REGISTER FOR REGULAR UPDATES
DATE AND TIME
Wed, 20 May 2020, 09:00
Wed, 20 May 2020, 10:00
UKABC Political and Economic Update on Thailand
Brian Davidson, British Ambassador to Thailand and Richard Porter, DIT Country Director, will join Baroness Neville-Rolfe DBE CMG, UKABC Chair, to provide insights on the latest political and economic developments in Thailand and a forward look for the rest of the year.
The IMF has predicted that Thailand’s economy will contract 6.7% in 2020, making it the worst performer in Southeast Asia if all things remain the same. A nation of 69 million people, its economy was already showing signs of slowing before the pandemic growing just 2.4% in 2019. The government has responded with robust economic packages amounting to 15% of GDP, among the highest in East Asia and the Pacific according to the World Bank. Despite the many challenges, the IMF are expecting Thailand to bounce back to 6.1% growth next year.
On 12 May, Thailand announced it had no new coronavirus cases, a sign the lock-down and measures taken were having a positive effect. To date, Thailand has just over 3,000 cases and 56 deaths. Inbound flights were banned from 4 April and many forecast the 31 May date set for lifting the ban will be extended. Thailand adopted telecommuting very quickly and the habit of wearing masks and the cultural practice of the wai gesture (the customary greeting of bringing palms together) instead of shaking hands or kissing has reduced transmission. John Hopkins University, in its research published last year on countries providing the strongest health security, ranked Thailand sixth among 195 countries.
40 million people arrived in Thailand last year. According to the World Travel and Tourism Council ‘Travel and Tourism’ was worth £89.2 billion in 2018, approximately 20% of GDP. 4 million Thais work in the tourism sector and face a year without work or income.
As a trading nation, the impact on its manufacturing and agriculture sectors with disrupted supply chains and weakening global demand has been significant. The nation’s four largest commercial banks, which all have a relatively higher non-performing loan ratio of between 3.2% – 4.4%, are making preparations for a higher number of bankruptcies. The government has also decided to put on hold the decision of ratifying the Comprehensive and Progressive Agreement for Transpacific Partnership (CPTPP).
Fortunately, Thailand still has room for fiscal maneuvering. The current public debt to GDP ratio is at 41.28%. During the financial crisis of the late 1990s it soared to 59.22%. Public debt must not exceed 60% by law – a ceiling the government is considering raising.
UK-Thailand total trade in 2019 was valued at £6 billion with the UK reporting a trade deficit of £1.9 billion.
Areas of discussion
• What is the current coronavirus situation in Thailand?
• What is the economic outlook for the short and medium-term?
• What should UK companies be considering for their longer-term strategy?
This discussion is for UKABC partners and invited guests.
Brian Davidson – Biography
Brian Davidson has been British Ambassador to Thailand since June 2016. He has extensive experience in Asia, having started his career in Beijing (1988-1992) and most recently served as Consul General in Guangzhou and then Shanghai between 2006-2015. Other overseas posts have included Lithuania and Australia. While in the UK Brian has worked for the Cabinet Office as an analyst on international terrorism and on secondment to International Financial Services London as Deputy Chief Executive.
Richard Porter – Biography
Richard Porter is the Country Director of DIT in Thailand. DIT’s work includes helping British companies to find export opportunities into Thailand, helping those already in country to do more and finding opportunities for Thai investors to invest in the UK. Richard previously worked at the British Consulate in Sao Paulo for 5 years where he helped British companies find opportunities in the health sector across the Latin America region. Prior to that he worked for the management consulting firm PA Consulting for 10 years.