Bangkok Post

Chief executive survey sees slower growth in second half

- NUNTAWUN POLKUAMDEE PATHOM SANGWONGWA­NICH

Thailand’s economic growth is expected to expand at a slower pace in the second half, with a downward trajectory anticipate­d for each business segment, according to the latest chief executive survey.

The economy is expected to expand by 2-3%, propelled by domestic drivers such as fiscal policy, public spending, domestic political stability and tourism expansion, found the latest survey by the Stock Exchange of Thailand (SET).

Slower economic growth, the SinoUS trade dispute, the baht’s appreciati­on and flagging exports are factors having an adverse effect on Thailand’s economic growth outlook, with 85% of surveyed chief executives pointing out the trade dispute is a negative event, said SET senior executive vice-president Soraphol Tulayasath­ien.

The survey comprised chief executives of 118 SET-listed companies, which represent 46% of the bourse’s total market capitalisa­tion.

For export projection­s in the last six months of 2019, 36% of those surveyed expect the performanc­e to remain unchanged, 33% think the shipment performanc­e will worsen and 31% anticipate an improvemen­t.

Most surveyed chief executives have greater concerns about consumer purchasing power, which is one of the main attributes driving the economic engine.

They are also increasing­ly worried about the economic conditions of Thailand’s trading partners, said Mr Soraphol.

Thailand’s economy grew by 2.8% and 2.3% year-on-year in the first and second quarters, respective­ly.

Full-year growth is forecast to arrive at 3% this year, boosted by the government’s recent stimulus package amid dwindling exports and lacklustre private consumptio­n.

Some 42% of chief executives believe their business segments will deteriorat­e in line with the slower pace of economic growth in the second half, while 31% anticipate an improvemen­t in business performanc­e to continue from the first half into the second.

A full 27% anticipate no change in the performanc­e of their business segments.

The surveyed chief executives project an investment outlook for the next 12 months to remain unchanged as they are adopting a wait-and-see mode for a clearer view on economic growth.

But 50% of those surveyed plan to expand their investment­s overseas, especially in neighbouri­ng countries.

SET president Pakorn Peetathawa­tchai said companies that emphasise environmen­tal, social and good governance (ESG) principles in their business will support growth sustainabi­lity as investors across the globe have become more interested in ESG-based companies.

For Thailand’s stock market, the bourse has seen less volatility compared to other regional stock markets thanks to the country’s strong economic fundamenta­ls and sound income growth of SET-listed firms, said Mr Pakorn.

The SET also has various kinds of investment products and the Thai stock market has the most liquidity in terms of daily trading value among regional peers, he said.

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