JSCCIB predicts Q4 recovery amid jabs
The Joint Standing Committee on Commerce, Industry, and Banking (JSCCIB) expects the Thai economy to pick up in the fourth quarter this year -- faster than earlier projections of the first quarter of next year -- if the government can maintain momentum of its vaccine programme.
The country's mass vaccination rollout, which began on Monday, has been showing good signs. In case the government can manage to vaccinate the country according to its target, it would build people's confidence and lead to an increase in economic activity and fast recovery of the Thai economy, chairman of the Thai Bankers Association (TBA) Payong Srivanich said after a private council meeting yesterday.
Moreover, government economic stimulus packages such as the "Khon La Krueng" co-payment and "Ying Chai Ying Dai" (the more you spend, the more you get) schemes will also support domestic consumption. This will help build confidence in people and business operators.
The private sector committee has also asked the government to increase cash handouts under the third-phase of the Khon La Krueng scheme -- which is scheduled to begin in July -- to 6,000 baht per person, up from 3,000 baht per person originally. The JSCCIB plans to discuss the issue with the Finance Ministry to empower people to spend.
"Mass vaccinations, the Phuket sandbox scheme, and economic stimulus measures will help increase economic activity in the fourth quarter, which was previously only expected to happen in the first quarter of next year. Given the heavy impact of Covid-19, quick economic recovery would benefit both people and businesses significantly," he said.
Mr Payong said the Bank of Thailand debt restructuring measures include an asset warehousing scheme to help to ease borrowers debt burden.
However, the TBA plans to propose the central bank to adjust conditions in the asset warehousing scheme to simplify the programme to allow more operators to join it. At the same time, banks need to spend more time understanding needs of business operators as part of a new financial aid scheme.
The central bank's amended-soft loan scheme worth 250 billion baht will support liquidity of business operators, in particular small and medium-sized enterprises (SME), and help them overcome the crisis and control non-performing loans (NPLs).
The debt restructuring and soft loan programme will help contain bad debt, especially of SMEs, in the next three to four months as the economy picks up.
Four business operators, which account for total loan outstanding value of 1 billion baht, are participating in the asset warehousing programme. Meanwhile, the central bank has approved 20.84 billion baht worth of soft loans to 8,218 business operators as of May 31.
Apart from vaccinations, the private sector wants the government to contain new clusters of infections, especially in areas with manufacturing and supply-chain activity.