recent economic stimulus and measures to help small and medium-sized entrepreneurs have helped improve domestic purchasing power. This is reflected by the index of orders, sales, production and turnover, which increased in both durable and non-durable products, Suphan said. Meanwhile, the export and shipping sectors showed positive signs after several countries eased Covid-19 control measures, causing trading partners to import more products from Thailand
According to a survey of 1,301 entrepreneurs covering 45 industry groups nationwide in September, it was found that 55.3 per cent of operators were concerned about the domestic political situation, 40.4 per cent about oil prices and interest rates, and 36.8 per cent about loans.
Factors alleviating the operators' concerns were the recovering world economy (65.7 per cent), the exchange rate (42.4 per cent -- mostly exporters).
The index forecast dropped to 93.3 from 94.5 in August. The drop was due to concerns about the second round of Covid-19, both domestic and abroad, especially the situation of the outbreak in neighbouring countries.
Many countries have enforced more lockdown measures. This will put pressure on the recovery of the Thai export sector in the future. Moreover, the end of the debt moratorium in October may affect the liquidity of businesses and the purchasing power in the country.
However, the issues that industrial sectors want the state to take are: accelerate budget disbursement through public investment projects, both central and regional, to help stimulate the economy; offer additional financial measures to help SMEs after the end of the debt moratorium in October; and, encourage government agencies to purchase and hire products from domestic entrepreneurs.

Published : October 19, 2020

By : The Nation