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The Federation of Thai Industries (FTI) revealed Thailand Industry Sentiment Index (TISI) in July rose for the 2nd consecutive month rising to 89.0, up from 86.3 seen during the month of June this year as sentiments improved amid recovery in domestic economy thanks to the opening of the country and the weakening Thai Baht.
The FTI said that the manufacturing sector expanded as a result of increasing the industrial products’ demands, both durable and consumer goods in domestic and export markets, especially, US, China, Japanese, and India, Kriengkrai Thiennukul, chairman of FTI said.
He added that besides the easing of the China’s lockdown restrictions in major cities has benefited the Thai’s exports. In addition, the reopening measures, and the cancellation of the Thailand Pass system on 1st July 2022, along with the depreciation of the Thai Baht, helped Thai economy and tourism sector to gradually recover.
The survey, which was conducted in July 2022 from 1,238 firms, covering 45 industry clubs nationwide, unveiled factors of concern including
- Global economy (72.2%)
- Domestic politics (40.3%)
- Interest rates on loans (35.5%)
- Fuel prices (80.7%)
- Domestic economy (51.8%)
- COVID-19 pandemic issues (50.1%)
- Thai Baht/US$ rates (32.0%)
TISI for the next 3 months is forecasted at 98.7, increased from 97.5 in June 2022, due to the recovery of domestic and international demands, as well as tourism sector. Whereas Thai entrepreneurs shared concerns over the new wave of COVID-19 pandemic and the tendency of the rising policy interest rate which will contrarily cause financing costs. Furthermore, the uncertain situation of the Russia and Ukraine war will continue to adversely affect energy and raw material prices and, consequently, global economy.
The FTI also came out to recommend what the government should do to help the industry
- To avoid the effect of supply chain shortages, as a result of the tension between China and Taiwan over the Taiwan Strait.
- To conscientiously raise the minimum wage and electricity bills in order to prevent the impact on the manufacturing costs and Thai entrepreneurs’ competitiveness.
- To enhance and strengthen the foundational economy such as accessing funds, building online marketing, and expanding into foreign markets.
- To urgently release relief measures for Thai entrepreneurs who are impacted by the Central Bank of Myanmar’s announcement to suspend repayment of foreign loans, such as, delaying in repayment, suspending the principal repayments (paying only the interest), providing Thai investors with a low interest rate, and allowing Thai financial institutions operated in Myanmar to receive payment in Myanmar currency (Kyat).