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The Cabinet acknowledged the report of the Thai economy in Q3’20 shrinking 7.8% – Slowly recovering GDP in 64 exports expanded 4.5% Household debt dragged – Unemployed increased OT, reduced tourists to 9 million. D. Expect 2-year economic collapse – high volatility
On January 5, 2021 at the Government House, Ms. Trisulee Traisanakul, Deputy Spokesman for the Prime Minister’s Office, said that the Cabinet (Cabinet) acknowledged the Ministry of Finance’s report on the state and outlook of the Thai economy for the third quarter of 2020.
The report states that The Thai economy in the third quarter of 2020 has recovered gradually. After relaxation of COVID-19 epidemic control measures Both in Thailand and abroad Private consumption began to gradually recover. But it remained at a low level following lower household income. Weak consumer confidence and higher household debt Private investment contracted following low confidence in the corporate sector. But government spending is still a major economic driver.
For the whole year of the Thai economy in 2020, the Ministry of Finance sees that It is likely to shrink 7.8 percent as the economy in the second quarter was severely affected by the COVID-19 control measures. Strict both at home and abroad Tourism tends to recover slowly. As a result of the COVID-19 situation In a foreign country that tends to be protracted On the other hand, merchandise exports tended to contract by 8.2 percent, with exports to ASEAN and the Middle East still at a low level following the economic outlook of trading partners. While exports to major industrialized countries and China began to gradually recover.
As for the Thai economy in 2021 is expected to expand by 3.6 percent, exports are expected to expand at 4.5 percent, while service exports tend to recover slowly due to limited availability to tourists. The number of foreign tourists stands at 9 million. Domestic demand, government spending remains the main driver. As for private consumption, the trend will gradually recover
But there is still a drag factor from high household debt Including high household income that is fragile and uncertain Which is caused by the number of unemployed persons And like the unemployed who work less than 4 hours a day are at a high level. And the workers have lower income from wages and overtime pay.
While the stability of the Thai financial system is still at high risk due to the economic contraction caused by the COVID-19 outbreak. As a result, the financial status of both the household and business sectors is fragile and is subject to the risk of default. However, the government’s proactive financial and credit measures have been implemented. Including additional measures that are more direct, such as the DR BIZ project, financial cooperation with stable Thai business And measures for debt restructuring for retail receivables through debt consolidation Will help mitigate the risks that arise
However, the Monetary Policy Committee (MPC) considers that the recovery of the Thai economy will take at least two years to return to pre-COVID-19 levels. And face high uncertainty In addition, economic recovery trends are very different between sectors of the economy and individual operators.
The government sector, therefore, should take measures that are timely and conducive to appropriate adjustments. Including the integration of measures to be more consistent and coherent The easing monetary policy will support fiscal policy through low borrowing costs in the financial markets under high liquidity in the financial markets.
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