Thai CEOs’ Top Concerns: Government Formation Delay and Global Demand Slowdown

CEOs’ top concerns are the delay in government formation and the slowdown in global demand.

According to a survey by the Federation of Thai Industries (FTI) with a sample size of 258 CEOs from 45 industries, their top domestic concerns include:

1. The delay in government formation and political conflicts after the election (81%)
2. High production costs, including electricity, energy, raw materials, and logistics (76.4%)
3. The slowdown in purchasing power due to high household debt (64.3%)
4. Rising interest rates, which are impacting the cost of investment and leading to rising NPL (Non-performing Loan) (54.7%)

Their top external concerns include:

1. High levels of inflation and rising interest rates in many countries, leading to a slowdown in global demand (58.5%)
2. The escalation of the war in Ukraine, which is impacting energy and raw material prices (78.3%)
3. The slowdown of China’s economy after the reopening and possible crisis in the real estate sector (51.2%)
4. Impacts from climate change (39.1%)

Their top concerns for the domestic political situation and the delay in government formation include:

1. Protests and the risk of violence (69.8%)
2. The slowdown of private investment and the political situation’s impact on foreign investors’ confidence (66.7%)
3. The delay in the mitigation of economic problems such as rising living costs (65.1%)
4. The delay in the budget disbursement for fiscal 2024, which could impact various projects (56.6%)

The FTI and the CEOs urged the new government to urgently address:

1. Allowing more private sector involvement in the amendment of laws and regulations (68.6%)
2. Mitigate rising SMEs’ debts and the high level of household debt to prevent a further increase in NPL (57.8%)
3. Reform the education system to address labor shortage problems at all levels (57.8%)
4. Set up a joint public-private committee on energy to consider the reformation of the country’s energy production structure (55.4%)

Meanwhile, 52% of the CEOs believe that the Thai economy will be stable in the second half of the year, while 43% believe that it will get worse. Only 5% said the economy will improve.