MPI dips to lowest since 2011
Thailand’s manufacturing production index (MPI) in April stood at 79.04, the lowest level since November 2011.
The drop came mainly from the lockdown and curfew, the drought, private sector wariness of the Covid-19 pandemic continuing and weak confidence in the economy.
Ittichai Yotsri, deputy director-general of the Office of Industrial Economics (OIE), said the global and domestic economic contractions have particularly hit the industrial and manufacturing sectors.
“The government has managed to control the spread of Covid-19 through lockdown measures that also stopped most economic activity and kept people from spending money,” he said.
The OIE said Thailand’s MPI index in April decreased 17.2% year-on-year.
The capacity utilisation rate was 51.9% in April, a decrease from 67.8% in March.
The capacity utilisation rate for the first four months this year was 63.1%.
In the first quarter of 2020, capacity utilisation was 66.7%, down from 71.3% during the same period last year.
Recently the OIE downgraded the MPI for 2020 to a record low of negative 6-7%, with industrial GDP contracting 5.5-6.5%.
The drop is a result of the pandemic, the global economic slowdown, the declining export sector, weak domestic purchasing power and the drought.
Mr Ittichai expects the global and domestic economies in 2020 will not recover if there is no Covid-19 vaccine.
“The economy will take time to recover to the level before the virus, and there are no signs the global or domestic economy will expand in the near future,” he said.
The global spread of the virus has hit the automotive industry and related industries particularly hard, with car sales declining 81.7% year-on-year in April.
The capacity utilisation for car manufacturing plants in April was only 12.6%.
The petroleum industry shrunk by 19.3% because of the drastic reduction in air and land travel, as well as low oil prices. Beer sales fell 82.4% because of the government ban in April.
The OIE suggested the industrial sector adjust its operating production for the new era.
‘‘ There are no signs the domestic or global economy will expand in the near future. ITTICHAI YOTSRI Deputy director-general, OIE