Consumer confidence last month improved for the first time in 14 months and to the highest level in four months on anticipation of cool-headed politics after the military stepped in pull the country out of a year-long recession due to the domestic conflic
"The public realises that the political crisis has passed and the economy is recovering. Spending may continue to rise in the third quarter and beyond," Thanavath Phonvichai, director of the Economic and Business Forecasting Centre at the University of the Thai Chamber of Commerce, said yesterday.
The university’s index-measuring sentiment advanced to 70.7 in May from 67.8 in April. The index tracked a nationwide survey of 2,251 respondents.
The recent improvement in the political outlook helped boost confidence, so the economy has a good chance of achieving growth of 2-3 per cent this year.
The National Council for Peace and Order’s measures to stimulate the economy through many projects, as well as the acceleration of Bt90 billion in payments to farmers for their pledged rice will help buoy consumer confidence and spending.
The NCPO’s economic enhancement packages will help add 1-1.5 percentage points to GDP growth this year as Bt200 billion-Bt300 billion is injected into the economy.
Isara Vongkusolkit, chairman of the Board of Trade of Thailand and the Thai Chamber of Commerce, said rosier consumer confidence was cheering up businesses.
"With higher consumer purchasing power, businesses will have more confidence to expand and invest," he said.
To raise confidence among foreign companies and investors in the country after the coup, the chamber will host the "Get Together with International Friends 2014," roundtable on Tuesday at the Four Season Hotel.
Ambassadors, consuls and foreign investors from various foreign chambers of commerce would be invited to discuss how to raise their confidence and increase their understanding of Thailand’s politics and economic fundamentals.
The chamber has also prepared a strategy for sustainable economic development for the consideration of the military brass. Plans include reforming agriculture by demarcating zones for cash crops, bridging the income gap and promoting trans-border trading.
The chamber also called on agencies to eliminate barriers to trade and investment in the country.
Saowanee Thairungroj, president of the university, said the auto, housing and tourism industries as well as small and medium-sized investors would enjoy better growth this year, thanks to recovering consumer confidence.
Last month, other confidence indices, particularly those concerned with the future outlook, also rose.
Consumer confidence in the future climbed from 72.3 in April to 75.8 points last month, in future employment opportunities from 61.9 to 64.2 points and in future income from 83.8 to 87.1 points.
Confidence in the political situation also rose for the first time in 14 months, and touched its highest level in eight months since last October. It jumped from 37.3 points in April to 59.6 points in May.
The gross domestic happiness index also took a big step up from 61.2 points in April to 71 points last month.