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Thailand: Consumer confidence index perks up
Consumer sentiment picked up for the first time in three months in February, boosted by the government’s economic stimulus measures and the promise of mass distribution of Covid-19 vaccines.
The University of the Thai Chamber of Commerce (UTCC) reported on Thursday the consumer confidence index rose to 49.4 in February from 47.8 in January, following readings of 50.1 in December and 52.4 in November.
Thanavath Phonvichai, UTCC’s president, said consumers felt less concerned about the pandemic after Thailand began inoculations late last month, while the government’s economic stimulus packages, especially the Rao Chana (We Win) financial relief scheme, helped boost consumer spending.
Mr Thanavath said a rise in the prices of farm products also helped increase the purchasing power of consumers in provincial areas.
“Thailand is likely to see a clearer sign of economic recovery from the second quarter this year if the country’s vaccination plans become more apparent, and if the country is more open to foreign tourists,” he said.
“This will bolster consumer sentiment from the second quarter onwards.”
Mr Thanavath said close monitoring is still required to determine whether the government’s measures to contain the spread of the virus and its economic stimulus measures will be effective.
The UTCC recently estimated three key economic stimulus packages — the Rao Chana financial aid scheme, the co-payment subsidy scheme, and the “Section 33 Rao Rak Kan” (We Love Each Other) financial relief measures — will help boost the country’s economic growth by a combined 1.76 percentage points this year.
The three stimulus packages are estimated to help contribute as much as 301 billion baht in spending, with the retail and wholesale sector, lodging and food services enjoying the most benefits.
Mr Thanavath said another factor that may affect future consumer sentiment is the domestic political situation, the government’s fresh cabinet shake-up, higher oil prices, the strong baht, and the country’s overall economic growth prospects.
He cited a recent downgrade of the economic growth forecast by the National Economic and Social Development Council for 2021 to 2.5-3.5% from 3.5-4.5% (made in November), mainly due to a fresh wave of infections.
The UTCC forecasts economic growth of 1.5% in the first half of 2021 and 4.5% in the second half, with full-year growth of 2.8-3% this year.
Global vaccine distribution should play a key part in driving recovery, luring over 6 million foreign travellers to Thailand in 2021, above the 4 million previously projected, said UTCC.
Source: https://www.bangkokpost.com/business/2082311/consumer-confidence-index-perks-up