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Thailand’s manufacturing production index dropped 25.8% in Dec.

Thailand’s Manufacturing Production Index (MPI) for last month, December, dropped 25.8 per cent year-on-year as a result of the country’s devastating flood crisis, according to the Office of Industrial Economics (OIE).

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Thailand’s Manufacturing Production Index (MPI) for last month, December, dropped 25.8 per cent year-on-year as a result of the country’s devastating flood crisis, according to the Office of Industrial Economics (OIE).

OIE Deputy Director General Aphiwat Asamaporn announced Friday that the December MPI decreased to 139.78, down 25.8 per cent, compared to the same period in 2010, due to the flooding in Thailand’s central provinces in late 2011 which submerged major industrial estates and negatively affected industrial entrepreneurs.

Meanwhile, the Capacity Utilisation Rate in December also stood at 52.3.

Despite the drop in the Dec MPI, the figure reflected a good sign of recovery, Mr Aphiwat said, explaining that the index contracted less and the Capacity Utilisation Rate rose.

The main impacted industries, which resulted in the falling MPI, included auto, hard disk drive, electronics, and air conditioner manufacturing industries .

Auto production and sales decreased by 30.4 and 30.9 per cent year-on-year respectively as the floods caused a supply chain disruption.

Regarding the hard disk drive industry, manufacturing dropped 55.7 per cent while total sales fell 60.5 per cent due to industrial estates where Thailand’s hard disk drive production is centred, suffered from the severe flooding.

Meanwhile, the production and sales of bottled drinking water edged up by 12.9 and 13.6 per cent respectively compared to the same period in 2010 thanks to growing demand on the part of consumers during the post-flood period.

via Flood sinks Thailand’s December manufacturing production index.

 

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Economics

Thailand’s Ministry of Finance expects 3.5 to 4.5% economic growth in 2022

For next year, the Ministry of Finance is projecting an economic growth of 3.5-4.5% from effective pandemic control measures, incentives, domestic spending, the export sector, private investment support, global economic recovery, and government expenditures.

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The Minister of Finance says Thailand’s economy this year would see only a 1.1-1.2% growth

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Ecommerce

Pakorn Peetathawatchai, President, The Stock Exchange of Thailand (SET)

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Pakorn Peetathawatchai, President, The Stock Exchange of Thailand (SET)

What measures has SET taken to support listed companies’ compliance with ESG standards?
PAKORN PEETATHAWATCHAI:

PAKORN: When we first began promoting ESG-compliant investments, we were met with little interest. We attributed this to a lack of clear data to showcase the economic benefits of ESG investment, and perhaps limited clarity as to what constitutes a sustainable or ESG-compliant investment. The launch of the THSI list and, subsequently, the SETTHSI Index, was designed to address this. Our most recent data, comparing returns for the SETTHSI Index with the broader SET and SET100 indices from April 2020 to April 2021, underscores the economic benefits of these investments: the group compliant with ESG standards outperformed the other two indices on every data point. 

As of May 2021 Thailand was home to CG and ESG assets under management totalling BT54.8bn ($1.7bn) across 50 funds – up from 23 funds in 2019. Meanwhile, of the BT187.1bn ($5.9bn) raised in green, social and sustainability bonds since 2018, BT136.4bn ($4.3bn) was raised in 2020 – 83% from the government and the remainder from development banks and private players. This rising demand, in a move to manage risk and generate returns, has been complemented by growing supply and promotion: supply from ESG-compliant businesses aiming for resiliency and sustainable growth, as well as promotion from regulators highlighting investment opportunities with good CG and SD practices. Indeed, the pandemic has been a catalyst in shifting the view of ESG compliance from a luxury to a requirement in the new normal.

In what ways can enhanced standard-setting and regulatory mechanisms overcome the remaining barriers to improved ESG performance?

PAKORN: A multi-stakeholder approach is crucial for enhanced ESG performance – not only in Thailand, but around much of the globe. This can also help to address the standout incumbent challenge: access to reliable, wide-ranging ESG data. For example, the 2020 update to the 56-1 One Report established clear ESG standards and triggered online and offline capacity-building programmes to support listed firms’ compliance. SET is developing an ESG data platform with a structured template to promote the availability of comparable data, maximise value added from corporate sustainability disclosures, and foster collaboration between the business value chain and stakeholders. This is expected to support Thai companies along their ESG journey in an economically sustainable way, result in a greater number of sustainability-focused products and services, drive sustainable investing in the Thai investment community and ultimately “make the capital market work for everyone”, as outlined in the SET’s vision.
 

 

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