Thailand Weekly Economic Update

In 2022, Thailand’s digital industry soared to a value of Bt2.6tn, a remarkable 14% surge from the previous year, as revealed by a joint survey conducted by the Digital Economy Promotion Agency (Depa) and the IMC Institute. This thriving sector comprises five key segments: software, hardware and smart devices, digital services, telecommunication, and digital content, collectively underpinning Thailand’s dynamic digital economy.

Consumer confidence improved after a new government was finally formed months after the May 14 general election, increasing to 56.9 from in August from 55.6 in July, according to the University of the Thai Chamber of Commerce.

In August, the year-on-year inflation rate experienced a notable uptick, climbing by 0.88%. This increase can be attributed to the significant rise in fuel prices, which subsequently had a cascading effect on the cost of food. During the same period, FETCO, the Federation of Thai Capital Market Organizations, conducted a comprehensive survey revealing a remarkable surge of 69.3% in investor confidence.

The IEAT has partnered with six Thai and Japanese companies to explore hydrogen fuel applications in the Map Ta Phut and Smart Park industrial estates in Rayong. This collaboration supports global climate change mitigation efforts, promotes carbon neutrality, and attracts investors interested in clean energy solutions for electricity and transportation. The IEAT plans to import hydrogen for use in transportation and logistics within these industrial complexes, covering 6,949 rai in Map Ta Phut and 1,383 rai in Smart Park, serving the Eastern Economic Corridor’s S-curve industries.

The Tourism Authority of Thailand aims to attract more couples from Hong Kong for destination weddings, leveraging their potential. They currently host weddings annually, with a portion being from the affluent new generation. Hong Kong tourists are targeted to increase, with an average daily expenditure rise. Future plans include an increase in spending and an ambitious goal of drawing Hong Kong tourists by 2024.

In July, the Industrial Sentiment Index fell to 92.3 from June’s 94.1, accompanied by a decrease in the forward-looking FTI index. Laem Chabang Port’s Phase 3 construction is at 58%, a top project in the Eastern Economic Corridor. Thailand and Vietnam target a $25B bilateral trade by 2025. Foreign investment in Thailand rose by 17% in investor numbers but declined by 20% in value over seven months. El Niño will lower Thailand’s hydroelectric purchase from Lao PDR by up to 4 billion units. July’s Thai household spending averaged 18,130 baht, slightly dropping but still considered high, per the Trade Policy and Strategy Office.

Mr. Yol Phokasub, the Chief Executive Officer of Central Retail Corporation Public Company Limited, has devised a plan to convert Family Mart, a convenience store brand under CRC’s umbrella, into TOPS. This strategic change aims to rapidly respond to prevailing market trends. Consumers are in search of convenience stores that provide a broader range of products. TOPS fits perfectly into these preferences by offering a 250-300 square meter space filled with a diverse product selection, aligning with and fulfilling consumer demands

The Ministry of Finance has adjusted Thailand’s economic growth projection for this year to 3.5%, representing a slight decrease of 0.1 percentage point from the previous estimate. In June 2023, Thailand’s exports experienced a decrease of 6.4%, attributed to the sluggish economy of a trading partner country, which faced pressures from exchange rate volatility and high interest rates. Additionally, Thailand’s manufacturing production index (MPI) in June contracted by 5.24% from the previous year due to the decline in exports.

HP, the leading computer manufacturer in America, has revealed its strategic plans to relocate production operations to Thailand and Mexico this year. The company will transfer a portion of its consumer laptop production to Thailand . Additionally, the Ministry of Tourism and Sport in Thailand disclosed impressive statistics on foreign tourist arrivals since January 1, 2023, surpassing 14 million visitors and generating 587,828 million baht in income.