Thailand 20250214
Mekong Memo Thailand Weekly: Business, politics, finance, trade & legal news.
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Here is your Mekong Memo Thailand for this week.
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Headlines:
Economic Growth Hinges on Consumer Confidence
US-China Trade War Threatens Thai Industry
Digital Wallet Rules Under Review
Bangkok Property Developers Cut Supply
Spectrum Auction Set for May
Tourism Recovery Gains Momentum
Medical Tourism Push
Entertainment Complex Plans Continue
State Revenue Collection Beats Targets
Baht Performs Under Trade Pressure
Factory Closures Sign of Industrial Strain
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Economic Growth Hinges on Consumer Confidence
Thailand is shooting for a 3.5% GDP growth for 2025, supported by rising consumer confidence, which recently reached an eight-month high. State revenue collections beat expectations, helping support government initiatives like the digital wallet scheme and debt relief programs. Inflation rose to 1.32% in January but is expected to ease throughout the remainder of this year. Despite these positive indicators, challenges such as risks to investor confidence and tariff impacts from US-China tensions are still in play.
Read more: Bangkok Post (Growth), KResearch (Inflation)
US-China Trade War Threatens Thai Industry
Thailand's economy faces is headed into a period of risk from ongoing US-China trade tensions, possibly putting the hurt on as many as 30 industrial sectors. Anticipated Trump-era tariffs could affect Thailand’s $35.4 billion trade surplus with the United States, particularly in electronics and machinery. The government is taking action now to protect supply chains and try to find new markets to mitigate these risks.
Read more: Nation Thailand, Examiner (Tariffs)
Digital Wallet Rules Under Review
The Finance Ministry is looking into changes to cash-out requirements for merchants in their digital wallet scheme. The program's third phase will distribute funds through the “Tang Rat” app to eligible recipients. Current restrictions require tax-registered merchants to make additional purchases to convert digital funds.
Read more: Bangkok Post
Bangkok Property Developers Cut Supply
Bangkok’s residential property market is in flux as land price growth slows, new supply shrinks, and prices rise. Developers are cautious, with fewer project launches being blamed on economic uncertainty, high household debt, and unsold inventory. Residential prices increased in Q4 2024, driven by rising land and construction costs, especially in urban areas, but land price growth in Greater Bangkok hit near-historic lows, an indication of weak investor sentiment. The market outlook remains uncertain, with affordability concerns limiting demand.
Read more: Bangkok Post (Land Price Slowdown), Bangkok Post (Residential Supply Decline), Bangkok Post (Price Increase)
Spectrum Auction Set for May
The National Broadcasting and Telecommunications Commission has scheduled a mobile spectrum auction for May 6, offering six frequency bands totaling 121 billion baht. The 15-year licenses require cybersecurity and data protection plans. AIS and True Corporation are looking like the primary bidders in the wake of recent industry consolidation.
Read more: Bangkok Post
Tourism Recovery Gains Momentum
Foreign arrivals reached 4.8 million by February 9, a 17.1% year-on-year increase. China was in the lead with 825,617 visitors, followed by Malaysia (617,631) and Russia (330,628). Tourism revenue hit 235 billion baht, with daily arrivals averaging 119,630.
Read more: Bangkok Post
Medical Tourism Push
Healthcare authorities are moving forward with plans to make Thailand into an even more important medical hub by 2030. The initiative is said to be a catalyst to move medical tourism to contribute 1.7% of GDP under a 2023-2027 plan. Foreign medical visitors numbers rose from 1.2 million to 3.4 million, while the spa sector recorded 40 million visits.
Read more: Bangkok Post
Entertainment Complex Plans Continue
A draft law to legalize gambling in entertainment complexes across five proposed locations including Bangkok and Phuket is still in the works. The government says that it is targeting $9.1 billion in gross gaming revenue and expects to draw 100 billion baht in investment. Public opposition remains at 60%.
Read more: Astro Awani
State Revenue Collection Beats Targets
Government revenue reached 614 billion baht in Q1 fiscal 2025, exceeding targets by 2.4%. State enterprises contributed 51.9 billion baht, while the Revenue Department collected 470 billion baht. The government is shooting for 2.88 trillion baht in net revenue this fiscal year.
Read more: Bangkok Post
Baht Performs Under Trade Pressure
The Thai Baht, currently Asia's top currency performer with a 2.7% monthly gain, is going to see resistance to further strength due to waning seasonal support and the approach of the off-peak tourism season. Analysts expect a weakening to 36 per dollar in Q2 2025, also due to trade tensions and expected dividend outflows.
Read more: Bangkok Post
Factory Closures Sign of Industrial Strain
More 100 monthly factory closures continued through 2024, the second consecutive year at this level. The manufacturing index dropped 2% in Q4 2024. Reportedly, although each new factory employ an average of 36 workers, each closure results in 52 job losses. SMEs face particular pressure from weak consumer demand and a rising tide of competition.
Read more: Bangkok Post
That’s it for this week, thanks for reading!
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