Bangkok: The Industrial Confidence Index (ICI) has seen a slowdown due to a contraction in automobile and air-conditioning shipments to the Australian and US markets, prompting the government to expedite the “Quick Big Win” economic stimulus strategy. Despite the current downturn, the index is projected to rise over the next three months, though concerns remain regarding the grey market’s impact on investor confidence and the country’s image.
According to Thai News Agency, Mr. Kriangkrai Thienukul, President of the Federation of Thai Industries (FTI), announced that the Industrial Confidence Index for October 2025 was 87.3, a slight decrease from September’s 87.8. This decline is mainly attributed to a decrease in durable goods exports, particularly combustion-engine vehicles and air conditioners, due to reduced demand in key markets such as Australia and the US. Additionally, wood product orders continue to decline in China and Malaysia. The US federal government shutdown poses another risk, projected to reduce the country’s GDP by 0.1% weekly, potentially affecting the broader US economy and labor market. Meanwhile, China’s imports have surged by 33.49% year-on-year from January to September 2025, impacting domestic manufacturers, especially in the home appliances, steel, and plastics sectors.
Moreover, widespread flooding continues to affect agricultural processing and business operations, with border trade contracting significantly. In September 2025, trade with Myanmar dropped to 9.401 billion baht, a 40.8% decrease, while trade with Cambodia plummeted by 99.9% compared to the previous year.
Nevertheless, October witnessed several positive developments stabilizing the economy. The Oil Fund Management Committee (OFMC) reduced diesel and gasoline prices, easing living costs and production expenses. The Vegetarian Festival and peak tourist season bolstered domestic spending, particularly in food, handicrafts, and clothing. The peace agreement with Cambodia has alleviated border tensions, and government initiatives like “Half-Half Plus” and “Travel Dee Mee Kuen” have boosted public spending in the year’s final quarter.
The FTI’s survey of 1,335 entrepreneurs across 47 industry groups in October 2025 highlighted increasing concerns about the domestic economy (67.3%), the global economy (63.1%), and exchange rates from an exporter’s perspective (48.1%). However, concerns over government policy, credit access, energy prices, and loan interest rates have decreased.
The index’s forecast for the next three months shows an upward trend, reaching 93.5 from 91.8 in September 2025, reflecting improved business confidence. This is driven by government “Quick Big Win” measures addressing household debt and supporting SMEs through loan guarantees, enhancing liquidity and stimulating investment.
Furthermore, Thailand and the US have reached a reciprocal trade agreement framework, expected to benefit Thai exports. Easing trade tensions between the US and China, with reduced tariffs and relaxed restrictions on rare earth exports, also contribute positively to global trade.
Despite these positive indicators, the Thai industry faces challenges, including the grey market’s potential impact on business operations and investor confidence. The appreciating baht also poses a risk to export revenue and the competitiveness of Thai tourism globally.
The government has been advised to expedite disbursements to SMEs, accelerate fiscal 2026 budget spending, and combat grey business practices to foster transparency and maintain a positive economic image.