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Covid-19 resurgence, weak labour market, threats to economic recovery – Bank of Thailand

Maya Taylor

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Covid-19 resurgence, weak labour market, threats to economic recovery – Bank of Thailand | The Thaiger
PHOTO: Andreas Brücker on Unsplash
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A director at the Bank of Thailand’s economic and policy department says the resurgence in Covid-19, coupled with a fragile labour market, poses a threat to the country’s economic recovery. Chayawadee Chai-Anant says the reintroduction of strict lockdowns in many other countries also poses a risk. She says the full impact will depend on the rate of new infections in the Kingdom and the government’s response to the resurgence.

According to a Bangkok Post report, while Chayawadee does not expect a double-dip recession (a recession, followed by a short period of recovery, followed by another recession), she admits a rise in Covid-19 infections could affect the economy in the first part of the year, particularly with the labour market remaining fragile.

“The labour market is an important driver of Thailand’s economic recovery and our labour market has considerable elasticity.”

Unemployment figures dropped slightly last month, to 2%, having been at 2.1% in October. There were 810,190 people reported as unemployed in October, which decreased to 783,760 last month. While the overall economy showed some signs of improvement in November, the decimated tourism sector is still crippled by the lack of international visitors.

Meanwhile, Amonthep Chawla from CIMB Thai Bank, says a rise in Covid-19 cases in the Kingdom will have an impact on consumer confidence, affecting revenue in the food and services sectors. Although this may not lead to higher unemployment, it could see the introduction of reduced working hours, thereby affecting private consumption and Thailand’s rate of economic growth next year.

SOURCE: Bangkok Post

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5 Comments

5 Comments

  1. Avatar

    Patrick Nouvel

    Thursday, December 31, 2020 at 10:30 am

    Joke !! Only official figures in hospitality sector without counting side undeclared self employed is over 6 million. Most facilities in tourists areas closed or working on 5 to 15% occupation, hence labor under short part time with 70 to 80% jobless

    • Avatar

      Issan John

      Thursday, December 31, 2020 at 1:17 pm

      The total workforce in Thailand is 38 million, so you’re saying that 1 in 6 of Thailand’s working population is unemployed because of the loss of foreign tourism.

      Absolute nonsense.

  2. Avatar

    Ben

    Thursday, December 31, 2020 at 9:57 pm

    In a year COVID will be in the rear view mirror. The biggest long-term threat to the economy is the rising baht which is now under 30 to the USD. Sectors including manufacturing, tourism and trade will be negatively affected.

    Why don’t they print a ton of baht and help those left unemployed by COVID? It’ll keep the baht from going lower, help consumer spending and be very popular politically.

    • Avatar

      indisPC

      Friday, January 1, 2021 at 11:09 am

      If they cared about unemployed Thais, why are they still bringing in migrant workers from Myanmar, a country with an on-going CV outbreak?

      I think the writing is on the wall: they don’t care.

  3. Avatar

    Toby Andrews

    Friday, January 1, 2021 at 11:10 am

    There are so many self employed in Thailand it is hard to count how many are unemployed now.
    For instance motor cycle taxis drivers, those shy and sensitive cuddly fellows whose few joys in life is to scatter pedestrians on the pavement and run traffic lights..
    Who took down the official trip prices that they had to display so as not to confuse the tourists in Pattaya. They were in Thai anyway so the tourist could not read them.
    Most will now be reduced to using a basic Nokia, and have had to pawn their top of the range smartphones.
    Alas they may have to return to manual labour and suffer the indignity of working on
    building site with the Burmese! The building site where employment figures are secret, to protect the illegal workers!! There, the shy and sensitive taxi drives will be reduced to labour.
    I have to stop now I am becoming too emotional . . .

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Economy

BTS skytrain maximum fare rate increasing to 158 baht despite backlash

The Thaiger

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BTS skytrain maximum fare rate increasing to 158 baht despite backlash | The Thaiger

Bangkok’s BTS skytrain maximum fare rate is being raised to 158 baht despite receiving backlash over the hike. The Transport Ministry is behind the calls for City Hall to stop the increase as it says it is too expensive for the average commuter who takes the BTS 2 times a day. Saksayam Chidchob, the Transport Minister, says other routes should be explored before increasing the costs for commuters.

“The Bangkok Metropolitan Administration should halt its policy on new BTS maximum fare and wait for other authorities to find proper solutions.”

The BMA and Transport Ministry were jointly appointed to set the fare’s ceiling in 2018, but it appears the BMA is now taking control of the new price hike. The BMA and Interior Ministry were previously responsible for granting concessions for the skytrain’s operation but the Transport Ministry is also part of the reviewing committee for extending the concessions and overall investments in the country’s mass transit system.

But deals are being made by the BMA that appear to ignore the Transport Ministry’s equal role in making decisions and the ministry says such actions are breaching co-investment laws. It isn’t the first time the BMA has made decisions without the Transport Ministry’s joint approval.

Before the new hike in fares, it previously extended concessions to the current Bangkok Mass Transit System in order to keep the fare ceiling at 65 baht. Now, making a new deal that would see passengers paying more than double in total fares across the skytrain system is being seen as pushing the envelope.

What is not clear is why the fares are being hiked when the country is suffering economically due to the Covid-19 pandemic. Even though the new maximum is set to rollout on February 16, Bangkok’s governor has offered to bring the new maximum down to 104 for a short period of time in consideration of the recent Covid outbreak.

But even increasing the fare to 104 baht is being widely opposed. The secretary-general of the Association for the Protection of the Thai Constitution says even the discounted rate is too expensive for daily commuters. And, the date for the discount ending has not been announced.

SOURCE: Bangkok Post

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Economy

Government considering another registration round for co-payment scheme

Maya Taylor

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Government considering another registration round for co-payment scheme | The Thaiger
PHOTO: Thai PBS World

The Finance Ministery is considering adding another registration round to the Khon La Khrueng (“Let’s Go Halves”) co-payment scheme, as 1.34 million rights have not yet been taken up. The government introduced the scheme last October, in an effort to stimulate the Covid-battered economy. Under the scheme, Thai citizens get a 50% subsidy on the purchase of food, drink and general products, up to 150 baht per person per day, to a maximum of 3,000 baht for the duration of the scheme. Those who sign up need to make purchases within 14 days of their registration.

The first phase got under way on October 23 and finished on December 31, with the government setting aside 30 billion baht to cover 10 million people. The second phase began on January 1 and runs until March 31, covering an additional 5 million people. The cap has also been raised from 3,000 to 3,500 baht.

Kulaya Tantitemit from the Fiscal Policy Office says that of the combined 15 million rights, 13.66 have been taken up. The Bangkok Post reports that those who have not received subsidy rights can register for the 1.34 million that remain by the end of this month.

The Finance Ministry is also considering a third phase of the scheme, based on the success of the first 2 phases, according to Minister Arkhom Termpittayapaisith.

SOURCE: Bangkok Post

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Economy

Thailand’s rich not eligible for 3,500 baht government handout

Maya Taylor

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Thailand’s rich not eligible for 3,500 baht government handout | The Thaiger
PHOTO: Chiang Rai Times

Thailand’s Finance Ministry has confirmed that wealthy citizens are not eligible for the government’s monthly cash handout of 3,500 baht. The Rao Chana (“We Win”) scheme consists of 2 monthly payments of 3,500 baht for those struggling with the financial fallout of the Covid-19 pandemic. Those with savings above a certain, unspecified threshold, will not qualify.

The ministry has not specified what this figure might be, in a bid to stop people transferring funds out of their accounts in order to fall below the required threshold. The Rao Chana scheme is aimed at farmers and the self-employed and is similar to the previous Rao Mai Thing Kan (“We Won’t Leave Anyone Behind”) scheme. That scheme consisted of 3 monthly payments of 5,000 baht and also excluded those with savings above a certain amount.

“The government spent 390 billion baht (on Rao Mai Thing Kan), but people still protested in front of the ministry after their applications to receive 5,000 baht remedial payments were rejected. A government official found that 1 protester had more than 10 million baht in his account, which is why he was not eligible.”

Kulaya Tantitemit from the Fiscal Policy Office, says screening under the new scheme will also reject government officials, employees in state enterprises, and people already in the social security net. The eligibility criteria are expected to be submitted for Cabinet approval soon, with registration for the scheme opening at the end of January and first payments made in early February.

“We want to help low-income people affected by Covid-19, so those outside the social security system such as freelancers or farmers will be eligible. But anyone with a high income will be disqualified.”

SOURCE: Nation Thailand

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