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Somkid outlines a bright future for Thai economy

Thaiger

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PHOTO: Somkid looks to a future and doesn't even mention tourism - The Thaiger
    • Thailand is poised to soar in the global market with heightened investment attraction and a massive budget earmarked to rejuvenate the economy in the fourth quarter, as the Covid-19 pandemic eases, according to Deputy Prime Minister Somkid Jatusripitak.
    • Mr Somkid says the government also plans to enhance financial cooperation with China and Hong Kong that will lead to business expansion in CLMV countries (Cambodia, Laos, Myanmar and Vietnam).
    • Mr Somkid said the country needs to solve economic woes caused by the Covid-19 crisis and prepare the country for the post-pandemic recovery.
    • The direction lies with sustaining the economy so it can progress through the invocation of executive decrees initiated by the Finance Ministry and the Bank of Thailand.
    • One decree sponsored by the Finance Ministry involves the procurement of a one-trillion-baht loan to pay for public health defences against the pandemic and relief money to aid people who have been hit by the crisis.

    “Thailand is poised to soar in the global market with heightened investment attraction and a massive budget earmarked to rejuvenate the economy in the fourth quarter, as the Covid-19 pandemic eases.”

    Enthusiasm from Deputy Thai PM and finance tzar Somkid Jatusripitak speaking to Bangkok Post.

    Mr Somkid believes the government also plans to enhance financial cooperation with China and Hong Kong that will lead to business expansion in neighbours Cambodia, Laos, Myanmar and Vietnam.

    Mr Somkid said the country needs to solve economic woes caused by the Covid-19 crisis and prepare the country for the post-pandemic recovery.

    “Some economic sectors, such as exports, will not contribute much to the economy this year.”

    He has directed the Budget Bureau to find an additional fund of 200 billion baht to help the economy.The fund may also be utilised as a financial buffer, especially if there’s a resurgence of Covid-19 or when other funds for sustaining the economy fall short in the medium term into next year, when the public health problem is expected to subside.

    “The 200-billion-baht fund is set aside from the current fiscal year budget. Of this, 80 billion baht is expected to be obtained for use starting next month.”

  •  

    But he admitted the investments may not be of significant help to the economy in 2020 because the “entire world is experiencing a downturn due to Covid-19”.

  • Mr Somkid also maintains that Thailand has caught the attention of several countries looking to relocate their production in the wake of the pandemic, including China, Taiwan, Hong Kong and Japan. He says they are attracted by potential investments in food production, farm product processing and medical equipment manufacturing.

    “Criteria has been recently tweaked to allow foreign investment projects valued at 100 million baht or less to be approved by an investment negotiation panel without having to be submitted to the BoI board. This will bring in more overseas investments.”

  •  

    Finally, the Finance Minister says the Stock Exchange of Thailand will kick off financial service cooperation previously reached with Hong Kong and the Chinese city of Shenzhen…

  • “…with the joint listings on course to being clinched so shares can be traded in Thailand or in Cambodia, Laos, Myanmar and Vietnam, which are countries with robust growth of between 5-6% annually.
  • SOURCE: Bangkok Post

 

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2 Comments

2 Comments

  1. Avatar

    Kevin Martyn

    Friday, June 19, 2020 at 10:03 am

    Come on the story about Thailands economy is someone really looking at Thailand wearing “rose coloured glasses”.

    I am sure many of the countries surrounding Thailand will fix their issues firstly before ever considering the severe economic financial Thailands Government put itself in. Not a thing to do with “Covid 19”

    I’m 100% positive Thailands economy will take at least a decade to show any signs of a recovery.

    I can say with my hands on my heart any Thai national with a “brain” will not be spending there hard earned Thai baht at the shopping “Malls” and booking a holiday in or out of THAILAND! – FACT.

    Thailands government is “Spin Doctoring” and trying to paint a picture that all is “Rosy” with Thailands economy.

    It really is not.

    I read that the USA is now 26 trillions USD in debt. WOW! A trillion plus owed to Chinese!

    At the end of the day that sum of cash shall never get paid back.

    No amount of money pumped into Thailand s economy will do anything as the funds/cash is already lost. Of course you can only dream where the diverted cash will go!!!!!!!

  2. Avatar

    Toby Andrews

    Friday, July 3, 2020 at 2:13 pm

    The United Nations say Thailand will lose $47 billion.
    I would rather believe the UN than a Thai Finance minister.
    Thailand has lost credibility, with the heavy handed handling of this pandemic.
    No smart investor will trust the present government. There is no telling what they will do to screw things up next.

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Economy

Stimulus package gives more back the more you spend

Neill Fronde

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PHOTO: A new stimulus package aims to get the middle class spending. (via Flickr - Marco Verch)

A new stimulus package targeting middle and high-income people aims at increasing spending by offering more e-voucher the more you spend. Ying Chai Ying Dai, which translates to “the more you spend the more you get”, will reward those who spend between 46,000 and 70,000 baht with a 7,000 baht e-voucher. This part of the government’s 225 billion baht stimulus package hopes to encourage 4 million qualifying middle- to upper-class people to spend more money by refunding 10-15% back, according to the Finance Ministry’s Fiscal Policy Office.

People wishing to participate must register and make their purchases through a government e-wallet system. The system works by refunding 10 to 15% of purchases with a maximum of 7,000 baht. So at 15%, a person who spent 46,000 baht would receive back the full 7,000. On the 10% scheme, 70,000 baht in spending would be necessary to reach 7,000 cashback. No details were available on what determines the percentage level.

An additional 2,000 baht will be available for people participating in the “Section 33 Rao Rak Kan” and “Rao Chana” scheme. The plans are expected to push 85.5 billion Baht back into the economy as recipients must spend the cash by the end of June.

The 50/50 stimulus program that has been popular with the government covering half of what people spend for half for food, drink, and other items up to 150 baht per person per day will also be expanded. That plan began on October 23, and ended at the end of 2020, covering 10 million people with each receiving 3000 baht. The second phase of the popular program added 5 million more people and raised the limit to 3,500 baht per person.

A third phase of the “Khon La Khrueng” stimulus plan is expected to begin in July with participants getting a maximum of 3,500 baht each to spend, and opening the program to 16 million new people. This massive expansion though will stipulate that anyone participating in this program cannot also participate in the Ying Chai Ying Dai scheme.

All of these cash and voucher benefits aimed at supporting vulnerable groups, along with cash handouts for people who have state welfare cards, are part of 245 billion baht the government is spending in an attempt to keep the economy from collapsing. This falls under an emergency loan decree allocating the government 1 trillion baht total to cope with Covid-19.

SOURCE: The Phuket News

 

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Economy

Thailand increases durian exports to China by 14% this year

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Thailand has exported 14% more durian to China in this year’s first quarter over the same period last year. The Trade Negotiations Department Director General says Thai durian auctions in the first quarter secured 186 million, making up 88% of the total amount of Thai durian exports to world markets.

Last year, Thailand exported US1.5 billion worth of durian to China, a 78% increase from 2019. China’s share accounted for 73% of total Thai durian exports to world markets. 18 countries have free trade agreements for fruit with Thailand. Thailand is actively exporting fresh fruit with its top buyers being Australia, Chile, China, Hong Kong, Indonesia, Malaysia, the Philippines, and Singapore. The most popular fruits are the national delicacy of durian, along with mango, mangosteen and longan.

Despite the increases in durian exports, farmers have been worried about Covid-19′s effect on the industry. Earlier in 2021 health authorities in China circulated a press release stating that imported cherries from Chile had been tested and found to have Covid-19 contamination. This statement prompted a huge drop in Chilean cherry prices. Thai growers are worried the same might happen to durian imports. As the seriousness of the Coronavirus in Thailand reaches new widespread levels, one instance of a durian container being linked to Covid-19 could spur a total ban on importing fruit from Thailand.

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SOURCE: MENAFN

 

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Economy

GDP forecast dropped to 1-2% with best, middle and worst case scenarios

Neill Fronde

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FILE PHOTO: Economic predictions continue to fall with Covid-19 spread and slow vaccination.

Mass vaccination will be the key stop the slump in economic growth after the Bank of Thailand revised their 2021 GDP forecast to between 1 – 2%. They had previously estimated a 3% growth in the gross domestic product but are now creating tiered predictions of a base level, worse situation, and a worst-case scenario, according to the Bank of Thailand’s Monetary Policy Committee.

The base GDP forecast, which you could call a best-case scenario, expects a 2% growth predicated on some rosy numbers like foreign tourism growing to 1.2 million people and unemployment staying around 2.7 million. It also operates on the assumption that Thailand reaches 100 million vaccines distributed by the end of the year which would allow herd immunity by the beginning of 2022.

The middle ground prediction is a 1.5% GDP growth if 64.6 million vaccines are administered, delaying herd immunity to the third quarter of 2022. It also allows for unemployment to grow by another 100,000 people, and tourism to reach only 1 million foreign visitors. If we don’t get this tourism growth and unemployment and underemployment expands to 2.9 million or above, and we distribute less than 64.4 million jabs, the worst-case scenario would be only a 1% GDP growth and herd immunity not being possible until the end of 2022 at the earliest.

The worst-case scenario would be a 5.7% drop in the GDP this year, a loss of 890 billion baht. The middle ground forecast would cost about 460 billion Baht, about a 3% drop in Thailand GDP.

The BOT had originally forecast stronger GDP growth but reduced from 3.2% to 3% before dropping their predictions to the 1% to 2% figure. With the devastating effect of the third wave of Covid-19 being much more far-reaching than originally expected, this new prediction was released now instead of when it was scheduled in June. They did state that government economic stimulus packages could still have a positive effect and allow the economy to grow 3 to 5.7%, assuming mass vaccination goes into effect quickly.

The tourism sector and small-to-medium-sized enterprises would be the most affected by the delays in vaccination. The Monetary Policy Committee stressed that the economy hinges on the speedy importing and administering of vaccines. Faster vaccination will prevent mutations, new strains, and new outbreaks, as well as allowing international borders to fully reopen more quickly and more successfully. They stress that government efforts to support the economy must continue as the government has recently announced they will extend cash stimulus programs and allot money to more low-income assistance.

SOURCE: Bangkok Post

 

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