Thailand 20241129: Observant, Educational, Superfluous
Mekong Memo Thailand Weekly: Business, politics, finance, trade & legal news.
Business stories from Southeast Asia directly to your inbox every week.
The Mekong Memo is proudly presented by:
Horton International is your premier partner for executive search in Southeast Asia. Whether you're a small startup or a global corporation, our reliable and effective recruiting solutions are tailored to meet your unique needs. With extensive experience and offices across the region, we excel at overcoming recruitment challenges and securing top talent for your organization.
Click here to learn how Horton can make your life easier.
Here is your Mekong Memo Thailand for this week.
As a reminder, you can adjust which country versions of The Memo you would like to receive by adjusting your settings here.
Headlines:
Economic Growth Forecast Revised Upward
Tourism Drives Phuket Economic Engine
Auto Sector Hits Speed Bump
Property Market Mixed Signals
Banking System Maintains Strength
Medical Costs Expected to Rise
Singapore PM Visit Strengthens Ties
Investment Environment Takes Shape
Retail Sector Shifts From Prices to Stories
Cross-Border Bus to Cambodia Service is Back
Air Force Rebrands for Space Age
Streaming Platform Competition Heats Up
Forest Rangers Upgrade to Submachine Guns
Refer three friends and receive a full paid subscription to The Memo for one month absolutely FREE:
Economic Growth Forecast Revised Upward
The economy shows signs of improvement with GDP growth projected at 3% in 2025, up from 2.6% in 2024. The University of the Thai Chamber of Commerce is crediting this to government spending, tourism recovery, and a rebound in exports. Factory output dropped 0.91% year-on-year in October 2024, better than expected, with the industry ministry forecasting growth between 1.5% to 2.5% in 2025. High household debt continues to hold back domestic spending.
Read more: Bangkok Post (GDP Growth), Bangkok Post (Factory Output)
Tourism Drives Phuket Economic Engine
Phuket is expecting 16 million tourists in 2024, a new high-water mark above the numbers we saw pre-pandemic. Tourism revenue should reach 500 billion baht, putting the island on par with other global hotspots like Miami and Dubai. The tourism growth is increaseing demand for residential and investment properties, but domestic tourism is facing pressure from rising consumer loans and mortgage defaults, with locals cutting travel spending and high-income travelers preferring to choose international destinations.
Read more: Bangkok Post (Phuket Growth), Bangkok Post (Domestic Tourism)
Auto Sector Hits Speed Bump
The automotive sector is battling with weak consumption. New passenger car registrations dropped 27.4% year-on-year in October. The government's car trade-in program is facing criticism from manufacturers as not going far enough to address the sales slump. Industry stakeholders are hoping that the Thailand International Motor Expo will give a much needed lift to this year’s tepid sales performance.
Read more: Bangkok Post (Sales Drop), Bangkok Post (Trade-in Plan)
Property Market Mixed Signals
Bangkok's luxury property market shows strength with SCOPE Langsuan seeing the city's highest rental rate at 2,500 baht per square meter monthly. Property Perfect has cut its 2024 presales target by 50% to 8.2 billion baht and revenue projections by 20% to 8.8 billion baht. JLL Thailand is forecasting double-digit growth in 2025, mostly driven by hotel transactions and land deals.
Read more: Bangkok Post (Luxury Rentals), Bangkok Post (Developer Outlook), Bangkok Post (Market Growth)
Banking System Maintains Strength
The Bank of Thailand reports strong capital, loan-loss provisions, and liquidity in the banking system. Q3 2024 loan growth shrunk 2.0% year-on-year due to high debt repayments. New lending continues to large corporations in service, real estate, and trade sectors, along with consumer loans for personal and mortgage lending.
Read more: Bangkok Post
Medical Costs Expected to Rise
Medical costs in Thailand will rise by 15.2% in 2024 and 14.2% in 2025. The increase is being blamed on a delay of routine care during the pandemic leading to more complex treatments being required now. Increased infection rates, particularly among children with reduced exposure to normal viruses during lockdowns, have also apparently driven up costs across all age groups.
Read more: Bangkok Post
Singapore PM Visit Strengthens Ties
Singapore Prime Minister Lawrence Wong's first official visit to Thailand included meetings with Prime Minister Paetongtarn Shinawatra. Discussions covered food security, energy security, green economy initiatives, and digital connectivity. The visit marks Paetongtarn's first time hosting a foreign head of state.
Read more: Bangkok Post
Investment Environment Takes Shape
The Finance Minister has identified three key requirements from foreign investors: access to developed land at reasonable prices, a green electricity supply, and sufficient skilled labor. The Commerce Minister met with US-ASEAN Business Council representatives to look at trade opportunities, trying to talk up Thailand's central location, infrastructure and potential as a regional manufacturing hub.
Read more: Khao Sod English (Investment Factors), Nation Thailand (US Investment)
Retail Sector Shifts From Prices to Stories
Central Retail Corporation is trying to adjust its marketing strategy toward equity and sustainablity campaigns, instead of traditional price promotions. It remains to be seen if this strategy will resonate with the buying public. Gourmet Market says that it is planning 1-2 new store openings annually, targeting high-income consumers. The company will introduce Smart Cart technology at premium locations while renovating existing stores to expand restaurant spaces.
Read more: Bangkok Post (CRC Strategy), Bangkok Post (Market Expansion)
Cross-Border Bus to Cambodia Service is Back
Thailand and Cambodia have restarted bus services connecting Bangkok with Phnom Penh and Siem Reap, the first resumption since COVID-19. Services operate through Sa Kaeo province's Aranyaprathet checkpoint.
Read more: Bangkok Post
Air Force Rebrands for Space Age
The Royal Thai Air Force plans to rebrand as the Royal Thai Air and Space Force and establish a National Air and Space Interests Coordination Center. The changes will require legislative approval and should be wrapped up by 2028.
Read more: The Diplomat
Streaming Platform Competition Heats Up
Media experts are calling for a domestic video streaming platform to compete in the 14 billion baht annual market, somehow believing that competition with Netflix is both feasible and desirable. One-third of Thais access streaming platforms, with 52% watching more than six hours (!) daily.
Read more: Asian News Network
And now for something completely different.
While the focus of The Memo is on news for business, we often wrap up with a less business-focused article or two. Forest rangers are getting loaded for bear:
Forest Rangers Upgrade to Submachine Guns
Thailand’s Royal Forest Department has got their hands on 20 NIN9 submachine guns for the protection of 32 million rai of forest land. The weapons, developed domestically, are designed for durability in harsh conditions and cost less than imported alternatives. The department says that it plans more purchases pending successful field use. Reportedly, the new firearms purchase is in support of domestic defense manufacturing and will help to improve forest rangers’ ability to combat encroachment and illegal logging.
Read more: Bangkok Post
That’s it for this week, thanks for reading!
How are we doing?
We love hearing from readers, and we are always looking for feedback. How are we doing with the Mekong Memo? Is there anything you'd like to see more of or less of? Which aspects of the newsletter do you enjoy the most?
Your voice matters to us. Feel we're missing something? Have additional sources to suggest? Don't hold back— hit reply and help us get better. We'd love to hear from you!
If you value the Mekong Memo, please consider buying (or gifting!) a paid subscription, sharing it on social media or forwarding this email to someone who might enjoy it. Please also “like” this newsletter by clicking the ❤️ below, which helps us get visibility on the Substack network.
Thank you!