Thailand’s economy eyes rebound in 2023 buoyed by China’s booming influence
A light of hope has started to shine on the future of Thailand’s economy as we look forward to this year, and China’s influence as a significant driving force cannot be ignored, so suggests a leading Thai economist. The said economist, Kirida Bhaopichitr, who honours the position of Director for the Economic Intelligence Service at the Thailand Development Research Institute (TDRI), highlighted this perspective in a recent interchange with the State news agency of China, Xinhua.
Kirida and her expertise noted how the compounded factors of China’s economic growth and the strengthening cooperation established between China and Thailand in various industries are taking centre stage in reaffirming Thailand’s road to recovery. Interestingly, China’s influence is also alleged to help buffer against the potential risks that accompany aspects such as sluggish global economic growth.
As she further delved into the specifics, Kirida warned of the multitude of factors that precisely induce stress on Thailand’s exports. These disruptions include fluctuations in the exchange rate of the Thai baht, unexpected natural disasters, an increase in unpredictability of the U.S. economy and geopolitical risks. With such factors in play, a continuation of contraction in Thai exports can be anticipated in the near future.
But amidst the challenges and potential pitfalls, Kirida certainly highlighted the silver lining, stressing the significance of China as an incredible ally. China stands strong as a premier trading partner, the backbone of foreign direct investment, and a crucial component in boosting tourism, not only benefiting Thailand but also the Association of Southeast Asian Nations (ASEAN) at large. According to her, China’s economic prowess will be a pivotal contributor to Thailand’s economic growth and expansion.
As we turn our focus to the first half of this year, an intriguing trend has emerged, according to data from the Thailand Board of Investment (BOI). In an astonishing revelation, an impressive increase of 70% has been recorded in investment promotion applications over the previous year. Moreover, China emerged as the frontrunner in Foreign Direct Investment (FDI) applications. The total pledges of investments from China have ramped up to a staggering 61.5 billion baht, distributed across 132 individual projects. Notably, most of these projects mainly target the manufacturing of electronic parts, reported Pattaya News.
According to Kirida, these Chinese investments play a key role in stimulating the growth of specific industries within Thailand. These fields notably include electrical vehicles and their parts, along with electronics and Information Technology (IT).
Moreover, Kirida mentioned the growing trend in private consumption, attributing the consistent uptick to a reviving labour market. This rejuvenation appears to be fuelling an improvement in consumer confidence across all occupational groups, further cementing the path to recovery for Thailand’s economy.
