Thai Industry Seeks Government Support Amid Global Trade Uncertainties
BANGKOK – The Federation of Thai Industries (FTI) has expressed a need for enhanced government support to navigate global trade risks, despite a recent uptick in industrial sentiment. According to the FTI, the industrial sentiment index climbed to a 10-month high of 91.6 in January, up from 90.1 in December, influenced by government incentives, robust exports, and a resurgence in tourism.
Industrial Sentiment Surges but Challenges Persist
However, the optimistic sentiment has been overshadowed by uncertainties stemming from U.S. President Donald Trump’s trade policies, which have cast doubt on business confidence. Moreover, the influx of Chinese products and persistent high levels of household debt pose additional challenges to the industry.
“The government has to move a bit faster in implementing safeguards,” said Apichit Prasoprat, vice chairman of the FTI.
Prime Minister Advocates for Economic Stimulus
Prime Minister Paetongtarn Shinawatra underscored the necessity of heightening government investment and job creation initiatives to achieve a 3% growth target for this year. She also called for the Bank of Thailand (BOT) to consider cutting interest rates to alleviate financial pressures on the public.
Earlier, the Prime Minister had indicated a higher growth target of 3.5% for 2025 but acknowledged the urgency of cooperating closely with the BOT.
Economic Growth Lags Regional Peers
Thailand’s economy grew by 2.5% in 2024, falling short of other Southeast Asian nations. Adding to these concerns is the country’s trade surplus with the United States, which could make it a target for potential tariffs under Trump’s administration.
Central Bank’s Policy Review Looms
The Bank of Thailand is set to review its monetary policy on February 26. At its most recent meeting in December, the BOT decided to maintain its interest rates steady following an unexpected cut in October.
Earlier, the Governor of the Bank of Thailand, speaking to Reuters, informed that current interest rates remain appropriate given the high levels of household debt, although economic growth might miss the government’s targets.
NESDC Emphasizes Preparation for Trade Challenges
The National Economic and Social Development Council (NESDC) leadership stressed the importance of thorough preparation to guard against potential repercussions from unstable global trade dynamics.
“If we can prepare well for trade volatility, I believe the Thai economy will grow more than expected,” said Danucha Pichayanan, head of the NESDC.
Despite these preparations, the NESDC maintained its forecasted growth range for 2025 between 2.3% and 3.3%.
Conclusion: Navigating an Uncertain Global Economic Landscape
As Thailand faces these challenges, the FTI’s call for stronger government safeguards highlights the need for cohesive strategies to mitigate risks associated with global trade policies. While industrial sentiment has demonstrated resilience, the ongoing concerns necessitate a robust response from both the government and the central bank to ensure sustainable economic growth.
With the Bank of Thailand’s upcoming policy review and continued government efforts to stimulate the economy, stakeholders will be watching closely to see how these factors shape Thailand’s economic outlook.
Stay tuned for further updates on Thailand’s economic development and policies.
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