Modern trade index fell in Q4 of 2020

Modern trade index fell in Q4 of 2020

Mr Thanavath predicts modern trade sentiment would stay relatively low during the first quarter of this year.
Mr Thanavath predicts modern trade sentiment would stay relatively low during the first quarter of this year.

Modern trade sentiment remained downbeat in the fourth quarter last year, falling to a two-year low as operators were concerned about the crisis and the relatively weak purchasing power among local consumers.

Thanavath Phonvichai, vice-president of research at the University of the Thai Chamber of Commerce (UTCC), said the modern trade sentiment index stood at 47.3 points out of 100 in the final quarter of 2020, slightly lower than 47.4 points in the third quarter.

Modern trade is estimated to represent about 66.3% of the country's wholesale and retail market.

"Businesses operators fretted over a second outbreak in Thailand, which resulted in the cancellation of New Year festivities and hotel reservations later in the year," said Mr Thanavath.

"Sentiment is unlikely to rebound soon and overall modern trade prospects may continue slowing in the future because of high economic and political uncertainties and lingering concerns on the weak purchasing power of the overall local consumers."

He predicted modern trade sentiment would stay relatively low in the first quarter of this year, citing lower profit and income affecting not only production costs but also cash flow, investment plans and employment.

"Sentiment recovering will count on effective control of the outbreak and economic stimulus packages," said Mr Thanavath.

He said business operators have proposed the government speed up efforts to control the outbreak and continue rolling out aid measures for the overall retail and service sectors, particularly through extensions of utility fee reductions and corporate income tax claims for expenses incurred from spending in healthcare to curb the spread of infections.

The government is being urged to rev up revitalising the tourism sector and allow retailers to participate in state-sponsored aid schemes.

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