In a welcome development for Thailand’s economy, the industrial confidence of the nation saw an upswing in June after three months of decline. The rise was attributed to the sustained growth in domestic demand, fueled by the recovery in private consumption and tourism sectors, as per data revealed on Monday.
The Thailand Industry Sentiment Index (TISI) demonstrated a positive trajectory, increasing to 94.1 in June from 92.5 in May, with all components of the index showing improvement. Notably, purchase orders, sales, production volume, operation costs, and turnover all contributed to the rise, according to the Federation of Thai Industries (FTI).
While June brought encouraging indicators, entrepreneurs expressed their apprehensions about certain challenges that could impact the economic landscape. High household debt remained a concern, affecting the overall purchasing power of consumers. Additionally, sluggish exports persisted due to weak global demand, and geopolitical conflicts continued to impact energy and commodity prices, the FTI reported in a statement.
The three-month expected TISI, reflecting predictions for the near future, dropped to 102.1 in June, a five-month low from 104.3 a month earlier. Entrepreneurs voiced worries about the domestic political situation and uncertainties surrounding the formation of a new government.
To address these issues and bolster economic growth, the FTI called upon the government to take specific actions. Increasing the number of inbound flights was highlighted as a crucial step to support the recovery of the tourism sector. Emphasizing security, the FTI urged the authorities to enhance the overall experience for tourists. The organization also recommended organizing events that would enable entrepreneurs to promote and sell tourism-related products to overseas visitors, aiming to boost the tourism industry further.
Furthermore, the FTI Chairman, Kriengkrai Thiennukul, emphasized the necessity of efficient management of agricultural and industrial water supplies in light of the ongoing El Nino-related drought, which is projected to have a prolonged impact on various sectors.
The data for the industrial confidence reading was gathered through a comprehensive survey involving 1,361 respondents from 45 industry groups affiliated with the FTI.
As Thailand continues to navigate economic challenges and capitalize on opportunities, policymakers and industry leaders are working hand in hand to sustain the positive momentum of domestic demand while addressing concerns that could hinder the nation’s path to recovery.