• GDP forecast for 2023 and 2024 was revised to 2.4% and 3.2%, respectively.
•  BoT has revised down the growth projection that takes into account the impact from the government’s digital wallet scheme to 3.8% in 2024, down from the previous projection of 4.4% 

The Cabinet recently approved a significant raise in the starting salary for incoming civil servants, elevating it from 15,000 Baht to 18,000 Baht per month, a change specifically targeted at new government sector hires. However, amidst this positive news, concerns about Thailand’s economic landscape have surfaced. The National Economic & Social Development Council (NESDC) unveiled troubling statistics, revealing that in Q3 of 2023, Thailand’s household debt-to-GDP ratio reached a concerning 90.6%.

On a brighter note, Thailand’s Digital Competitiveness ranking for 2023 surged by five places, landing the country at 35 among 64 economic territories, indicating progress in this domain. Despite economic challenges, Thailand’s exports showed resilience, with October 2023 witnessing exports amounting to US$23.58 billion (828.22 billion Baht), marking an 8% increase.

Conversely, the manufacturing production index for October displayed a concerning decline of 4.29% year-on-year, falling below expectations outlined in a Reuters poll and following September’s 6.06% decrease. In response to these economic fluctuations, Prime Minister Srettha Thavisin emphasized the urgency of addressing debt issues and combating the exploitation of citizens by loan sharks.

Tourism

Civil Aviation Authority of Thailand (CAAT)

The Civil Aviation Authority of Thailand (CAAT) has reported ten Chinese airlines, including major carriers such as Air China, China Eastern, and Shanghai Airlines, have canceled their scheduled flights to Thailand for December 2023 and January 2024. The lower-than-expected booking numbers during these months. The cancellation of these flights is indicative of a substantial decrease in tourist numbers from China to Thailand, a trend that poses potential challenges for the tourism sector in Thailand, which often relies heavily on visitors from China.  The free visa initiative did not significantly boost the Chinese market.The anticipated number of Chinese tourists visiting Thailand is likely to be lower than initially expected. The Tourism Authority of Thailand (TAT) has revised its forecast, predicting that around 3.4 to 3.5 million visitors from mainland China will travel to Thailand this year. This number falls short of the previously targeted 4 million Chinese arrivals. Despite concerted efforts to draw in Chinese visitors, tourist arrivals from China have not met the Thai government’s expectations, largely due to safety concerns. The release and growing popularity of the Chinese action movie “No More Bets” has sparked widespread rumors on social media platforms about potential risks associated with traveling to Thailand, contributing to the lower than anticipated tourist numbers.

New Scheme

Thailand is set to revolutionize its tourism and shopping appeal with a five-pronged government plan. This initiative, aiming to transform Thailand into a duty-free paradise, includes several strategic measures:

1. Tax and Financial Incentives: To attract both local and international tourists, the plan involves tax reliefs and financial incentives, focusing on locally crafted products like perfumes, clothing, and    fashion bags.

2. Excise Tax Restructuring: Adjustments in excise taxes will make specific products more affordable, potentially undercutting prices in other countries.

3. Cancellation of Arrival Duty-Free Shops: In a significant change, duty-free shops upon arrival  will be discontinued, encouraging tourists to engage in retail therapy throughout their stay,  with departure duty-free shops remaining operational.

4. Extended Hours for Night Entertainment: Key tourist districts will see their nightlife venues open for extended hours, enhancing the nighttime experience.

5. Focus on Thai Products in Duty-Free Shops: The Ministry of Finance is reworking the duty-free shop inventory to feature Thai products prominently, aiming to attract tourists seeking luxury shopping experiences.

These measures are part of Thailand’s broader efforts to bolster tourism and establish itself as a leading destination for travelers and shoppers.

Crypto Currency

Zipmex Company Limited (Zipmex)

The Securities and Exchange Commission (SEC) of Thailand has directed Zipmex Company Limited (Zipmex) to rectify its capital status due to its failure to maintain the required net liquidity (capital funds) since November 24, 2023. This directive follows the SEC’s monitoring of Zipmex’s financial position and liquidity, as per the regulations of Section 16/1 of the SEC announcement No. กท. 19/2561 regarding digital asset business operations. Zipmex is required to suspend all business operations until it can re-establish its fund and receive SEC’s approval to resume normal business activities. The SEC has also mandated Zipmex to inform its customers in writing about the suspension of all business operations without delay.

Zipmex has announced a temporary suspension of digital asset trading and deposits of all asset types from November 25, 2023, at 13:00 p.m. onwards, to comply with SEC regulations. Customers can still withdraw baht and digital assets stored in their Trade Wallet via the website and mobile applications until January 31, 567. After this date, withdrawals will require contacting Customer Support, and digital asset withdrawals may take 7-14 days to process.

Commerce

 CP Axtra Public Company Limited (CPAXT)

CPAXT shares dropped 4.46% to 26.75 baht, a decline of 1.25 baht, with a trading value of 44.08 million baht (US$ 1.26 million)  between 10:00 and 10:27 a.m. The market opened at 27.25 baht, with the highest price reaching 27.50 baht and the lowest at 26.50 baht.

The Makro, amid the controversy over illegal pig seizures, confirmed its adherence to legal standards in pork purchases. Makro stated that 100% of its pork comes from domestic sources with clear production chains and necessary certificates from the Department of Livestock Development. While most pork entrails are bought domestically, imports occur when domestic supply cannot meet the demand for certain products like pork brisket and offal, but always with valid import and movement licenses. Makro had business relations with the accused company, primarily purchasing fish and seafood. However, due to quality issues detected in mid-2023, Makro ceased orders from this supplier.

Energy

The Energy Regulatory Commission (ERC) has approved a new Fuel Tariff (FT) rate of 89.55 satang for the January to April period of the upcoming year. This adjustment will lead to an increase in the current electricity rate by 69.07 satang per unit. Currently, the electricity rate is 3.78 baht per unit, which means the new rate will be 4.68 baht per unit, excluding value-added tax. The ERC’s decision to raise the FT rate was made after considering its impact on consumers and the necessity to maintain energy security and efficient service from the Electricity Generating Authority of Thailand, especially in the face of rising costs.

SECTORAL UPDATE 

 SET closed the week at 1,380.31 points, an increase of 0.13 points (+0,01%) trading value 37,615.16 million baht ( US $1,073.52 million)  

The SET Index support zone is at 1,370 points with resistance at 1,426 points while in the medium – term resistance is a1450 points.

The RSI lowers slightly in the week closing at 37.36.At the same time the USD/THB weakens with support at 35.00 and resistance at 35.70.

Since the beginning of the year is far Foreign Investors have been net selling with significantly pressuring the market.