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BANGKOK (NNT) – COVID-19 has resulted in last months’ consumer confidence index falling to its lowest in 21 years and seven months, but the Thai Chamber of Commerce believes a relaxation of lockdown measures, coupled with government stimuli, can still reinvigorate the domestic economy.

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A consumer confidence survey, conducted in April, revealed downward movement across the board for the 14th month in a row, resulting in the lowest rating in 21 years and seven months, or since the index began.

The figure dropped from 50.3 points the previous month to 47.2 due to concerns over the COVID-19 pandemic and its present and future impacts on the Thai economy, as well as rising unemployment.

The President of the University of the Thai Chamber of Commerce (UTCC), Asst. Prof. Dr. Thanavath Phonvichai, said the Thai economy is entering a recession after experiencing negative growth for a third quarter in a row and positive growth is only expected from the fourth quarter this year onward.

The forecast is based on the expectation that businesses will resume at the end of the year, and 400 billion baht in government stimuli will begin to enter the economy in August, helping to offset a projected contraction of 8.8 percent.

The contraction is now believed to be between 3.5 and 5.5 percent.

According to the UTCC President, the pandemic has removed an estimated 50 percent from the normal 600 billion baht in circulation, but up to 200 billion baht is expected to return if more business restrictions are lifted on May 17. The Thai economy is expected to show a clear recovery in the second quarter of 2021.

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Reporter : Praphorn Praphornkul /Rewriter : Asma Thinkohkaew

National News Bureau & Public Relations : http://thainews.prd.go.th

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Ecommerce

Disrupted by Covid-19, will South-east Asia’s super apps join forces?

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Disrupted by Covid-19, will South-east Asia's super apps join forces?
– Super apps explore inorganic growth options
– Gojek in talks with e-commerce company Tokopedia over $18bn merger
– Grab reported to be preparing for a public listing in the US
– Food delivery and financial services increasingly important segments

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After a year of external expansion and internal reorganisation due to Covid-19, South-east Asia’s super apps appear to be looking towards mergers and public listings as a strategy for future development.

In early January international media reported that Indonesian ride-hailing and payments giant Gojek was in advanced talks about merging with local e-commerce company Tokopedia, in a deal estimated to be worth $18bn.

Any potential merger between the two would be significant for Indonesia. The two local unicorns could create a digital powerhouse, with integrated services ranging from ride-hailing to digital payments, e-commerce and delivery.

A tie-up would also create numerous synergies, such as Gojek’s fleet being able to serve Tokopedia’s online shopping orders. However, there is also some overlap in the digital payments space, where Gojek’s GoPay platform competes with Ovo, which is 35% owned by Tokopedia, although there is speculation that Tokopedia may look to sell its stake in Ovo.

The news was followed by separate reports in late January that Grab, Gojek’s biggest competitor in South-east Asia, had selected investment banks Morgan Stanley and JP Morgan to help work on an initial public offering (IPO) in the US, set to take place in the second half of the year.

The Singapore-headquartered company, which operates ride-hailing, food delivery, e-payment and insurance services in around 400 cities across eight South-east Asian countries, is valued at around $16bn. Its IPO is expected to raise at least $2bn, which would make it the largest overseas share offering by a South-east Asian company.

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Thailand’s economic outlook for 2021

The government expects inbound tourism to be at around 8 million by the second half of 2021, well below 40 million in 2019

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The Thai economy will grow next year after contracting by almost 10% this year. Next year, the Thai economy is expected to expand 3 to 4% from this year. It will not be until the end of 2022 before the Thai economy returns to its pre-Covid level of 2019.

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Economics

Finance Ministry Considers Additional Incentives to Increase NSF Members

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BANGKOK (NNT) – The Finance Ministry is considering additional incentives to increase members in the National Savings Fund (NSF) as Thailand is projected to become a “super ageing society” by 2031.

Finance Minister Arkhom Termpittayapaisith said increasing state contributions to the NSF and extending the maximum membership age to 65 years old from 60 as stipulated by law are among the considerations.

He said Thailand is projected to become a fully aged society this year, meaning 20% of the total population is 60 or older. The country is projected to be a super ageing society by 2031, meaning 28% of the total population is 65 or older.

Mr Arkhom said retirement savings are vital because 20 million informal workers in Thailand are without mandatory savings programs.

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