JSCCIB predicts GDP to contract by 0.5% to 1%

JSCCIB predicts GDP to contract by 0.5% to 1%

The Joint Standing Committee on Commerce, Industry and Banking (JSCCIB) has said that Thailand can expect a drop in GDP of 0.5% to 1% if the government is able to control the new Covid-19 wave by April or May, respectively.

Despite a slight decrease of daily infections from the record-high 1,767 cases last Sunday to 1,394 new infections yesterday, the 1,000-plus infection rate per day is worrying JSCCIB as it will deal a further blow to the already reeling economy.

"The third wave will certainly have a strong impact as many businesses cannot operate normally while people who have been told to work from home are worried about spending," said Kriengkrai Thiennukul, vice-chairman of the Federation of Thai Industries (FTI).

"Both purchasing power and employment will be affected."

The JSCCIB is scheduled to meet tomorrow and it will likely downgrade its 2021 economic growth forecast for Thailand, mostly due to a plunge in public spending.

Earlier, the group estimated the country's GDP would grow by 1.5-3.5% this year with exports expanding by 3-5% and an inflation rate of 0.8-1%. The predictions were based partly on the state's economic stimulus packages.

Mr Kriengkrai urged the government to speed up Covid-19 vaccine distribution as well as introduce new measures to boost the economy.

"The FTI expects to see the government roll out vaccines to a number of people during the third quarter and cover 70% of the Thai population. This is a way to achieve herd immunity," he said.

Success in solving slow vaccination progress will be a key part of economic restoration and it will allow Thailand to fully resume business activities and build confidence among foreign tourists.

Many small and medium-sized enterprises with limited budgets also need help as they have been hit hard by the pandemic, said FTI.

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