Thailand 20241018: Cornerstone, Fate, Hippopotamine
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 in here.
Headlines:
PM Courts China on 6G Launch Base
Bank of Thailand in Surprise Rate Drop
Industrial Sentiment Drops to 27-Month Low
Tourism Gains from Rate Cut
Clean Energy Plan to Generate B2.9tn
Minister to Keep Fuel and Power Prices in Check
Finance Ministry Pushes for Higher Inflation Target
Posh Hotels to Increase Rates
Big Investment for Virtual Banks
Sansiri Optimistic About Phuket Market
Thailand Moves Up Semiconductor Value Chain
Expressway Concession Extension Anticipated
Foreign Demand Drives Luxury Condo Launches
Thailand Maintains Place in AP Power Index
New Trade Canal to Transform Global Commerce
WB Lowers Thailand's GDP Growth Forecast
“Moo Deng” Phenomenon Unchecked
Refer three friends and receive a full paid subscription to The Memo for one month absolutely FREE:
PM Courts China on 6G Launch Base
The Prime Minister is looking for Chinese cooperation to establish Thailand as a 6G technology launch base. The move would position Thailand at the forefront of next-generation telecommunications. The PM's efforts go hand in hand with Thai ambition to become a regional tech hub and draw foreign investment in advanced technologies.
Read more: Bangkok Post
Bank of Thailand in Surprise Rate Drop
The Bank of Thailand unexpectedly reduced its policy interest rate by 0.25% to 2.25%, marking the first cut in four years. This move, aimed at easing debt burdens and supporting economic growth, follows a Monetary Policy Committee vote of 5 to 2. The decision comes despite previous market expectations of maintaining rates through the year, and the central bank emphasized that the cut does not signal a prolonged easing cycle. Key growth drivers include tourism, consumption, and improved exports.
Read more: Reuters (market reaction), Khaosod (decision details)
Industrial Sentiment Drops to 27-Month Low
Thai industrial sentiment has fallen to its lowest point in 27 months. The decline is indicative of ongoing economic challenges, including generally global economic uncertainties and domestic political factors. Manufacturers are sharing concerns about production costs, export demand, and overall economic stability. The downturn in industrial confidence could impact investment decisions and economic growth projections for the coming year.
Read more: Reuters
Tourism Gains from Rate Cut
The Bank of Thailand's decision to cut interest rates should be a big benefit to the tourism sector. The rate reduction is hoped to drive domestic spending and make Thailand a more attractive destination to foreign visitors. The tourism industry is forecasting higher visitor numbers and spending as a result of the more favorable economic conditions created by the rate cut.
Read more: Bangkok Post
Clean Energy Plan to Generate B2.9tn
A clean energy initiative is expected to generate nearly 3 trillion baht in economic value. The plan is centered on renewable energy sources and will be necessary for the nation to reduce the its carbon footprint. This ambitious project should create jobs, attract investments, and keep Thailand’s position as a leader in sustainable energy in Southeast Asia. The government sees this as a cornerstone strategy for long-term economic growth and environmental sustainability.
Read more: Bangkok Post
Minister to Keep Fuel and Power Prices in Check
Energy Minister Pirapan Salirathavibhaga has committed to controlling fuel and electricity prices. This pledge to alleviate cost pressures on businesses and consumers will be backed by government exploration of measures to manage energy costs, including subsidies and negotiations with energy producers.
Read more: Bangkok Post
Finance Ministry Pushes for Higher Inflation Target
The Finance Ministry continues to call for a higher inflation target following the recent interest rate cut. This stance is born from a desire to create more room for economic stimulus measures. The ministry says that a higher inflation target would provide greater flexibility in monetary policy decisions, but proposal is a topic of heated debate among economists and policymakers as they argue about the optimal balance between growth and price stability.
Read more: Bangkok Post
Posh Hotels to Increase Rates
Luxury hotels in Thailand are reportedly planning to raise their rates as the tourism sector continues to show signs of recovery and high-end travelers return. Hotel operators are claiming hikes are required thanks to increased operational costs and pent-up demand taking up available room supply. The price increases are expected to primarily affect five-star and boutique properties catering to affluent tourists.
Read more: Bangkok Post
Big Investment for Virtual Banks
The virtual banking sector is set for grab investment. A move towards digital banking reflects changing consumer preferences and tech advancements. Regulatory bodies are putting the finishing touches on frameworks to govern these new financial institutions. The move towards virtual banks is expected to increase (much needed?) competition in the banking sector and improve financial inclusion across the country.
Read more: Bangkok Post
Sansiri Optimistic About Phuket Market
Property developer Sansiri is expressing confidence in the Phuket real estate market. The company says it is seeing strong potential in the island's luxury property segment, thanks both to domestic and international demand. Sansiri says it will launch new projects targeting high-end buyers and investors. The optimism is starting to catch on more broadly across the property market, particularly in popular tourist destinations.
Read more: Bangkok Post
Thailand Moves Up Semiconductor Value Chain
Thailand is moving on up in the semiconductor space with plans for its first front-end fabrication facility in an effort to position the country higher in the global semiconductor value chain. Vietnam has been the regional leader in this area for some time, but the Thai government is providing incentives and infrastructure support to pull investments in this high-tech sector to diversify the economy and become a more important player in the electronics industry.
Read more: Nikkei Asia
Expressway Concession Extension Anticipated
An extension of expressway concessions is expected to facilitate ongoing infrastructure development and maintenance. The extension would allow current operators to continue managing the main expressways while at the same time funding new projects.
Read more: Bangkok Post
Foreign Demand Drives Luxury Condo Launches
Increased foreign demand is spurring new luxury condominium developments in Thailand. Developers are launching high-end projects targeting international buyers and investors, particularly in Bangkok and popular coastal areas. The resurgence in foreign interest is a welcome return to pre-covid norms.
Read more: Bangkok Post
Thailand Maintains Place in AP Power Index
Thailand has retained its 10th position in the Asia-Pacific Power Index. The ranking assesses countries' comprehensive national power across various benchmarks. The stable position is good news for its continued influence in Southeast Asia despite challenges. Usefully, the index shows areas both where Thailand maintains strengths and also identifies opportunities for improvement in its standing.
Read more: Bangkok Post
New Trade Canal to Transform Global Commerce
Thailand is mulling a £21 billion canal project that could revolutionize global trade routes. The proposed "Thai Canal" would be similar in scale and impact to the Suez Canal, potentially reducing shipping times and costs. This megaproject would boost Thailand's importance in international trade and would have huge economic and geopolitical implications for Southeast Asia and global maritime commerce.
Read more: Express
WB Lowers Thailand's GDP Growth Forecast
The World Bank has dropped Thailand's GDP growth forecast for 2024 from 2.8% to 2.4%. This downgrade is a result of ongoing economic challenges and general uncertainties. Factors contributing to the lower forecast include sluggish export performance and regional geopolitical tensions. The revision is a reminder of the continued need for targeted economic policies for growth.
Read more: Nation Thailand
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. If you’re into board games, you need to know about Monopoly Bangkok edition’s launch, otherwise, catch up on your Moo Deng news here:
“Moo Deng” Phenomenon Unchecked
The fame of “Moo Deng,” the pygmy hippo at Khao Kheow Open Zoo, has wildly boosted local business and led to the official trademarking of the hippo's logo. The Zoological Park Organization of Thailand is working to commercialize the brand, partnering with several companies and looking for more. Local vendors, souvenir shops, and even parking services around the zoo have seen a big rise in visitors, particularly on weekends, contributing to the local economy's growth.
Read more: Khaosod English
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!