Thai Chamber sees huge global slump ahead
The Thai Chamber of Commerce has painted a bleak prospect for Thai exports, predicting zero growth or 0.2% in a worst-case scenario next year. ''The Thai export sector is expected to feel the worst pinch from the global economic recession next year,'' said Dusit Nontanakorn, the chamber's vice-chairman. ''Right now, Thai exporters themselves have started seeing requests from customers from traditional key markets such as the United States and European Union to delay their payments, prompting Thai exporters to experience liquidity problems.''
According to Mr Dusit, certain buyers have bargained to delay their payments to between three and four months from one to two months previously.
Expansion into new markets such as the oil-rich countries in the Middle East is not as easy as some companies had anticipated, as oil prices are plunging, leading to shrinking purchasing power in those new markets.
''We're afraid it will take at least three years for the [economic] recovery. Worse still, Thailand is facing protracted political conflicts,'' said Mr Dusit.
Pramon Sutivong, the chairman of the Thai Chamber of Commerce, said it was essential for the private and public sectors to forge closer collaboration to cope with today's serious challenges.
The Chamber also pledged to find ways to help improve financial liquidity, as giant operators are expected to pass responsibility for sourcing working capital onto smaller ones.
At the Nov 20 meeting of the Joint Public and Private Consultative Committee, business leaders will urge the government to speed up its 100-billion-baht economic stimulus spending, especially any measures that could help raise local firms' competitiveness.Mr Pramon said the chamber would also propose personal and corporate income tax cuts to raise spending.
According to the latest survey by the University of the Thai Chamber of Commerce (UTCC), most operators remain uncertain about their prospects.
''Negative factors are abundant, be it the word's economic recession fuelled by the US financial crisis, ongoing political instability, weakened farm prices and the credit crunch,'' said Thanavath Phonvichai, a UTCC economist.
The university has predicted the country's economy will grow by 3.9% to 4.1% next year, assuming political stability is restored, exports grow by 8-10%, inflation is 3-4%, and unemployment is 600,000 to 750,000 compared with about 500,000 this year.
In the worst-case scenario _ a global recession led by deterioration in the US, EU and Japan, plus political instability at home _ the economy could grow by only 2.9% to 3.1% with export growth of 0-0.2%, inflation at 2-2.5% and unemployment rising to between 760,000 and 900,000.