Is Thailand heading towards an economic crisis?

[hotchilli]

17 hours ago, webfact said:

“It is open for interpretation whether a short-term consumption stimulus is needed,” says Sakon Varanyuwatana, a former dean at Thammasat University’s Faculty of Economics.

Most things in Thailand are S-T

[The Cyclist]

40 minutes ago, soalbundy said:

Most economies are debt based economies with a planned amount of inflation, growth is needed to keep the cycle rolling otherwise you get stagflation.

 

Nothing wrong with that in theory. The problem arrises when that debt gets out of hand. See most Western economies for further details.

 

41 minutes ago, soalbundy said:

A big reset is coming and I don't think we will like it.

 

I believe that you are correct.

[Mike Lister]

Just now, hotchilli said:

If Thailands tourist high season is a flop then yes, I think Thailand is in for a rough ride in 2024.

Without the Chinese coming en-mass I think the writing is already on the wall.

The Thai economy has two main fee earners, Goods exports and international tourism. International tourism may not meet expectations or hopes but goods exports is improving, the two things combined only have to be average for the economy to be good.

[hotchilli]

2 minutes ago, Mike Lister said:

The Thai economy has two main fee earners, Goods exports and international tourism. International tourism may not meet expectations or hopes but goods exports is improving, the two things combined only have to be average for the economy to be good.

And one to fall below average to be not good.

[newbee2022]

17 hours ago, Mike Lister said:

The economists are right, the politicians are wrong, they should listen to them rather than just trying to create populist policies and give money away.

I don't agree. There is not only black and white or right or wrong. There are good reasons on both sides to consider. 

[Waterboy]

Cool Thai music is gone. It’s becoming boring. Less smiles etc girls are the main attraction. The new buildings on Suk suck. No street shops. Or character. Girls are it

[proton]

3 minutes ago, Waterboy said:

Cool Thai music is gone. It’s becoming boring. Less smiles etc girls are the main attraction. The new buildings on Suk suck. No street shops. Or character. Girls are it

 

Cool Thai music is gone, such as? don't tell me Carabao dinosaurs  

[Mike Lister]

5 minutes ago, hotchilli said:

And one to fall below average to be not good.

Yes sure. But 28 million tourists at a time when the world is recovering from covid and its economic effects has got to be a good number, Plus I don't know if anyone noticed but exports to the US have taken up a lot of the slack from the falling exports to China. The numbers are something like 13% and 3% and China isn't going to remain in the doldrums for long. I'm a glass half full on this, rather than half empty.

[Tom H]

1. The Thai Baht is too expensive. Export suffers.

 

2. Intelligent Thais study abroad and most of them wont come back.

 

3. Helicopter money.

 

4. Interest rate not in line with other countries. FDI (Foreign Direct Investment) is dropping or withdrawn.

 

5. No EU trade agreement like i.e. Vietnam has. Vietnam is overtaking Thailand in nearly all benchmarks soon.

Production happens in Vietnam!

 

6. A linked economy to struggeling China.

 

7. Samsung and many other production companies moved to Vietnam because of investor friendly factors.

 

8. No English skills

 

===> The government cant fix all issues at the same time. More experts are needed. Maybe international consultants?

Edited December 1, 2023 by Tom H

[The Cyclist]

18 hours ago, webfact said:

Gross domestic product in the third quarter grew by only 1.5 per cent. Most of the leading economists do not see any risk, but politicians in the ruling Pheu Thai Party and its supporters are ringing alarm bells.

 

For comparison, French GDP grew by 0.1% in the third quarter.

 

Many so called advanced economies will not grow by 1.5% in the whole of 2023.

[Tom H]

13 minutes ago, The Cyclist said:

 

For comparison, French GDP grew by 0.1% in the third quarter.

 

Many so called advanced economies will not grow by 1.5% in the whole of 2023.

Total other level. Cant be compared. 

(1.5% from i.e. 10000 is more than 3% from 10 :). Got it? GDP level!

Edited December 1, 2023 by Tom H

[Peterphuket]

16 hours ago, connda said:

The world economies most of which are fueled on debt are all on the cusp of "Economic Crisis."

When i first arrived here, the price of gold was 12K THB / baht-weight.  It will be 36K (if not more) by the end of 2024 (maybe the end of March 2024).  Current value of 23 karat Thai gold per baht-weight is 33.5K THB which is up 1000 THB over the last month.  Gold is up from 29.2K THB over the last year.
Does this mean that the value of gold has tripled?  Nope.  It means the value of Thailand fiat money has been discounted by 65+% relative to gold, and you CAN see this in the inflation of prices over the last 15 years.  The value of gold move inversely to the value of debased national fiat currencies.  Governments lie about the real value of their debased currencies and real inflation.  The value of gold relative to currencies does not lie.

The debt bubble will blow - not "If" but "When."  Highly leveraged and indebted nations will fall.  Read history.  The Depression, and its effect on the global economy.  And when the banks and the economy collapse?  Well, read up on one of the most recent collapses in Argentina 1998 to 2001.  Find some first hand accounts.  It's not pretty, especially when a nation and a people are forced down to the bottom of the Maslow's Hierarchy of Needs.

What's at the end of the line?  World War, imho, that will support Neo-Totalitarianism in most countries and the rise of Neo-Fascism in many of what are currently referred to as "liberal democracies." 

When you come first it was 12 k THB/Bath weight, when I com first it was 5 K THB/bath weight, that was about 25 years ago, it wil always continue to rise in line with its monetary value until people no longer see gold as valuable.

[The Cyclist]

8 minutes ago, Tom H said:

Total other level. Cant be compared.

 

Best take that up with the IMF and every other International Organisation.

 

Quote

GDP is important because it gives information about the size of the economy and how an economy is performing. The growth rate of real GDP is often used as an indicator of the general health of the economy. In broad terms, an increase in real GDP is interpreted as a sign that the economy is doing well.

 

[Chongalulu]

17 hours ago, 1FinickyOne said:

Is the entire world heading for a financial crisis?

No, only in your street..

[Mike Lister]

5 minutes ago, Tom H said:

1. The Thai Baht is too expensive. Export suffers.

 

2. Intelligent Thais study abroad and most of them wont come back.

 

3. Helicopter money.

 

4. Interest rate not in line with other countries. FDI (Foreign Direct Investment) is dropping or withdrawn.

 

5. No EU trade agreement like i.e. Vietnam has. Vietnam is overtaking Thailand in nearly all benchmarks soon.

Production happens in Vietnam!

 

6. A linked economy to struggeling China.

 

7. Samsung and many other production companies moved to Vietnam because of investor friendly factors.

 

8. No English skills

 

===> The government cant fix all issues at the same time. More experts are needed. Maybe international consultants?

1. BOT studies have shown, as have external studies, that there is no relationship between the strength or weakness of a country and its exports. The key issue that effects export volumes is the state of the economy and the strength of the economy in the buying or importing country. 

 

2. Do you have evidence for this, I don't believe any exists.

 

4. Every EM and emerging economy has lost inbound FDI to USD, Thailand is no exception. Lower interest rates here have however kept NPL's lower than they would otherwise be and inflation levels also.

 

6. Thailand's major export partner is the US, China is a developing export partner.

 

7. Vietnam is a developing economy, their GDP is two thirds of Thailand, it will attract some business because costs are cheaper but cost is not everything.

 

 

[Tom H]

9 minutes ago, The Cyclist said:

 

Best take that up with the IMF and every other International Organisation.

 

 

Right. But:

GDP higher by lower percentage in growth can be better as with lower GDP (Thailand) and higher percentage:). 😉

 

Edited December 1, 2023 by Tom H

[Tom H]

2 minutes ago, Mike Lister said:

1. BOT studies have shown, as have external studies, that there is no relationship between the strength or weakness of a country and its exports. The key issue that effects export volumes is the state of the economy and the strength of the economy in the buying or importing country. 

 

2. Do you have evidence for this, I don't believe any exists.

 

4. Every EM and emerging economy has lost inbound FDI to USD, Thailand is no exception. Lower interest rates here have however kept NPL's lower than they would otherwise be and inflation levels also.

 

6. Thailand's major export partner is the US, China is a developing export partner.

 

7. Vietnam is a developing economy, their GDP is two thirds of Thailand, it will attract some business because costs are cheaper but cost is not everything.

 

 

You are nearly in all items wrong, except 7.

Just for item 1):

That the export sector from Thailand is not related to the exchange rate as you stipulated is pure nonsense and shows that you dont have a clue.

Sorry mate. Disqualified.

[KhunLA]

NO

Same worldwide, the lazy poor will stay poor.  The driven middle class will grow, the elite will prosper more and more.

 

Where TH is losing low end manufacturing to neighbors, since they've recovered from wars and in country conflicts, they are gaining in the auto industry; EVs & battery, energy & tech manufacturing.   Though a lot will be automated.   Which leaves the rest of the working class, to continue being service oriented, and providing all things to the middle and HiSo folks.

 

Again, same worldwide.  More so for those western countries that outsource their manufacturing.

 

 

[The Cyclist]

2 minutes ago, Tom H said:

Right

 

I dont agree with it, but I am neither the IMF or other International Institution.

 

3 minutes ago, Tom H said:

But:

 

Take your buts up with the IMF.

[mfd101]

Most of this is pretty irrelevant for at least 2/3 of the population who live in 3rd World/2nd World conditions ie poverty absolute or relative.

 

They are not great consumers so the poorest of them will barely notice any moderate levels of inflation, and the others will just pull their tight belts in even tighter.

 

 

[Walker88]

I think tourism is a plus for the Thai economy, and might hit 20% or higher of Thai GDP in 2024 (vs 17.8% in 2019). The high season looks pretty good, as better hotels (which might be assumed to house wealthier, more-free-spending visitors) have high bookings. The govt seems to see this, which is why so many of its actions seemed geared toward the tourism sector. (The new tax scheme is not going to help in terms of expats, however.)

 

What bodes negatively for Thailand are the ongoing effects from Covid, and regional competition to be the SEAsian hub and labor source for international firms.

 

The world learned about the threats to supply chains during Covid, and many nations are taking steps to bring manufacturing back home. In a sense the end of globalization may be upon us. Certainly this supply chain issue is impacting China, so it's likely to hit Thailand, too.

 

Factories and plants that are getting long in the tooth and fully depreciated could disappear, rather than be upgraded or rebuilt. Vietnam is heavily courting Japanese manufacturing. That could hit Thai GDP.

 

Many export markets are being hit by domestic issues, most notably China. I'm a bit on the side of Peter Zeihan re China, though maybe for different reasons. The insolvency of Zhongzhi suggests that the fallout from the property sector (e.g., Evergrande) is spreading. China is awash in excess capacity as well as domestic debt. SOEs have always been a basket case, but this could be masked when the economy was on the boil. It's barely simmering now, relative to the last 2 decades. To the extent Thailand's economy is interwoven with China, China's problems will impact Thailand.

 

The ag sector has always been a plus for Thailand, but two things are impacting that:  the drought in some regions, and the war in Ukraine which affects fertilizer prices. That might play out more in 2024.

 

Thailand can afford the 10K baht scheme, though it will double FY2024's debt, but I'm not sure what effect it will have.

[kevin612]

No crisis until the baht is nearly 50 again vs usd 

[Mike Lister]

4 minutes ago, Tom H said:

You are nearly in all items wrong, except 7.

Just for item 1):

That the export sector from Thailand is not related to the exchange rate as you stipulated is pure nonsense and shows that you dont have a clue.

Sorry mate. Disqualified.

Thailand's main trading partner is the USA, the link below confirms.

https://www.worldstopexports.com/thailands-top-import-partners/

 

Impact of a firmer baht on exports is minimal, see Bangkok Post article entitled BOT warns baht will remain volatile, dated, 5 March 2019

 

"A study at macro-level found that the value of exports is influenced more by the economic situation and purchasing power of trading partner countries than Baht strength"

https://www.bot.or.th/content/dam/bot/documents/en/research-and-publications/reports/annual-report/AnnualReport2022.pdf.html

 

FDI flows and USD

https://blogs.worldbank.org/voices/three-ways-strong-dollar-impacts-emerging-markets

 

Thailand GDP USD 505 bill., Vietnam USD 366 bill....just google it.

 

Exports to USA: Thailand Total Exports to USA recorded 4.228 USD bn in Sep 2023, compared with 4.870 USD bn in the previous Aug 2023
Thailand Total Exports to USA data is updated monthly, available from Jan 1971 to Sep 2023, with an averaged value of 913.730 USD mn
The data reached an all-time high of 4.870 USD bn in Aug 2023 and a record low of 6.560 USD mn in Sep 1971.

 

Exports to China: Thailand Total Exports to China recorded 3.088 USD bn in Sep 2023, compared with 2.803 USD bn in the previous month
Thailand Total Exports to China data is updated monthly, available from Sep 1978 to Sep 2023, with an averaged value of 231.745 USD mn
The data reached an all-time high of 3.788 USD bn in May 2022 and a record low of 1.990 USD mn in Oct 1980

 

https://www.ceicdata.com/en/indicator/thailand/total-exports-to-china

https://www.ceicdata.com/en/indicator/thailand/total-exports-to-usa#:~:text=in Sep 2023%3F-,Thailand Total Exports to USA recorded 4.228 USD bn in,table below for more data.

 

Next!

 

 

 

[Tom H]

9 minutes ago, Mike Lister said:

Thailand's main trading partner is the USA, the link below confirms.

https://www.worldstopexports.com/thailands-top-import-partners/

 

Impact of a firmer baht on exports is minimal, see Bangkok Post article entitled BOT warns baht will remain volatile, dated, 5 March 2019

 

"A study at macro-level found that the value of exports is influenced more by the economic situation and purchasing power of trading partner countries than Baht strength"

https://www.bot.or.th/content/dam/bot/documents/en/research-and-publications/reports/annual-report/AnnualReport2022.pdf.html

 

FDI flows and USD

https://blogs.worldbank.org/voices/three-ways-strong-dollar-impacts-emerging-markets

 

Thailand GDP USD 505 bill., Vietnam USD 366 bill....just google it.

 

Exports to USA: Thailand Total Exports to USA recorded 4.228 USD bn in Sep 2023, compared with 4.870 USD bn in the previous Aug 2023
Thailand Total Exports to USA data is updated monthly, available from Jan 1971 to Sep 2023, with an averaged value of 913.730 USD mn
The data reached an all-time high of 4.870 USD bn in Aug 2023 and a record low of 6.560 USD mn in Sep 1971.

 

Exports to China: Thailand Total Exports to China recorded 3.088 USD bn in Sep 2023, compared with 2.803 USD bn in the previous month
Thailand Total Exports to China data is updated monthly, available from Sep 1978 to Sep 2023, with an averaged value of 231.745 USD mn
The data reached an all-time high of 3.788 USD bn in May 2022 and a record low of 1.990 USD mn in Oct 1980

 

https://www.ceicdata.com/en/indicator/thailand/total-exports-to-china

https://www.ceicdata.com/en/indicator/thailand/total-exports-to-usa#:~:text=in Sep 2023%3F-,Thailand Total Exports to USA recorded 4.228 USD bn in,table below for more data.

 

Next!

 

 

 

I make it easy for you:

 

You export a Thai Mango to the USA with an exchange rate of 35 B/USD or 45 B/USD.

Question:

Which exchange rate is better for sales?

🤔

[Jenkins9039]

17 hours ago, connda said:

The world economies most of which are fueled on debt are all on the cusp of "Economic Crisis."

When i first arrived here, the price of gold was 12K THB / baht-weight.  It will be 36K (if not more) by the end of 2024 (maybe the end of March 2024).  Current value of 23 karat Thai gold per baht-weight is 33.5K THB which is up 1000 THB over the last month.  Gold is up from 29.2K THB over the last year.
Does this mean that the value of gold has tripled?  Nope.  It means the value of Thailand fiat money has been discounted by 65+% relative to gold, and you CAN see this in the inflation of prices over the last 15 years.  The value of gold move inversely to the value of debased national fiat currencies.  Governments lie about the real value of their debased currencies and real inflation.  The value of gold relative to currencies does not lie.

The debt bubble will blow - not "If" but "When."  Highly leveraged and indebted nations will fall.  Read history.  The Depression, and its effect on the global economy.  And when the banks and the economy collapse?  Well, read up on one of the most recent collapses in Argentina 1998 to 2001.  Find some first hand accounts.  It's not pretty, especially when a nation and a people are forced down to the bottom of the Maslow's Hierarchy of Needs.

What's at the end of the line?  World War, imho, that will support Neo-Totalitarianism in most countries and the rise of Neo-Fascism in many of what are currently referred to as "liberal democracies." 

There's a least one smart chap here.

We live in an era of debt roll-over financing and printing the difference, the entire world blew up in 08, and a debt jubiliee was enacted, we no longer care about repayment, merely servicing the costs.

 

Cycle is every 3-5 yrs, roll-over year is 24/23 (state - commercial).

 

Asset prices will rise, gov will enact tightening late 25 into 26 and we will see the same - depressed state - followed by a new market in 27-29.

[Marco51]

17 hours ago, connda said:

The world economies most of which are fueled on debt are all on the cusp of "Economic Crisis."

When i first arrived here, the price of gold was 12K THB / baht-weight.  It will be 36K (if not more) by the end of 2024 (maybe the end of March 2024).  Current value of 23 karat Thai gold per baht-weight is 33.5K THB which is up 1000 THB over the last month.  Gold is up from 29.2K THB over the last year.
Does this mean that the value of gold has tripled?  Nope.  It means the value of Thailand fiat money has been discounted by 65+% relative to gold, and you CAN see this in the inflation of prices over the last 15 years.  The value of gold move inversely to the value of debased national fiat currencies.  Governments lie about the real value of their debased currencies and real inflation.  The value of gold relative to currencies does not lie.

The debt bubble will blow - not "If" but "When."  Highly leveraged and indebted nations will fall.  Read history.  The Depression, and its effect on the global economy.  And when the banks and the economy collapse?  Well, read up on one of the most recent collapses in Argentina 1998 to 2001.  Find some first hand accounts.  It's not pretty, especially when a nation and a people are forced down to the bottom of the Maslow's Hierarchy of Needs.

What's at the end of the line?  World War, imho, that will support Neo-Totalitarianism in most countries and the rise of Neo-Fascism in many of what are currently referred to as "liberal democracies." 

......and then there is this urge of government(s) to sneakily push for online banking and crypto currency of some sort, tax reforms (in the name of "fairness"...for who?) desperate for extra money. Covered up by crypto wallet schemes trying to dupe the average Sombat into thinking this a present (since when is a loan financed, tax paid feature a present?), when actually this is supposed to convince him/her of the "convenience of a cashless society" (convenience for governments and revenue departments to keep a constant hold over your money via AI, (remember : cash is yours and yours alone, also to know how many bills you have in your pocket) suddenly arising fees for paying bills at bank counter rather than online , a complete and thorough grip on bank accounts for transparency and taxation and a glass citizen overall. The argument "income from abroad has never been taxed" is B.S. Wealthy people keep their wealth and money where the return is good , don't need cash but have credit and always have means to have cash when needed , governments never argue with the rich.  All this is targeted at Sombat and Bob and Naomi Average, the lower and middle class have always been and always will be the ones to finance governments and completely incompetent ....es. And now we wonder why the bigger part of the previously democratic world is turning back to authoritarianism, this Mr. and Mrs. Average are tired of fighting and believe a leader will do that for them......................oh, he will, but not as they think. Quite possibly in future we will all wear ankle bracelets because it is so much cheaper to control via AI every citizens move and thought than do their job, while they are throwing around all the requisited monies. This is a worldwide phenomenon, the local real estate PM is no exception just a special cheeky example, Germany for example has a complete nincompoop in charge, England a Goldman-<deleted> banker, etc......and the many Lord Voldemorts are hinding in the wings......on y soit qui mal y pense.......Cheers.

[Mike Lister]

12 minutes ago, Tom H said:

I make it easy for you:

 

You export a Thai Mango to the USA with an exchange rate of 35 B/USD or 45 B/USD.

Question:

Which exchange rate is better for sales?

🤔

I can only explain it to you that studies have shown that export volumes are not dependent on the currency strength or weakness of the seller, it depends on the buyers economy and currency as to whether they can afford to buy (as the link I supplied earlier confirms). Somewhere out there is a BOT study on this subject. You don't have to believe it but you really ought to do a little bit of research otherwise you'll end up looking silly when you ask question like the one you just asked me above about which exchange rate is better. Of course one exchange rate is better, but that has zero to do with export levels. Your problem is that you're using logic as the basis of your statement rather than the realities of what actually happens.

 

"Weakness or strength in the baht has had a little impact on shipments",

 

https://www.reuters.com/markets/asia/thai-economy-seen-growing-3-4-this-year-inflation-fall-cbank-2023-02-28/

Edited December 1, 2023 by Mike Lister

[Mike Lister]

The other point to make about exchange rates and the Baht is that the Baht is not strong at present, it is very close to a 10 year low, the covid anomaly notwithstanding.

 

[Purdey]

All the focus is on tourism, not manufacturing or hi tech industries. With Thailand’s education system in 20th century mode (Thailand 0.4) with a cheap, low-educated workforce, not much will help. Change the way education works, get some decent teachers developed and wait.

the problem is, Thailand can’t wait and no government will be able to implement policies in time to save it.

[Cake Monster]

21 hours ago, webfact said:

Most economists, however, warn that the government must save money to cope with harder times in future.

 

And there is Lurch spending Money recklessly IMO

A Train wreck waiting to happen