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Covid-19 outbreak exposed cracks and faults in Thai economy

Economy

Covid-19 outbreak exposed cracks and faults in Thai economy

Covid-19 outbreak exposed cracks and faults in Thai economy

News Desk

The Covid-19 outbreak that hit Thailand since April has exposed the fragility of the economy and shed light on the fact that we rely too much on export and tourism, Deputy PM Supattanapong Punmeechaow said.

The deputy PM, who also holds the Energy portfolio, was speaking at the “Restart Thailand 2021” dinner talk held on Thursday by Thansettakij and Krungthep Turakij newspapers at Siam Paragon shopping complex in Bangkok.

“The outbreak has had an especially heavy impact on small and medium businesses, prompting the government to spend over Bt800 billion on SME aid measures including postponing debt repayment worth over Bt6.8 trillion for 12 million SMEs,” he said. “However, from July onwards, economic indicators have been pointing toward an improving, trend thanks to cooperation from all parties in outbreak prevention, despite some minor impact from political situations.

“The tourism industry has shown improvement, with about 30 per cent occupation, jumping from just 6 per cent in April, thanks to the government’s economic stimulus campaigns such as the ‘Let’s Go Halves’ shopping subsidy,” he added. “Through the Thai Credit Guarantee Corporation, the government is also planning to provide an additional Bt150 billion in loans to help small and medium businesses.

“The battle against Covid-19 is not over yet. The government still has many projects in the coming year to boost the economy, attract foreign investors and build infrastructure for future expansion,” the minister added.

“These projects include the construction of 14 Skytrain lines in Bangkok covering 500 kilometres in the next four to five years, larger than London’s Underground, and the infrastructure projects in the Eastern Economic Corridor to support digital technology, 5G and robotics industry.

“It is unacceptable to let Thailand slide back to the period before Covid-19. Since the global economy is changing we must be more proactive in attracting foreign investors, and the agencies responsible for this are the Board of Investment Office [BoI] and Eastern Economic Corridor Office,” Supattanapong said.

“The next step will be to put Thailand on the list of top 10 countries with ease of doing business, which is a goal proposed by five countries who are our major trade partners.”

2021 will be the year of investment

The deputy PM further explained that next year the government will focus on investing in new industries that will help reduce reliance on export and tourism. “Bangkok will be the centre of regional offices of multinational companies, while Thailand’s automotive industry will focus on the manufacturing of electric vehicles [EVs],” he said. “EVs will create other related industries such as smart equipment manufacturing and electricity generating from renewable energy. This will create a great opportunity for Thailand to further invest in community power plants, as well as biomass and solar power plants in Laos.

Thai economy to regain its strength in 2022

The minister predicted that in 2022, the economy will become as strong as, or even stronger than before Covid-19 hit the country. “The economy next year will still require aid from the government despite the availability of Covid-19 vaccine. It should take at least six months for the situation to stabilise, and we should see an upward trend in the economy starting from the second half of the year onwards,” he said.

“Next year the government will also focus on creating economic opportunities at the grassroots level to reduce disparity,” he added. “We cannot give people free handouts, we also need to create new jobs and new businesses that will support existing and future industries.”

Prevent 2nd wave of outbreak at all cost

Supattanapong said the government will not allow the outbreak situation to escalate and lead to a country-wide lockdown for the second time. “The first lockdown had a heavy impact on the economy and required a long time for us to recover,” he said. “We will not let that happen again.

“The government has earmarked Bt3 billion to buy the first batch of Covid-19 vaccines, which will be provided to those in risky groups first,” he added. “Then we will use domestic facilities to produce vaccines for the rest of the population. When the outbreak situation returns to normal, we can expect a full recovery of the economy.”

The Nation Thailand

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