Bangkok: The private sector in Thailand is pinning its hopes on exports and tourism to bolster the country’s GDP, particularly after a modest growth of 1.2% in the third quarter of the Year of the Snake. They stress the need to revitalize tourism and explore new markets, alongside expediting Free Trade Agreements (FTAs) to tackle the challenges posed by a weakening baht, drawing parallels with strategies adopted by neighboring countries. Brokers, however, remain apprehensive about the GDP performance in the fourth quarter.

According to Thai News Agency, Ms. Kanyapat Tantipipattanapong, an advisor to the Thai National Shippers’ Council (TNSC), expressed a cautious optimism despite widespread concerns, noting that the National Economic and Social Development Board (NESDB) still sees potential in exports to uplift the Thai economy. Recent developments, such as former President Trump’s tariff exemptions for the agricultural and food sectors, have infused hope within the private sector. Additionally, the Thai government has rolled out measures to stimulate tourism in secondary cities, including a 1.5x tax deduction for individuals and initiatives to engage government and state enterprises in organizing seminars, all aimed at boosting year-end tourism.

The global economic slowdown has led to a decline in private sector investments, resulting in hesitance to make further investment decisions. This has placed the onus on public sector investment to drive growth. The government’s “Half-Half Plus” program, designed to stimulate public spending, has created a favorable environment for economic activity, a move that the private sector supports, viewing it as a better alternative than having no economic revival measures. They also advocate for the acceleration of FTA negotiations with the United States and Europe, as several countries are set to have trade agreements with the European Union from January 1st. The private sector also calls for a depreciation of the baht to align with neighboring currencies; currently, the baht stands strong at 32 per US dollar, while the Japanese yen has significantly weakened.

Mr. Vikit Thirawanrat, Assistant Managing Director of Bualuang Securities, highlighted that the 1.2% GDP growth in Q3 fell short of market expectations, which were between 1.3% and 1.7%. This shortfall has sparked concerns about the economic trajectory for the rest of the year. While the government has introduced several measures aimed at economic revival, these efforts are deemed insufficient. The unsatisfactory earnings reported by listed companies for Q3 have further fueled concerns, with expectations that Q4 might reflect a similar trend, casting a shadow over the end-of-year economic outlook in the capital market.