The Office of the National Economic and Social Development Board stated that the downward revision was mainly from the drop in export values following the falling global oil and farm prices.
It cuts GDP growth forecast for this year to 3-4% from an earlier prediction of 3.5-4.5%.
It also expects Thailand to post only 0.2% growth in exports in 2015 from earlier projected 3.5%, while household consumption will expand by 2.3%.
The current account surplus for this year is expected to hit 3.9% of gross domestic product (GDP).
But NESDB secretary general Arkhom Termpittayapaisith said the weaker baht should have a positive impact on exports from the second quarter, As the Bangkok Post reported.
He said exports in the second quarter should be better than the first as there are more positive factors, citing accelerating government spending, increased private investment, tourism, and the weakening baht as reasons.
Exports fell for a third month in March, while consumer confidence dropped to a 10-month low in April.
The Bank of Thailand unexpectedly cut its key interest rate for a second straight meeting last month. The economy is recovering slower than expected, and exports are subject to greater downside risk, the monetary authority said in the minutes of its April 29 policy meeting.
Pakorn Peetathawatchai, President, The Stock Exchange of Thailand (SET)
What measures has SET taken to support listed companies’ compliance with ESG standards?
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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