The easing of coronavirus-related lockdown measures in June led to business sentiment rising in Thailand for the first time in 14 months.
According to the University of the Thai Chamber of Commerce (UTCC), business confidence in the country rose to 31.5 in June from 31.3 in May, after registering 32.1 in April, 37.5 in March, 44.9 in February and 45.4 in January.
The UTCC cautioned that Thailand’s overall economic prospects remain a cause for concern, due to the blow to employment arising from the coronavirus crisis and said business confidence is likely to rise if the government speeds up disbursement of the social and economic rehabilitation budget in the third quarter.
Thailand’s government recently approved a budget allocation of 100 billion baht ($3.2 billion) for the first phase of the 400 billion baht ($12.79 billion) spending plan for social and economic rehabilitation. The budget has targeted job-creation and strengthening the country’s farming sector. The second phase of the budget is valued at 300 billion baht ($9.59 billion).
The Thai cabinet approved five projects worth 15.5 billion baht ($500 million) proposed under stimulus packages altogether worth 400 billion baht. One of the schemes, a One Tambon, One New Theory Cluster project, is worth 9.8 billion baht ($310 million) and focuses on increasing farmers' income and employment. (A tambon is a local governmental unit in Thailand, below a district and a province, a tambon forms the third administrative subdivision level.)
One of the projects, worth 4.7 billion baht ($150 million), aims to increase farmers' income and employment, while another, worth 169 million baht ($5.4 million), involves developing the soil and fertiliser businesses.
Based on UTCC estimates, spending in the first phase of the rehabilitation budget will help stimulate growth by 0.3-0.5 percentage points.