Thailand’s Consumer Confidence Index in May dropped for
the first time in the six months since Dec 2011 to 77.1 from the 77.6
recorded in April, according to a survey by the Economic and Business
Forecasting Center at the University of the Thai Chamber of Commerce (UTCC).
Centre Director Thanawat Ponwichai released the survey
Tuesday, saying that the overall consumer confidence index still remained
below 100 due to concerns over political instability after the chaos which
disrupted last week’s deliberation of reconciliation bills in the lower
house of Parliament and protests outside the Parliament.
The index of the opinions of respondents regarding the
political situation in May fell to 66.3, the lowest in the past 11 months,
while the prospects for the index of the political situation in the next
three months dropped to 76.6, the lowest in 12 months.
The survey showed that consumers were also worried about
the debt crisis in the eurozone and the high cost of living, with the
confidence index falling for the fifth consecutive month to 49.7, the lowest
in 23 months.
The centre said the economy in the euro zone countries,
particularly Greece and Spain, remains worrisome as the problem seems to be
worsening and may affect Thai export’s sector, forcing a drop by 10-13
percent from earlier projected.
The drop in oil prices was caused by lower global demand,
reflecting the global economic slowdown, while the U.S. also has been
impacted by the eurozone economies, the director said.
However, depreciation of the Thai baht may help support
Thai exports. It suggested that the government should focus on key Asian
markets such as China and the ASEAN countries and commercial attach้s should
support the private sector to stimulate Thai exports. Meanwhile, Thai
tourism, projected to generate an income of Bt650 billion, will help boost
the economy.
The centre forecast public consumption will likely
continue to be sluggish in the second quarter this year. The government
should speed up implementing its fiscal and monetary policies through budget
spending and offering loans to put more money into circulation, which will
help prop up the economy, Dr Thanawat said.
If the political situation improves, the Thai economy is
likely to recover in the middle of the third quarter this year and is
projected to grow 5.5-6 percent, he said. (MCOT)
