Governor of the Bank of Thailand Dr. Sethaput Suthiwartnarueput stated that, despite COVID-19 impacts on the Thai economy, Thailand remains a good place to do business because of at least three reasons.
The first reason is the country’s resiliency. Thailand has an economy that is very resilient and has been able to withstand a lot of shocks. It has a very low level of external debt relative to its foreign reserves, which exceeds 200 billion dollars, while its short-term external debt is significantly below that. The country’s current account has traditionally had very large surpluses. Therefore, the risk of having a baht crisis, like the one Thailand had in 1997, remains extremely low.
Another factor that contributes to Thailand’s resiliency is the fact that Thailand’s labor markets are quite flexible and that there is a strong and extensive informal social safety net. In most cases, people who lose their jobs are able to return to their family, to the rural sector, and still able to survive.
The second reason is that Thailand’s business infrastructure and other forms of infrastructure are acceptable. The logistic-type infrastructure and basic infrastructure – water and electricity – are adequate, and the Government is undertaking investments in the context of the Eastern Economic Corridor, for example, U-Tapao airport, or even some of the railway investments. Overall, all kinds of infrastructure continue to improve. The COVID-19 situation has also sped up some of the underlying trends toward digitalization.
The final reason why Thailand remains a great place to do business is that there are some new trends that will help mitigate some of the long-term structural weaknesses in the Thai economy that are holding the country back. Technologies such as remote working and work-from-anywhere increase the likelihood of a more decentralized growth.
The Governor added that some of the trends that are going to take place – digital, automation, work-from-anywhere, and others – open the potential for Thailand to mitigate many of the weaknesses that have held the Thai economy back, as well as opening the potential for Thailand to grow in a stronger and more sustainable manner going forward.
Source: The Government Public Relations Department