WVB's محتوى الأخبار

» The Business Confidence Index slightly increased 1 point In the First Quarter of 2024.

1st May 2024, Siam Ratings Agency Company Limited (SRA) announced the result of the survey about WVB Business Confidence Index in the First quarter of 2024.

SRA Co., Ltd. conducts the survey quarterly. The main objects of the survey are companies which have the most well-known brand, the largest number of Total Assets, Total Revenues, and Employees. Being performed from the early of April 2024 to the late of April 2024, the survey attracted 150 Companies which active in many different fields in Thailand, such as Agriculture, Automotive, Construction, Technology, Energy, Electronics, Telecommunications, Services… In particular, large and medium enterprises accounted for over 95% of total enterprises participating in this quarter.

According to the survey, the Business Confidence Index (BCI) in the First quarter of 2024 reached 128 points, a slight increase of 1 points compared to the Fourth quarter of 2023 (127 points). This index indicates that companies in Thailand have a positive perspective on the current economic situation. However, despite this sentiment, most companies express confidence that the Thai economy will improve in the upcoming phase. Furthermore, there are several enterprise that believe the current economy is highly volatile and challenging to predict due to the fluctuations in the global economy.

Summary of investigation results of 6 components building Business Confidence Index (BCI) in the First quarter of 2024 as follows:

- On the general economic situation of Thailand today:
Only 49.33% of enterprises participating in the survey said that Thailand's overall economy is now better than 12 months ago, 42.67% of enterprises said that the economic conditions of Thailand remained the same. 8.00% of enterprises said that economic conditions were somewhat worse than 12 months ago.

According to the Shareholder Newsletter from Kasikorn Research Center (KResearch), Thai Economy Projected to Remain on the Recovery Path in 1Q2024, Supported by Tourism and Exports Amid the Increased Risk Surrounding the Global Economy.

The US economy continued to grow at a robust pace during 3Q2023 although it is projected to slow down in 4Q2023 amid more stringent lending criteria there in line with tighter monetary policy, and the “higher for longer” stance of the US Federal Reserve (Fed) towards its policy rate. However, the US inflation rate and key US economic figures, particularly nonfarm payrolls and home sales, have begun to decline. Meanwhile, the Eurozone economy remained sluggish due to the shrinkage of its 3Q2023 economy. The Eurozone Manufacturing Purchasing Managers’ Index (PMI) has contracted since July 2022. Meanwhile, its policy rate, which is at a record high of 4.0 percent continues to pressure financial conditions of its consumers and entrepreneurs.

- Prediction of Thailand general economic situation in the next 12 months:

 49.33% of enterprises believed that Thailand’s economy would be better in the next 12 months, 50.67% said that the economy would remain unchanged, and 0.00% of businesses are worried about Thailand’s economy in the future.

According to the Shareholder Newsletter from Kasikorn Research Center (KResearch), The Thai economy is projected to be supported by the steady recovery in tourism and exports in 2024, but close attention must be paid to the government’s economic stimulus measures.

The Thai economy grew less than expected at 1.5 percent YoY, pressured primarily by steady decline in the export sector and public consumption in line with dwindling spending related to COVID-19, and the delay in preparing the 2024 budget. Given this, KResearch has downwardly revised its growth forecast for the Thai economy in 2023 to 2.5 percent YoY, against the previous estimate of 3.0 percent.
However, it is expected that the Thai economy in 1Q2024 will rebound in line with tourism and exports, while the government will continue to freeze most energy prices, including cooking gas (LPG), until at least the end of 1Q2024. Nevertheless, the fuel adjustment tariff rate, known as Ft, may increase from the current round (September-December 2023). Such energy subsidies may help ease the rising costs in the household and business sectors somewhat.

In 2024, KResearch views that the Thai economy may perform better than that in 2023 as tourism will continue to be a key economic driver despite its slower growth momentum. KResearch expects that the number of international tourist arrivals in Thailand will reach roughly 30.6 million, an increase from the 27.6 million projected for 2023. Thai exports may recover at a meagre pace to a positive territory, thanks partly to the low base of 2023. KResearch projects that 2024 exports will expand approximately 2.0 percent, an increase over the contraction of 1.3 percent projected for 2023. Thailand’s outward trade may recover under the risks to the global economy, particularly China, and uncertainties surrounding erratic weather conditions, plus ongoing geopolitical issues. Internal factors, including the government’s economic stimulus measures, which are expected to be implemented in 2024, will primarily help shore up domestic consumption amid the rising cost of living and hefty household debt
that have dampened consumer purchasing power.

In summary, it is expected that the Thai economy will continue to bounce back in 1Q2024, supported by higher growth in tourism and exports. However, the delay in preparing the 2024 budget will continue to pressure the Thai economy during this quarter. For 2024, KResearch projects that the Thai economy will grow 3.1 percent YoY.

- Plans to use employees:

In the survey: 46.67% of enterprises expected to raise human resources; 50.00% of enterprises planned to remain and 3.33% of enterprises will reduce the number of employees in the future.

According to The National Economic and Social Development Council of Thailand (NESDC),  The labor situation throughout 2023 continued to improve. Working hours increased, and unemployment continued to decline. However, prioritization should be placed on the progress of going future industries’ restruction, persistent labor shortages, particularly at the vocational and high-vocational certificate levels, along with the development of AI skills for workers.

 The total employed population was 40.3 million, increasing by 1.7 percent from the same period last year. Employment in the agricultural sector expanded by 1.0 percent, while non-agricultural sectors increased by 2.0 percent, particularly in the hotels and restaurant sectors with an 8.0 percent growth attributed to a rise in foreign tourists. Simultaneously, employment in the transportation/storage, wholesale/retail, and construction sectors increased by 4.5 percent, 3.8 percent and 3.1 percent, respectively. However, the manufacturing contracted by 2.3 percent due to a slowdown in production of important industrial products. Working hours showed improvement. The average weekly working hours for the overall and in the private sector were 42.6 and 46.9 hours, respectively. This was in line with a reduction in underemployed and hidden-unemployed individuals by 23.6 and 6.8 percent, respectively. Average monthly wages in private sectors were at 14,095 baht per person per month. increased by 0.9 percent, while the overall was at 15,382 baht per person per month, decreased by 0.2 percent.

- Investment plans for fixed assets:

60.00% of surveyed businesses planned to invest more costs for fixed assets, 38.00% of these still have no plan and 2.00% planned to reduce the cost for fixed assets in the next 12 months.

- The belief in revenue growth:

72.00% of participating enterprises were confident of an increase in sales, 27.33% of enterprises said that the revenue would remain and 0.67% business is concerned about the number of sales going down in the next 12 months.

- The belief in profit growth:

72.00% of enterprises believed that profit would rise in the following year, 27.33% of enterprises believed that profit would remain and 0.67% business is concerned about the number of Profit going down in the next 12 months.

According to The National Economic and Social Development Council of Thailand (NESDC), The Thai Economic Outlook 2024.

The Thai economy in 2024 is projected to expand in the range of 2.2 – 3.2 percent (with the midpoint of 2.7 percent). Key supporting factors include: (1) the return to an expansion of exports of goods in line with the global economic recovery; (2) the favorable growths of private consumption and private investment; and (3) the continual recovery of tourism sector. Private consumption expenditure and private investment are expected to increase by 3.0 percent and 3.5 percent, respectively. Meanwhile, export value of goods in US dollar terms is anticipated to expand by 2.9 percent. Headline inflation is estimated to be in the range of 0.9 - 1.9 percent and the current account is projected to record a surplus of 1.4 percent of GDP.

Key components of Economic growth;

Total consumption: (1) Private consumption expenditure is expected to increase by 3.0 percent, continuing from a 7.1-percent satisfactory growth in 2023, owing to a robust labor market and higher consumer confidence, together with diminish inflationary pressures. However, this was a slight downward revision from a 3.2-percent growth in the previous estimation, due to expected lower income base from exports and industrial production, both of which were also revised downward from the previous estimation. (2) Government consumption expenditure is projected to expand by 1.5 percent, compared with a 4.6-percent reduction in 2023, and a downward revision from a 2.2-percent growth in the previous estimation. The adjustment was in line with the lower current budget remaining in the last three quarters of FY2024, following an acceleration of disbursement in the first quarter.

Total investment is expected to increase by 2.5 percent, accelerating from a 1.2-percent growth in 2023. (1) Private investment is estimated to increase by 3.5 percent, continuing from a 3.2-percent growth in 2023, and an upward revision from a 2.8-percent growth in the previous estimation. This was in accordance with a rise in both investment promotion application and certificate issuance along with a rebound in imports of capital goods, raw materials and intermediate goods.(2) Public investment is anticipated to decline by 1.8 percent, consistent with the previous estimation, and continuing from a 4.6-percent decrease in the previous year, owing to a delay in the FY2024 annual budgetary process and a downward revision in disbursement rate of the State-Owned Enterprises’ investment budget.

About World Vest Base

Established in 1985 in Chicago, USA, World' Vest Base (WVB) has become the world’s leading global provider of financial fundamentals serving the research and analytic needs of thousands of top companies in the financial services, media and corporate markets. The WVB global database is the financial industry’s premier source of detailed and transparent financial statement data on public companies. The database universe spans over 50,000 public companies over 130 countries from Asia, Africa, Australia, Europe, Latin America and North America. WVB Regional databases also cover hundreds of thousands of private companies in Thailand, Vietnam, Laos, Cambodia, Malaysia and Egypt. WVB also provides databases with Insider & Major Shareholders Transactions, specialized End-of-Day pricing for emerging markets and worldwide credit risk and business risk scoring

Further information can be reached at the company’s official website:    
http://www.siamcr.com

Execution unit:
Siam Ratings Agency Company Limited.
78/11-12 Moo 5, Sub-District Angsila,
District Meuang Chonburi 20000, Thailand.

Website: http://www.siamcr.com
Tel: (+66) 38 397 457.