Thailand: Confidence edges higher in June poll

Business sentiment picked up for the first time in 14 months in June, boosted by easing of the government’s lockdown measures.

The University of the Thai Chamber of Commerce (UTCC) reported on Thursday that business confidence inched up to 31.5 in June from 31.3 in May, following readings of 32.1 in April, 37.5 in March, 44.9 in February and 45.4 in January. The May figure was a 29-month low since January 2018.

“Improving business sentiment stemmed largely from the easing of the coronavirus spread in the country and relaxation of rigid lockdown measures,” said Thanavath Phonvichai, president of the UTCC. “But the overall economic prospects remain worrisome because of the impact of Covid-19, which crippled employment. Business confidence is likely to increase if the government speeds up disbursement of the social and economic rehabilitation budget in the third quarter.”

The cabinet on Wednesday approved a budget allocation of 100 billion baht for the first phase of the 400-billion-baht spending plan for social and economic rehabilitation, aimed at strengthening the farming sector and creating more jobs.

The second phase is worth 300 billion baht. Details will be released later.

The cabinet also approved five projects worth 15.5 billion baht proposed under stimulus packages altogether worth 400 billion baht.

The first is a One Tambon, One New Theory Cluster project worth 9.8 billion baht. The scheme focuses on increasing farmers’ income and employment.

Another, worth 4.7 billion baht, aims to increase farmers’ income and employment.

A third project, worth 169 million baht, involves developing soil and fertiliser businesses, while a fourth will boost safety at tourism spots.

Mr Thanavath said the business sector has urged the government to rev up stimulating the economy as quickly as possible, especially for the 100-billion-baht first phase to create jobs, particularly in the farm sector.

The UTCC estimates that spending in the first phase of the rehabilitation budget will help stimulate growth by 0.3-0.5 percentage points.