Business sentiment rose for the third straight month in August, the highest in 12 months, boosted by the relaxation of coronavirus lockdown measures, higher farm product prices, and a recovery of sales for pickups, electrical appliances and agricultural machines.
The University of the Thai Chamber of Commerce (UTCC) said yesterday business confidence rose to 32.6 in August from 31.8 in July and 31.5 in June, which was the first increase in 14 months.
This followed readings of 31.3 in May, 32.1 in April, 37.5 in March, 44.9 in February and 45.4 in January.
The May figure was a 29-month low dating to January 2018.
Thanavath Phonvichai, UTCC president, said higher business sentiment stemmed largely from the easing of the outbreak, the relaxation of rigid lockdown measures, higher crop prices for oil palm, rubber, rice and maize, and rising sales of agricultural machines, pickups, electrical appliances and mobile phones.
Retail sales also picked up, all positive signs of a gradual economic recovery, said Mr Thanavath.
"Business people agree the economy bottomed out in the second quarter," he said.
"They are bullish on the economy getting better thanks to the government's myriad stimulus measures covering tourism and job creation."
The National Economic and Social Development Council (NESDC) said on Sept 9 the second phase of the state's 400-billion-baht spending plan for social and economic rehabilitation is set to finance new projects aimed at strengthening the farming sector and creating more jobs.
The second phase worth 90-100 billion baht aims at revitalising the economy in the final three months this year and the first quarter next year, focusing on job creation, boosting tourism, and upskilling and reskilling programmes for workers in automotive, digital, automation and other targeted industries.
The cabinet in July approved a budget allocation of 92.4 billion baht for the first phase of the plan, expected to create 410,000 jobs.
The cabinet approved 45.1 billion baht to finance 69 projects in the first phase, with the remaining 47.3 billion scheduled for cabinet approval this month.
The remaining funds in the first phase are allotted mainly for hiring 60,000 university students or/and unemployed persons to conduct surveys and data analysis for village and large-scale farm project development.
However, Mr Thanavath said the private sector remains concerned about overall economic prospects after the NESDC reported last month the GDP shrank 12.2% year-on-year in the second quarter, the biggest contraction since the Asian financial crisis of 1997-98.
A sharp decline prompted the government's planning unit to downgrade the economic outlook for the whole year to a 7.3%-7.8% contraction from an earlier contraction of 5%-6%.
It also cut the projection for the export value of goods, private consumption expenditure and total investment to -10%, -3.1% and -5.8%, respectively, from earlier estimates of -8%, -1.7% and -2.1% made on May 18.
The business sector also proposed the government beef up promoting border trade with neighbouring countries to capitalise on rising investment in Cambodia and Laos.
Companies want the government to come up with more measures to stimulate domestic tourism such as additional long holidays and a tax break, while encouraging more seminars to be held in provinces to stimulate tourism and spending on weekdays, he said.