Industrial sentiment drops to 11-month low

Thailand’s industrial sentiment index in May fell to an 11-month low as the ongoing Covid-19 outbreak continued to ravage most businesses, the Federation of Thai Industries (FTI) reported Tuesday.

The index declined for the second consecutive month to 82.3 points from 84.3 in April, yielding the lowest since July 2020, said FTI chairman Supant Mongkolsuthree.

The third wave has seen many new clusters emerging in factory workers, said Supant.

The slow roll-out of the inoculation programme and ongoing measures to curb the infections have continued to put downward pressure on economic activities and recovery in domestic demand.

“Small and medium-sized enterprises [SMEs] continue to struggle with lack of financial liquidity and lack of working capital,” Supant pointed out, saying that the majority of business owners were still dealing with growing operational costs, as well as labour shortages.

The FTI urged the government to issue financial measures to assist SMEs with easing loan conditions, including a 30-per-cent cut to water and electricity bills.

The three-month sentiment index for the likely situation up to August rose to 92.8 points from 91.8 a month earlier, backed by progress of vaccine distribution, economic stimulus, and public investment.

For exports, Supant said there were still risks of shipping container and electronic chip shortages, as well as high freight rates.

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