Industrial Confidence Rises, Sentiment Index Up Sixth Straight Month
Industrial confidence remains high despite concerns the euro-zone crisis is beginning to weigh on Thai exports. The Thai Industries Sentiment Index (TISI) rose for the sixth consecutive month, hitting 106 points in May from 104 in April. The confidence index has finished above 100 points for four straight months, signalling that production and the economy will continue to grow. May’s industry confidence survey by the Federation of Thai Industries (FTI) involved 1,110 manufacturers in 42 industry groups. “This shows that business operators believe the Thai economy still has the potential to grow, especially when the flood situation returns to normal,” said FTI chairman Payungsak Chartsutthipol. Concerns about rising costs, labour shortages, political issues and the euro zone remain.
Mr Payungsak said the outlook for the TISI will depend on the formation of a Greek government, which should be clear next month, while Spain and Italy are the next concerns. Mr Payungsak remains confident in the possibility of this year’s exports growing by 15%.
“Although the target is challenging due to the European debt crisis, we still believe the target is achievable,” he said. Mr Payungsak said Thailand will be affected by the euro-zone crisis less than other countries, as Thai products have high quality and are necessary for consumption. The only worrying sector is jewellery, orders for which have dropped considerably from the EU and the Middle East. “Nonetheless, business operators have not been staying still and are trying to find new markets, while there is still a six-month period for them to increase orders in existing markets,” said Mr Payungsak, adding that some are increasing production at factories outside the country while lowering production at plants in Thailand. Food, for instance, can go anywhere in the world.
– From Bangkok Post, June 21, 2012
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