Thai economy set for revival amid global uncertainties
The Federation of Thai Capital Market Organizations (FETCO) anticipates a revival of the Thai economy in the latter half of the year, supported by potential interest rate reductions. This optimistic outlook emerges amidst global economic uncertainties, with possible recessions in the UK and Japan, and China grappling with a prolonged property crisis.
FETCO chairman Kobsak Pootrakool believes that the global economy could bounce back once central banks commence lowering their interest rates, which may occur in the coming months.
“Central banks all over the world may keep the current policy rates unchanged until mid-2024. In the second half of this year, those central banks might start cutting rates. And if central banks across the globe keep cutting rates every quarter for a half to a full year, this might result in the world economy entering a new recovery stage.”
Despite global economic deceleration and geopolitical turbulence, Thailand’s tourism sector has demonstrated resilience, aiding the country’s economy. So far, the country has seen an influx of six million international tourists this year, with one million coming from China.
Thailand also continues to attract holidaymakers from Malaysia and India. As per the Ministry of Tourism and Sports, Thailand greeted approximately 5.98 million overseas tourists between January 1 and February 25. Visitors from China topped the list, followed by Malaysians (760,000) and Russians (397,000), Kobsak said, during an event hosted by Fetco and the Securities and Exchange Commission (SEC).
“I think the government’s goal to welcome 35 million foreign visitors in 2024 is achievable. The tourism sector might drive the economy this year by 2%.”
Alongside anticipated tourism growth, Kobsak also highlighted that the government budget for fiscal 2024 would be ready for disbursement in May, and exports have started to recover. Coupled with increasing foreign investment, he forecasts a 3% economic growth for Thailand this year.
Social development
At the same event, the SEC’s secretary-general, Pornanong Budsaratragoon, stated that the commission aims to promote community investment and social development. She expressed the commission’s readiness to assist companies in raising funds through the stock market and drive all stakeholders towards sustainability.
The SEC has set guidelines to allow fundraising in the capital market via a cloud funding channel and private placement. It has also issued requirements for sustainable-theme bonds, such as green bonds, social bonds, and sustainability bonds.
“The total funds raised at the end of January through these bonds exceeded 700 billion baht.”
Pornanong further revealed that the major issuers of such bonds are in the government sector, including the Ministry of Finance. The funds procured from these transactions will be utilised for various investment programmes, such as the construction of the MRT Orange Line.
