Supant Mongkolsuthree, FTI Chairman, revealed that Thailand Industry Sentiment Index (TISI) for October at 82.1, increased from 79.0 in September 2021. TISI continues to increase over 2 consecutive months in all industry size and region. Almost every component of the index, which comprise of total orders, sales, and production volumes, including turnover, have increased except for manufacturing cost. The supporting factor comprises the COVID-19 situation has improved by the reduction on the infections rate, the increase in proportion of vaccination, and government continues to ease the COVID-19 restrictions has enhanced the economic activities gradually recover. The domestic and international demand for durable and non-durable goods continues to expand, such as automotive, electrical and electronics, machinery, and metalwork industry, and non-durable goods such as food and drug. Moreover, pre-orders for the New Year season in food and fashion goods positively affect the manufacturing, and the government measures also support the domestic purchasing power.
However, TISI remains below 100, indicating that the enterprises' confidence is still poor. Businesses remain concerned that the increase in raw material and fuel price affects production and transportation cost. The fluctuation in the exchange rate impacts the cost of the importer, and exporters remain under pressure due to the container shortage and high freight rates.
The survey, which was conducted in October 2021 from 1,423 enterprises, covering 45 industry chapter nationwide, unveiled factors of concern namely fuel price (70.3%), domestic political situation (54.8%) and loan interest rated (47.5%). While COVID-19 pandemic (60.2%), domestic economy (62.1%), global economy (48.5%), and THB/USD exchange rates in exporters' view (32.8%) helped relaxing enterprise' concerns.
TISI is projected to increase in the next 3 months to 95.0 (from 93.0 in September 2021) due to the fact that entrepreneurs are confident that the gradual easing of COVID-19 restrictions, including the opening up of the country to foreign tourist in low-risk countries with no quarantine from 1 November 2021 and stimulus package will boost economy in the rest of 2021. While export continues to grow in line with global economy.
Recommendation to the Government:
- To expedite vaccination process to meet criteria as mean to create herd immunity, especially in provinces open to tourists to build confidence for domestic and foreign tourists.
- Government should set a plan for the country's reopening, and public health measures include announcing to tourists and people to create understanding.
- To urgently impose more stimulus package and tourism promotion measures as well as relaxation of COVID-19 restriction to improve the economic activities.
- To expeditiously resolve the increase in fuel, raw material, and transportation price issues affecting manufacturing costs.
In this regard, the Federation of Thai Industries (FTI) has complied the survey results of TISI as well as data on economic and industry indicators from various agencies for the past 3 years. It is prepared as a dashboard published on Data Space (iDS) website of FTI to facilitate entrepreneurs and the general public to access useful information in their business operations. You may access the said information service at www.fti.or.th/ids
Source: Federation of Thai Industries