MACROECONOMICS WEEKLY UPDATE

The Department of Internal Trade on Wednesday fixed the farm price of assorted chicken eggs at a maximum 3.2 baht per egg in a bid “to help farmers while not creating a financial burden for consumers”. “According to The Department of Livestock Development has confirmed that the average cost of egg farming is 2.94 baht per egg based on the current animal feed price and the frequency in which hens lay eggs during summertime,”

Mr. Akhom Thampittayapaisit the finance minister believes that the election boundaries will not affect the business sector and said that during the period of the acting government, there would be no additional economic stimulus measures because the budget could not be used for projects that are not covered by the Expenditure Budget Act. It is expected that the Thai economy in 2023 will expand by 3-4%.

The Office of Agricultural Economics (Agricultural Economics Office), Ministry of Agriculture and Cooperatives revealed the agricultural economy in the 1st quarter of 2023 (Jan. – Mar. 23) grew by 5.5% compared to the same period in 2022 with a value of more than 1.82 billion baht due to the amount of rain accumulated throughout the past year. Thus, the amount of water in the reservoir and in natural water sources is sufficient for cultivation and animal husbandry. 

Ministry of Commerce points to a bright future for Thai pet food products Ranked 4th in the world and 1st in ASEAN 2022 : U.S. exports worth more than USD 2 billion, up 15% in U.S., ASEAN, EU and Australian markets grow well, supporting FTA expansion after 15 trading partners exempt taxes on pet food imports from Thailand.

The Federation of Thai Industries (FTI) has urged the Energy Regulatory Commission to review fuel tariffs every two months due to the rapidly evolving global economic landscape. FTI Vice Chairman Isares Rattanadilok na Phuket commented on Wednesday that the first adjustment of this year, from January-April, preceded a period of high global energy prices and a weak baht. As a result, energy bills for businesses have surged by 13%, from 4.72 baht per unit to 5.33 baht. As the second adjustment in May is based on figures from January, it will not accurately reflect the current economic situation and cause a burden on people..

According to ttb analytics, the research arm of TMBTHanachart Bank (ttb)Thai exports are expected to contract by 0.5% this year because of the global economic slowdown. The most severe contraction is forecast to take place during the first five months of the year, before beginning to recover during the remaining seven months, said Naris Sathapoldeja, head of ttb analytics. He attributed the dip to a cooling of the global economy and the economies of Thailand’s trading partners.  

Industrial sentiment has seen a notable upturn as a result of stronger domestic demand. The Thai Industries Sentiment Index rose for the third month in a row in February, reaching 96.2 – the highest it’s been since April 2019. All components, including sales, output, costs and performance, have seen progress. Factors like consumption revival, hopeful signs of a resuming tourism industry, China’s reopening economy and government stimulus measures have given a boost to the economy. Prices of inputs have also dropped from last month. Economic activity is rebounding within Thailand and this is having positive implications on production in sectors such as food and drinks which increased by 1.5% in January (up from -2.0% in December). Despite weakened demand for exports such as chemicals, rubber goods and plastics worrying producers, the anticipation of tourism coming back and increasing domestic consumption has caused the 3-month expected sentiment index to rise from 101.1 in January to 103.6 in February – its 2nd time surpassing the 100-point mark this year. Plus, after May elections more money is expected to be injected into the economy while those involved with tourism and exports will benefit from more relaxed COVID restrictions in China. However, economic slowdowns in US & Europe along with global financial market instability might cause trepidation – particularly for businesses dependent on foreign markets.

 

INDUSTRY

CONSUMER AND RETAIL

University of the Thai Chamber of Commerce’s Centre for Economic and Business

Election campaigns will generate up to 120 billion baht for the Thai economy which will push Thailand’s GDP up by 4% in the second quarter. “Political parties will go into full gear with campaigning for votes now that the election date has been set,” the centre’s director Thanawat Polvichai said and added that “Thailand is expected to grow by 3-4% this year. However, rising production costs and inflation can affect the Thai business sector’s profits and liquidity and that the business sector is concerned that the election may spark political conflicts which may trigger delays in investment.”.

ENERGY

GULF 

GULF announced that on March 20, 2023, Pak Lay Power Company Limited was established as a joint venture between it and Sinohydro (Hong Kong) Holding Ltd. (SHK). The Company holds 40%, while SHK holds 60% of the shares. They have also signed a Power Purchase Agreement with EGAT for a period of 29 years beginning from the date of power distribution to the system. The Pak Lay Hydroelectric Power Plant Project is scheduled to commence commercial operation on January 1, 2032, with an installed capacity of 770 megawatts and located on the Mekong River in Xayaburi Province, Lao People’s Democratic Republic (Lao PDR). All generated electricity will be sold to EGAT at an average rate of 2.6989 baht per kilowatt-hour.

TOURISM

Ms. Trisulee Trisoranakul, Deputy Spokesperson for the Prime Minister’s Office, announced that from the beginning of January to mid-March of this year, 5,578,721 foreign visitors had arrived in Thailand, bringing in a total of 215,052 million baht. The overall tourism situation is steadily improving, both for travel by Thai nationals and foreign travelers. Moreover, the Chinese ambassador to Thailand predicted that more than 300,000 Chinese tourists will enter Thailand in April.

AVIATION

Bangkok Aviation  Fuel Service Plc (BAFS)

Bangkok Airways expects its passenger rate to hit 70-80% of the pre-pandemic level this year, roughly 4.4 million people from more than 40,000 flights. Puttipong Prasarttong-Osoth, president of Bangkok Airways, said “long-haul demand has grown better than expected since the final quarter of last year, which will help to hit the target of 15 billion baht in revenue for 2023.” Mr Puttipong said European passengers currently accounted for 60% of the total, followed by Asia-Pacific and Thai passengers.

Airports  of Thailand Public Company Limited  (AOT)

Airports of Thailand Public Company Limited (AOT) or AOT revealed that the Board of Directors Meeting of AOT No. 5/2023 held on March 22, 2023 resolved to acknowledge the cabinet resolution. Approved the Don Mueang Airport Development Project (DMK) Phase 3 on November 29, 2022 to increase the capacity to accommodate passenger volume from 30 million people per year to 40 million people per year, with an investment amount of 36,829.50 million baht, where AOT will use cash flow from operations of AOT

CONSTRUCTION  

Precise Corporation  Public Company Limited (PCC)

Union Auction Public Company Limited by Yuanta Securities (country) revealed that this year’s growth tends to improve steadily, with a net profit of 287 million baht expected in 2023, growing 18.6%. Benefit from an acceleration in the number of vehicles confiscated from financial institutions. and used car prices drop Encourage the car auction at the auction house to expand steadily.

SERVICES

Union Auction Public Company Limited (AUCT)

Pakorn Peetathawatchai Director and Manager Manpong Senanarong Deputy Manager Head of Issuer Division The Stock Exchange of Thailand together with Risara Charoenpanich, Chief Executive Officer of PRTR Group Public Company Limited, attended the opening ceremony for the first day of trading on the Stock Exchange of Thailand of PRTR Group Public Company Limited. Providing comprehensive human resource services on March 15, 2023 with a market capitalization at the IPO price of 4,320 million baht, using the stock trading abbreviation “PRTR”.

HEALTHCARE  

Prof. Dr. Chalerm Harnpanich, Chief Executive Officer of Bangkok Chain Hospital Public Company Limited or BCH, revealed that the company set a total revenue target for the year 2023 at around 13 billion baht, supported by the following : 

An increase in receiving treatment for both outpatients (OPD) and inpatients (IPD),

The increase in the international patient base, especially from Saudi Arabia, the Middle East region.

Signing a MOU with various agencies, both government and private sectors, to provide employee health check-up services,

Increasing the proportion of social security patients Including considering increasing the government’s per capita disbursement limit.

 

AUTO

According to the Federation of Thai Industries (FTI), car production in Thailand saw a 6.39% year-on-year rise in February, reaching 165,612 units, after being previously limited by a microchip shortage. As the 2023 Motor Show kicks off this week, it is anticipated that car sales will exceed last year’s figure of 34,000-35,000 units and reach 40,000 this year due to an increase in electric car sales. In February 2023 alone, 1,249 new registered electric vehicles (PHEVs) were recorded – a 30.51% increase from the same period in 2022.

AGRICULTURE AND FOOD 

XO

Mr. Jittiporn Chantarach, Managing Director of Exotic Food Public Company Limited (aka XO), has shared that for the outlook in 2023, the company plans to grow their sales by 10% from the previous year and reach a 40% gross profit margin through price adjustments implemented in 2022. Additionally, they plan to expand into new markets, increase their marketing efforts, and host 22 trade shows this year. Lastly, they will be introducing new products in their seasoning sauce group which is their top-selling and most profitable product group.

TELECOMMUNICATION

TRUE

CHINA MOBILE, the No. 4 major shareholder of “True Corporation” sold more than 900 million shares of TRUE, 2.6237% stake to LONG PROSPER GROUP LIMITED. On March 22, 2023, the reporter reported a report on the acquisition or sale of securities of the business (Form 246-2) from the Securities and Exchange Commission (SEC) of True Corporation Public Company Limited or TRU