Bangkok--15 Oct--Krungthep Turakij
Krungthep Turakij in collaboration with Dhurakij Pundit University Research Center (DPURC) conducted a survey of 403 CEOs. The survey asked these CEOs about their views on the Thai economic outlook, business performance as well as important factors affecting their business in September-October. The survey was carried out from 23rd September to 2nd October 2013.
The economic index has remained negative for two consecutive months. The September’s index falls to -7, a 5-point fall from August; the index is expected to remain negative in October, with the value being -8. The fall of this index has been driven by the slowdown of Thai economy, declining purchasing power due to rising cost of living and global economy.
Four business performance sentiment indices- revenue, cost, liquidity and employment- continue to be pessimistic. September’s revenue index is -10; a further decline of the index to -11 is expected in October. Cost index rises from 52 in August to 54 in September; the index is expected to fall 47 in October. While the fall represents an improvement, the fact that the cost index remained positive implies that the cost would continue to rise, albeit at a slower pace than August. Pessimistic outlooks for revenue and cost indices have caused the liquidity index to fall to -3 in September; the index is expected to fall further to -5 in October. For the first time in this year, the employment index falls to -3 and is expected to remain at -1 in October.
The five most important factors affecting business performances in September-October are as follows: overall condition of the Thai economy (4.5 points on a scale of 5); reduced demand (4.3 points); global economy (4.2 points); costs of raw materials (4.0 points); and exchange rate volatility (4.0 points).
It is clear from the results of this survey that economic slowdown and cost of living have caused a decline in the nation’s purchasing power. While this pessimistic trend has led to prolonged liquidity problem, the fact that rating for access to finance has fallen from 3.9 in August to 3.4 in September imply that business has been able to find a way to cope with the problem, albeit a temporary one. What remained to be seen is how will the business cope with the unwelcoming trend of the Thai economy if such trend is to be protracted.