Trying times: Food vendors wait for customers at the Or Tor Kor market in Bangkok. Thailand has downgraded its 2025 economic forecast due to uncertainty over trade tariffs threatened by US President Donald Trump. — AFP
BANGKOK: The Thai business sector is increasingly concerned about the nation’s political instability, fearing it could erode investor confidence and further weaken the already fragile economy.
Business leaders are calling on the government to avoid implementing socially sensitive policies and instead focus on short-and long-term measures to stimulate purchasing power and invest in infrastructure, rather than relying on ineffective cash handouts.
Thailand’s economy is currently facing multiple risks, both domestically and internationally, including a slowdown in economic growth, trade wars, currency volatility, and political uncertainty.
These factors directly impact investor confidence and could exacerbate the economic downturn.
Sunthorn Sathaporn, President of the Housing Business Association, stated that Thailand’s economic situation has yet to show clear signs of recovery, particularly in the capital market, which lags behind other Asean countries.
This reflects declining investor confidence, necessitating cautious and prudent government policies to avoid long-term instability.
Sunthorn emphasised that previous cash handout schemes, such as those targeting teenagers or the general public, have proven economically inefficient and have drawn public criticism, potentially undermining confidence in the government.
He also cautioned against pursuing socially sensitive policies, like establishing entertainment complexes with casinos, without comprehensive public consultation, as this could lead to political backlash and broader instability.
Despite global stock markets showing signs of recovery, Thailand’s capital market remains sluggish, indicating that investors are primarily concerned with domestic factors.
Sunthorn suggested that the government should revise its economic stimulus plans to focus on large-scale infrastructure projects, such as the dual-track railway and the Bangkok-Nakhon Ratchasima high-speed train.
These projects could help distribute economic growth to regional areas and stimulate the real estate sector outside Bangkok.
Another significant proposal is to consider enacting legislation to collect windfall taxes from areas that benefit from government infrastructure investments, such as electric trains, dual-track railways, airports, and expressways.
This would provide a sustainable source of revenue beyond traditional tax collection methods.
Additionally, there is a suggestion to expedite the enactment of “property rights-based” laws and extend land lease rights from 30 to 60 years to encourage long-term investment and address concerns over the use of “nominees” in the real estate sector, which remains a point of contention in the economic system.
Suphajee Suthumpun, CEO of Dusit Thani Public Company Limited, noted that the tourism industry is directly tied to investor confidence. If the parliament is dissolved and new elections are called for justifiable reasons, it may not impact tourism.
However, if the dissolution stems from concerning reasons, it could negatively affect the tourism sector.
Regarding potential changes in the Tourism and Sports Minister, Suphajee believes that while the tourism sector is driven by multiple agencies, including the private sector, any change in leadership should ensure continuity and effective policy implementation.
The government is currently promoting the development of entertainment complexes, including casinos, which, if successful, would take four to five years to complete.
However, the immediate challenge facing Thailand’s tourism industry is the decline in demand from Chinese tourists, the country’s largest market. Efforts should focus on targeted marketing to address this issue promptly.
In April, the number of foreign tourists visiting Thailand decreased, prompting the Tourism Authority of Thailand to revise its 2025 target from 38-39 million to 35.5 million visitors. — The Nation/ANN
