Is the Thai economy collapsing?

[Tomtomtom69]

Most Thais think you just need to start a business , open the doors and the money rolls on in. The reality is they run it into the ground over a year draining family and farang finances and disappear to be quickly replaced by the next in line. Ive lost count of these type of small business around me in Bangkok that turn over sometimes 4 in a year...same shop

More to do with zero research and experience than a collapsed economy

Not sure if this is related to the economy, rivalry, arson or other reasons (but probably the latter rather than the former): At the entrance to the road that leads to my moo baan (although it's over 2km from where I live) there is a small restaurant that started off as a tiny brothel, was torn down then a small restaurant opened on the site. This restaurant lasted for a few weeks before mysteriously burning down to the ground. All of a sudden one day I was driving to work and there I saw it in smoldering remains. Within days, the mess was cleaned up and a new restaurant was built in it's place. All of this happened within the space of a few months.

Directly opposite, an empty site once hosted an evening market just for a few weeks after years of empty space. Then as soon as the market came it went, presumably because there weren't enough customers in what is a semi-rural, semi-industrial area. There is a factory across the road but even that may not have been enough to sustain the market with customers. So it shut down.

Now there is a lone wooden restaurant built randomly in the middle of this empty site. It also has live music in the evenings. I wonder how long it will last.

[abrahamzvi]

I was speaking with a friend in Thailand two weeks ago.She owns a guest house and said she has never seen business so bad.Normally in low season it's slow but this season is really bad.Most all hotels and guest houses in the city are the same situation.

This is not quite correct. If one follows the economic news,one sees that hotel occupancy has gone up by nearly 10% this year compared to last year and hotels expect a further growth for the upcoming tourist high season, This, of course, applies to the main tourists areas like Bangkok, Pattaya, Hua hin, Phuket or Chiang Mai.

It is a different story if one looks at the make up of the tourism and their expenditure.

[Tomtomtom69]

Going by the number of empty shops in Central Plaza, Khon Kaen, that were once trading, and by the huge number of shops-houses that are built but never occupied, and, to my eyes, the fewer cars on the road, I think the economy is not good.

the fewer cars on the road...?

Are you serious ?

I am often travelling the South to North AH2 and AH 1 from the very South up to Nakhon Sawan.

I see an increase in the numbers of cars, big and new cars and trucks of all sizes.

Guess we should have the official numbers of registered cars to compare - lets say - over the last 5 years.

Agreed. There are definitely more cars on the roads. There is however a decrease in the number of new car registrations - last year Thais purchased just 700,000 odd vehicles [cars], down by 50% from the peak of more than 1.4 million under the 2012 Yingluck first car buyer's scheme and also lower than the long-term average of around 1 million units that would be expected to be purchased in a good economy.

[elgordo38]

Most Thais think you just need to start a business , open the doors and the money rolls on in. The reality is they run it into the ground over a year draining family and farang finances and disappear to be quickly replaced by the next in line. Ive lost count of these type of small business around me in Bangkok that turn over sometimes 4 in a year...same shop

More to do with zero research and experience than a collapsed economy

Yes I have noticed it to. I watched what seemed like a successful restaurant close after 6 months and be replaced by a beauty shop. The location is a bit out of the way.

[elgordo38]

When I first arrived in Thailand two years ago, the economy appeared to be humming along fine to me.

Then I realized it is all a debt funded facade.

If rates ever go higher, the economy is screwed as the banks will be screwed due to delinquent debts.

At least folks in the west with huge mortgages tend to win due to appreciation.

My experience here suggests that Thais lever up and buy depreciating assets such cars or real estate.

I like the term debt funded facade. That describes what we have exported to them along with the so called prosperity they seemingly enjoy. My problem is my age as I think back how we struggled and saved to buy the necessities of life now its off to the bank to borrow cheap money to travel buy new cars and the newer IT items. The value of money seems to be lost to current generations but the appeal of cheap bank loans is like a drug on society. Even more sadly is the fact that my 2 children who I raised respecting money and its uses now do not seem to see the approaching peril of cheap money. Edited July 20, 2016 by elgordo38

[elgordo38]

My take as long as the Army is running the government the country isn't going to do good.Whenever the coup finishes up I believe

Things will get better

You should live so long.

[elgordo38]

If you listen to the dopes on TV, the fact that a few skint European tourists go to Cambo or Burma because beer prices in Thailand have risen by 20 baht is tantamount to a deep and damaging recession.

They think their "family" shopping excursions at Big C to buy bright pastel-coloured, Chinese-made plastic crap are the absolute bedrock of the Thai consumer revolution

Seriously, though, the economy is doing fine.

Hardly great guns but it's doing fine.

"Seriously, though, the economy is doing fine."

And you can support your statement with facts and links?

Thailand's forex reserves indicate "quite satisfactory":

thailand-foreign-exchange-reserves.jpg

I have long since learned never to trust government numbers, speeches of reassurance and that they are doing everything for the people. Its been the same crap for decades now we are a party for the people blah blah blah. Just listened to Theresa May spout the same garbage. Its all a verbal con game.

[lannarebirth]

I for one commend the Thais on their entrepreneurial spirit. Sure, there are lots of coffee shops. I can't think of another business that has a lower barrier to entry. Some may succeed, most will fail but I'm sure the failures will be back with new schemes to escape wage slavery. Nothing good is going to come from the top down. These folks recognize they have to make their own way to enter the middle class and beyond. Good luck to them.

[Berty100]

If you listen to the dopes on TV, the fact that a few skint European tourists go to Cambo or Burma because beer prices in Thailand have risen by 20 baht is tantamount to a deep and damaging recession.

They think their "family" shopping excursions at Big C to buy bright pastel-coloured, Chinese-made plastic crap are the absolute bedrock of the Thai consumer revolution

Seriously, though, the economy is doing fine.

Hardly great guns but it's doing fine.

"Seriously, though, the economy is doing fine."

And you can support your statement with facts and links?

Thailand's forex reserves indicate "quite satisfactory":

thailand-foreign-exchange-reserves.jpg

When a countries decline in imports is much larger then the decline in exports, then it isn't surprising that the foreign reserves increase, but it is also an indication that the industry in that country is slowing down massively hence there is no need for import of raw materials.

[Jip99]

If you listen to the dopes on TV, the fact that a few skint European tourists go to Cambo or Burma because beer prices in Thailand have risen by 20 baht is tantamount to a deep and damaging recession.

They think their "family" shopping excursions at Big C to buy bright pastel-coloured, Chinese-made plastic crap are the absolute bedrock of the Thai consumer revolution

Seriously, though, the economy is doing fine.

Hardly great guns but it's doing fine.

"Seriously, though, the economy is doing fine."

And you can support your statement with facts and links?

You mean the statement in which I say the economy is hardly going great guns?

You actually said "the economy is doing".

It is not from all the evidence but your hatred of Farangs is tainting your vision!

The fact is that you have no idea how the 'Thai economy' is doing (neither do I) because the figures are simply not available - or are distorted to paint the usual rosey picture of Thailand.

If empirical local stories are to be believed then the bulk of Thailand is deeper in debt than it has ever been and income (mainly from farming) is being hit from all angles.

[chiang mai]

If you listen to the dopes on TV, the fact that a few skint European tourists go to Cambo or Burma because beer prices in Thailand have risen by 20 baht is tantamount to a deep and damaging recession.

They think their "family" shopping excursions at Big C to buy bright pastel-coloured, Chinese-made plastic crap are the absolute bedrock of the Thai consumer revolution

Seriously, though, the economy is doing fine.

Hardly great guns but it's doing fine.

"Seriously, though, the economy is doing fine."

And you can support your statement with facts and links?

Thailand's forex reserves indicate "quite satisfactory":

thailand-foreign-exchange-reserves.jpg

When a countries decline in imports is much larger then the decline in exports, then it isn't surprising that the foreign reserves increase, but it is also an indication that the industry in that country is slowing down massively hence there is no need for import of raw materials.

The decline in imports is not the reason, Thailand has operated a trade surplus for a couple of years now:

http://www.tradingeconomics.com/thailand/balance-of-trade

The uptick in the value of the foreign reserves was due to them being revalued against current exchange rates which showed a substantial jump:

http://www2.bot.or.th/statistics/ReportPage.aspx?reportID=80&language=eng

[thaibeachlovers]

Most Thais think you just need to start a business , open the doors and the money rolls on in. The reality is they run it into the ground over a year draining family and farang finances and disappear to be quickly replaced by the next in line. Ive lost count of these type of small business around me in Bangkok that turn over sometimes 4 in a year...same shop

More to do with zero research and experience than a collapsed economy

If you want to launch into a diatribe against Thais, please do it on a different thread.

I specifically said it was about LONG ESTABLISHED businesses to avoid replies such as yours.

To those that answered the question, thank you.

[thaibeachlovers]

Amazing a few mam and pop shops close and the doomsters are out in force .

Record numbers of arrivals .Stock market not too far off a record high.

Considering the global picture Thailand is doing well for a country with an Junta government . Your cash in a Thai Bank offers more protection guarantee than European banks Remember.Santander recently failed a stress test

I really, really wish people would leave the gambling for rich people ( stock market ) out of a discussion about small, local businesses and economy. Does anyone think the owners of the types of businesses I mentioned in the OP are participating in the stock market? The stock market could vanish today and it would make zero difference to the lives of the vast majority of people anywhere.

[thaibeachlovers]

The OP is talking about the ecomomy in his village. Not Thai exchange rates or the Thai economy relative to other countries.

Unless the local noodle shop guy is playing the money market, exchange rates probably have no impact on weather he has customers, can pay the rent etc.

Noodle shop guy has no money, he stops getting his laundry done. Laundry has no money, they stop getting a massage. Massage shop has no money they stop buying noodles.

Yes, foreign exchange, exports etc eventually bring new money into Thailand.

Like the OP, I have seen local shops closing etc.

That is the real Thai economy. I I dont think its in great shape.

Best reply. Thank you.

[thaibeachlovers]

Vehicle numbers declining? Not in my part of the world (south Surin). When I first came here 4 years ago, there were water buffalo everywhere, the old little tractors transporting people in carts ... now the roads are packed with new cars, pickups and heavy trucks, particularly on the main west/east road from BKK to Laos & Vietnam. New houses are abuilding in many places, and not just for rich falangs. Water buffalo have all but disappeared - I gather there is a move to breed them to preserve a disappearing species.

None of this looks like an economy in trouble, at least not for the rural poor, quite a few of whom have started the long hard clamber up the ladder. The process takes time but, visually on the roads here, the change in just 4 years is quite dramatic.

That depends on whether all those things are bought with actual money, or on funny money credit. The fact my wife could buy a new car says much about shonky lending policies, and I fully expect tears when she loses it.

The US tried funny money lending and the results are still affecting us 8 years later.

[Robert24]

No. Thai economy still growing.

[mfd101]

Vehicle numbers declining? Not in my part of the world (south Surin). When I first came here 4 years ago, there were water buffalo everywhere, the old little tractors transporting people in carts ... now the roads are packed with new cars, pickups and heavy trucks, particularly on the main west/east road from BKK to Laos & Vietnam. New houses are abuilding in many places, and not just for rich falangs. Water buffalo have all but disappeared - I gather there is a move to breed them to preserve a disappearing species.

None of this looks like an economy in trouble, at least not for the rural poor, quite a few of whom have started the long hard clamber up the ladder. The process takes time but, visually on the roads here, the change in just 4 years is quite dramatic.

That depends on whether all those things are bought with actual money, or on funny money credit. The fact my wife could buy a new car says much about shonky lending policies, and I fully expect tears when she loses it.

The US tried funny money lending and the results are still affecting us 8 years later.

Well, the vehicles are still on the roads and presumably they're not fueled just on hot air ... And I'm talking big heavy trucks & roadtrains on the main international routes as well as cars and pickups. So someone or other is paying in real money!

[thaibeachlovers]

I noticed two currency exchange booths which had been open for a few years had closed down in central Pattaya yesterday. No doubt oversupply of such services (following the on-every-street-corner opticians, pharmacy, real estate office, nail and hairdressing salons crazes of previous years) but for sure lack of money-changing tourists too.

Pattaya is crashing for sure. The rest of the nation seems to be slowing down, but I'd hesitate to say crashing. The global economy isn't doing well. Which helps drive Asia.

Pattaya has been cruisin' for a bruisin' for many years now. The rush to move upmarket was a huge mistake and to use the ol' cliche, that sound you hear is the chooks returning home to roost. Once the Russians departed and the non spending Chinese tour groups arrived it was all over and the fat lady is singing.

Any place that forgets it's roots is destined to fail, and in the case of Pattaya putting lipstick on the pig doesn't change the fact that Pattaya is a dump with a rubbish beach. They haven't fixed the infrastructure in 20 years, and the only new things they built are disasters- the walkway, the marina, the carpark at Bali Hi.

None of that would make any difference to mongers, but now all the hotels have called themselves "boutique" and put the prices up to ridiculous levels the mongers aren't coming anymore either.

Don't get me wrong, I loved Pattaya when I lived there, but it's gone down a very bad road.

[thaibeachlovers]

Vehicle numbers declining? Not in my part of the world (south Surin). When I first came here 4 years ago, there were water buffalo everywhere, the old little tractors transporting people in carts ... now the roads are packed with new cars, pickups and heavy trucks, particularly on the main west/east road from BKK to Laos & Vietnam. New houses are abuilding in many places, and not just for rich falangs. Water buffalo have all but disappeared - I gather there is a move to breed them to preserve a disappearing species.

None of this looks like an economy in trouble, at least not for the rural poor, quite a few of whom have started the long hard clamber up the ladder. The process takes time but, visually on the roads here, the change in just 4 years is quite dramatic.

That depends on whether all those things are bought with actual money, or on funny money credit. The fact my wife could buy a new car says much about shonky lending policies, and I fully expect tears when she loses it.

The US tried funny money lending and the results are still affecting us 8 years later.

Well, the vehicles are still on the roads and presumably they're not fueled just on hot air ... And I'm talking big heavy trucks & roadtrains on the main international routes as well as cars and pickups. So someone or other is paying in real money!

Erm. There's a difference between earning enough to put petrol in the car and earning enough to buy a car. BTW local people that I'm talking about don't own big heavy trucks.

[mcfish]

Most Thais think you just need to start a business , open the doors and the money rolls on in. The reality is they run it into the ground over a year draining family and farang finances and disappear to be quickly replaced by the next in line. Ive lost count of these type of small business around me in Bangkok that turn over sometimes 4 in a year...same shop

More to do with zero research and experience than a collapsed economy

If you want to launch into a diatribe against Thais, please do it on a different thread.

I specifically said it was about LONG ESTABLISHED businesses to avoid replies such as yours.

To those that answered the question, thank you.

Get a grip. Your sensationalist thread title drew me in and I was hoping to see some interesting content but what I saw was probably the silliest post I have ever read . An anonymous one horse town and some shut shops. Long established is completely subjective in Thailand

How about you put a bit of effort into it and name the town and business involved. The location and population, Lets start with that shall we?

Next time dont be so lazy!

[Agent Sumo]

Most Thais think you just need to start a business , open the doors and the money rolls on in. The reality is they run it into the ground over a year draining family and farang finances and disappear to be quickly replaced by the next in line. Ive lost count of these type of small business around me in Bangkok that turn over sometimes 4 in a year...same shop

More to do with zero research and experience than a collapsed economy

If you want to launch into a diatribe against Thais, please do it on a different thread.

I specifically said it was about LONG ESTABLISHED businesses to avoid replies such as yours.

To those that answered the question, thank you.

Get a grip. Your sensationalist thread title drew me in and I was hoping to see some interesting content but what I saw was probably the silliest post I have ever read . An anonymous one horse town and some shut shops. Long established is completely subjective in Thailand

How about you put a bit of effort into it and name the town and business involved. The location and population, Lets start with that shall we?

Next time dont be so lazy!

[mfd101]

Vehicle numbers declining? Not in my part of the world (south Surin). When I first came here 4 years ago, there were water buffalo everywhere, the old little tractors transporting people in carts ... now the roads are packed with new cars, pickups and heavy trucks, particularly on the main west/east road from BKK to Laos & Vietnam. New houses are abuilding in many places, and not just for rich falangs. Water buffalo have all but disappeared - I gather there is a move to breed them to preserve a disappearing species.

None of this looks like an economy in trouble, at least not for the rural poor, quite a few of whom have started the long hard clamber up the ladder. The process takes time but, visually on the roads here, the change in just 4 years is quite dramatic.

That depends on whether all those things are bought with actual money, or on funny money credit. The fact my wife could buy a new car says much about shonky lending policies, and I fully expect tears when she loses it.

The US tried funny money lending and the results are still affecting us 8 years later.

Well, the vehicles are still on the roads and presumably they're not fueled just on hot air ... And I'm talking big heavy trucks & roadtrains on the main international routes as well as cars and pickups. So someone or other is paying in real money!

Erm. There's a difference between earning enough to put petrol in the car and earning enough to buy a car. BTW local people that I'm talking about don't own big heavy trucks.

If people can afford only to fuel the vehicle - of whatever size - and not make the payments on the loan, then the vehicle gets repossessed and is taken off the road. But they're still there on the road and the traffic in this part of Thailand gets heavier and heavier by the month. Which is why such major works are under way in Surin & Buriram to widen the main roads (east/west) to 4 and 6 lanes ...

[elgordo38]

Vehicle numbers declining? Not in my part of the world (south Surin). When I first came here 4 years ago, there were water buffalo everywhere, the old little tractors transporting people in carts ... now the roads are packed with new cars, pickups and heavy trucks, particularly on the main west/east road from BKK to Laos & Vietnam. New houses are abuilding in many places, and not just for rich falangs. Water buffalo have all but disappeared - I gather there is a move to breed them to preserve a disappearing species.

None of this looks like an economy in trouble, at least not for the rural poor, quite a few of whom have started the long hard clamber up the ladder. The process takes time but, visually on the roads here, the change in just 4 years is quite dramatic.

That depends on whether all those things are bought with actual money, or on funny money credit. The fact my wife could buy a new car says much about shonky lending policies, and I fully expect tears when she loses it.

The US tried funny money lending and the results are still affecting us 8 years later.

Well, the vehicles are still on the roads and presumably they're not fueled just on hot air ... And I'm talking big heavy trucks & roadtrains on the main international routes as well as cars and pickups. So someone or other is paying in real money!

I am sorry to inform you that there is no "real" money left only funny money, cheap loans from banks. You sound like your someone older like me and a person that came up through the decades and paid his dues. The lifestyle we see today was non existent back in our day and times and wages were better and houses were cheaper and your local bank manager wanted to see some real proof of income. We are living in a house built on quick sand. The lifestyle we see today is unjustified and unsustainable surreal. Edited July 20, 2016 by elgordo38

[mfd101]

Vehicle numbers declining? Not in my part of the world (south Surin). When I first came here 4 years ago, there were water buffalo everywhere, the old little tractors transporting people in carts ... now the roads are packed with new cars, pickups and heavy trucks, particularly on the main west/east road from BKK to Laos & Vietnam. New houses are abuilding in many places, and not just for rich falangs. Water buffalo have all but disappeared - I gather there is a move to breed them to preserve a disappearing species.

None of this looks like an economy in trouble, at least not for the rural poor, quite a few of whom have started the long hard clamber up the ladder. The process takes time but, visually on the roads here, the change in just 4 years is quite dramatic.

That depends on whether all those things are bought with actual money, or on funny money credit. The fact my wife could buy a new car says much about shonky lending policies, and I fully expect tears when she loses it.

The US tried funny money lending and the results are still affecting us 8 years later.

Well, the vehicles are still on the roads and presumably they're not fueled just on hot air ... And I'm talking big heavy trucks & roadtrains on the main international routes as well as cars and pickups. So someone or other is paying in real money!

I am sorry to inform you that there is no "real" money left only funny money, cheap loans from banks. You sound like your someone older like me and a person that came up through the decades and paid his dues. The lifestyle we see today was non existent back in our day and times and wages were better and houses were cheaper and your local bank manager wanted to see some real proof of income. We are living in a house built on quick sand. The lifestyle we see today is unjustified and unsustainable surreal.

In which case we should be seeing inflation running at 20 or 30 or 40%, like a conservative version of Zimbabwe, all running on funny money. But we're not seeing that at all.

Sure there are no doubt plenty of cases of stupid people borrowing beyond their capacity to manage, just as in every other country in the world, but that doesn't mean it's all like that or even mainly like that. Modern or semi-modern economies are huge & complex. While some things are going down, others may be booming. (Australia post-mining boom over the last 3 years is a nice example.) What we see in Thailand is everything from First World wealth and sophistication to Fourth World poverty, just like Russia or Indonesia or Brazil and many other such countries - uneven, messy, good and horrible.

[thaibeachlovers]

Most Thais think you just need to start a business , open the doors and the money rolls on in. The reality is they run it into the ground over a year draining family and farang finances and disappear to be quickly replaced by the next in line. Ive lost count of these type of small business around me in Bangkok that turn over sometimes 4 in a year...same shop

More to do with zero research and experience than a collapsed economy

If you want to launch into a diatribe against Thais, please do it on a different thread.

I specifically said it was about LONG ESTABLISHED businesses to avoid replies such as yours.

To those that answered the question, thank you.

Get a grip. Your sensationalist thread title drew me in and I was hoping to see some interesting content but what I saw was probably the silliest post I have ever read . An anonymous one horse town and some shut shops. Long established is completely subjective in Thailand

How about you put a bit of effort into it and name the town and business involved. The location and population, Lets start with that shall we?

Next time dont be so lazy!

[marcofunny]

the secret of the success of the Thai economy is its large foreign exchange reserves. Thailand is ranked 13th worldwide and holds 178 billion$, this what makes the thai baht a strong currency.

https://en.wikipedia.org/wiki/List_of_countries_by_foreign-exchange_reserves

Thailand has more $ reserves then UK 14th and the united states 17th, we seen recently Venezuela and Egypt and other countries who had shortages of foreign reserves and how it causes a hyper inflation and inability to import necessities.

why Thailand has large foreign reserves thus very strong currency.

probably because Thailand does not import its food necessities, its citizens travel abroad less frequently then other nations, thus demand for foreign currency is lower, currency control also plays a role it s hardier to send funds abroad.

Edited July 20, 2016 by marcofunny

[how241]

It's going as good as many other places without all the debt.

[Jip99]

It's going as good as many other places without all the debt.

Thais are without debt?

There are billions in debt that don't even feature on the radar............................. go do some research about loans in the villages (not village loans... over and above all that)

[chiang mai]

the secret of the success of the Thai economy is its large foreign exchange reserves. Thailand is ranked 13th worldwide and holds 178 billion$, this what makes the thai baht a strong currency.

https://en.wikipedia.org/wiki/List_of_countries_by_foreign-exchange_reserves

Thailand has more $ reserves then UK 14th and the united states 17th, we seen recently Venezuela and Egypt and other countries who had shortages of foreign reserves and how it causes a hyper inflation and inability to import necessities.

why Thailand has large foreign reserves thus very strong currency.

probably because Thailand does not import its food necessities, its citizens travel abroad less frequently then other nations, thus demand for foreign currency is lower compared to other nations.

Thailand's foreign currency reserves have very little bearing on THB strength, currencies become weaker or stronger for one reason only and that is through the extent to which they are traded. Now I grant you that the strength of the underlying economy is one of the reasons why THB is traded so much and the size of the country''s foreign reserves is a small part of that, but to attribute THB strength solely to the currency reserves is not correct.

TO add: Also, accumulation of foreign currency reserves takes place through several means but primarily through export bills that are settled in USD and receipts and forex resulting from tourism.

Edited July 20, 2016 by chiang mai

[marcofunny]

Thailand's foreign currency reserves have very little bearing on THB strength, currencies become weaker or stronger for one reason only and that is through the extent to which they are traded. Now I grant you that the strength of the underlying economy is one of the reasons why THB is traded so much and the size of the country''s foreign reserves is a small part of that, but to attribute THB strength solely to the currency reserves is not correct.

the Thai foreign reserve is large compared to the nation's size, Thailand has even more reserves then nations like Australia, Canada, UK, US, France, Norway, demand for the dollars among the Thai is much lower then say most African or south American nations, thus the central bank affords to sell the Thai baht at higher prices, it s as simple as any basic economic of trading.

note that Thailand does not run any heavy expensive social programs, or imports the majority of its necessities(food or medicine) from abroad, it does not have any major security threats or wars, thus less needs for massive spending on military per GDP, its population does not travel abroad frequently like the UK or other nations, thus logical explanation why its currency is strong or they are simply not spending the dollars they are earning.

Edited July 20, 2016 by marcofunny