May MPI up 7.64% due to reopening

Thailand’s Manufacturing Production Index (MPI) in May rose by 7.64% from the preceding month to 98.05 points thanks to the reopening of the country, but the index slightly decreased by 2.11% year-on-year.

Industry Minister Suriya Jungrungreangkit attributed the increase to further relaxing of travel restrictions that led to more tourist arrivals, as well as easing of other Covid-19 measures.

The reopening of the country helped increase the number of foreign visitors, eventually boosting business activities and the domestic economy.

During the first five months of this year, the MPI increased by 0.75% to 101.08 points.

In May, capacity utilisation stood at 62.4%, up from 58.5% in April.

The government expects the prolonged semiconductor shortage, which is affecting domestic car manufacturing, to recover, believing it will deal a blow to the Thai industrial sector only in the short term.

“Lockdown measures in China will be a major factor that affects the economy. The government is closely monitoring the situation,” said Mr Suriya, referring to Beijing’s zero-Covid policy.

Siripen Kiatfuengfoo, deputy directorgeneral of the Office of Industrial Economics, said the lockdown in China’s port cities affected global supply chains and caused the MPI to decrease by 2.11% from 100.17 points in May last year.

“The government expects China to relax lockdown measures to ease the impact on global supply chains,” she said.

Authorities will also keep a close watch on the Russia-Ukraine war, blamed for causing global oil prices to soar, said Ms Siripen. Industries that contributed to the higher May MPI include petroleum, electronics and circuit boards.