Business associations predict brighter days for Thailand’s economy in 2021, bolstered by the release of a coronavirus vaccine, weaker baht and increased domestic tourism.
Suphan Mongkolsutee, president of the Federation of Thai Industries, said at the Nov. 26-27 annual joint chambers of commerce seminar in Bangkok, that while Thailand is still in recession, each quarter’s gross domestic product decline has lessened from a -12 percent the second quarter to -6.4 percent in the third quarter.
He said successful Phase 3 trials of several vaccines and the loss of President Donald Trump in the U.S. elections have buoyed financial markets, giving the world a boost going into 2021.
He said Thailand’s economy will definitely improve, although the four drivers of its economy – exports, tourism, investment and consumption – will not recover fully. The first half of next year still requires the government to pursue economic-stimulus measures, such as expansion of the successful co-pay program and the less-successful subsidized-tourism campaign.
Tourism promotion is especially needed for second-tier cities, Suphan said, and should be expanded to include foreign expats.
He said the government also needs to open the borders wider to foreign tourists, allowing them to go to smaller cities where they more easily can be monitored for disease and support tourism supply chains there.
Foreign-exchange rates also remain a concern, Suphan said, with the baht’s appreciation this year (8 percent) far outstripping rivals such as Vietnam (1 percent).
Kalin Sarasin, president of Thai Chamber of Commerce, agreed the government should continue economic-stimulus programs that end of 2020.
He said campaigns to boost domestic tourism can generate more than 1 trillion baht in revenue for the country.
Warodom Pitakanon, president of the Chiang Mai Chamber of Commerce, said the “We Travel Together” program has boosted the northern city’s economy, even though it has flopped nationwide. Still, he said, domestic tourism cannot replace the income from foreigners, who spend 200 percent more.
“Next year, if the tourism-promotion measures are continued, vaccine development succeeds and foreigners can come to Thailand in the middle of 2021, the economy will be better,” Warodom said. “However, financial assistance from banks is needed at the same time on matters of debt repayment.”
Thanawat Poonsilp, vice president of the Songkhla Chamber of Commerce, said his organization sees reopening the country to tourism as the most important issue and believes Thailand needs to accept more coronavirus risk.
“In 2021, the effects on big businesses, such as automotive, real estate, furniture, etc., will feel the impact from unemployment and staff reductions. Hence, the government must design supporting measures for businesses to avoid unemployment, and for instance, suspend repayment for both loan principle and interest,” he said.
Kamolpong Sanguantrakul, president of Khon Kaen Chamber of Commerce, said the province’s third-quarter GDP was nearly back to normal and many businesses have recovered in the fourth quarter. He said he also wants to see the co-pay and travel programs continued, but subsidy allocations to be redistributed to provide more assistance to Northeast provinces.
Rayong chamber president, Noppadol Tungsongcharoen, also said his province’s buying power is better, but has not regained pre-Covid-19 levels. But the economy is being driven by government stimulus because mass tourism has not resumed. He reiterated demands to continued stimulus and debt relief, along with direct subsidies for small businesses.