| Author | Suchot Thirawannarat |
|---|
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Thai economic figures in the fourth quarter of 2022 grow below expectations.
But there are still hidden advantages.
article “Think, Comment, Share” In this regard, I will raise the views of economists from KGI Securities (Thailand) on the past quarterly Thai economic data report, which the Office of the National Economic and Social Development Council (NESDB) or NESDB has announced. Thai economic growth rate (GDP) in 4Q22 grew around +1.4% compared to the previous year, but was negative from the 3Q22 to -1.5% quarter-on-quarter. which is much lower than expected The market expects the 4Q22 GDP figure to be around +3.6% compared to the previous year. When considering the composition of the 4Q22 GDP figure, it will be found that there are both good and bad parts.
The good consumption sector tends to improve. But this was weighed down by an increase in non-performing debt due to very high household debt. As for the foreign sector, there is a clear direction and will continue to improve. both from the tourism sector where the number of foreign tourists continues to increase At the same time, although the volume of merchandise exports has slowed down. But there is still a good sign that Thailand’s trade and services balance in 4Q22 turned positive for the first time in 7 quarters. For the components in the 4Q22 GDP figure that contracted and resulted in 4Q/22 GDP. 65 lower than expected is government spending. and manufacturing production contracted more strongly than expected. The sharp drop in government spending was a result of the National Health Security Fund’s reduction in spending on coronavirus disease 2019 (COVID-19) cases. and the Social Security Fund while the manufacturing sector shrank more than expected as a result of the global economy slowing down faster than expected. Affecting the production of goods for export.
Overall, from the Thai economic numbers in the 4th quarter of 2022 that are lower than expected. It reflected the global economic slowdown faster than many parties expected. which can be seen from goods exports and industrial production, which are two economic activities that are directly linked to the global economy. But if the export sector, which is another important engine of Thailand, must stumble down due to the global economic slowdown May cause the overall growth of the Thai economy in 2023 to be lower than previously expected. and make agencies and institutions The forecast has to be revised down. As the NESDB has revised down the Thai GDP forecast for 2023 down to a range of 2.7-3.7% (or an average of 3.2%), down from the forecast range of 3.0-4.0% (or an average of 3.5%), which will affect the assumption adjustment. in estimate The majority of analysts’ listed companies followed. Especially during the 2022 earnings report period (Feb) and will be followed by an analyst meeting (Feb-March), which will be the season for adjusting various assumptions. For the year 2023 due to various negative factors during the months of February-March, along with the gradual dividend payment for the year 2022 during the months of March-May. Will be a factor to pressure the Thai stock market to cause a short-term correction.
If we take data from Thai economic figures and trends to consider investment strategies The upcoming short-term retracement as I analyzed above. It may be an opportunity for gradual investment in the stock market. because I assessed that there was an opportunity in the Thai stock market will begin to recover in the middle of this year From various factors such as 1. General elections that will boost spending and business confidence. 2. Assessment will begin to see signs of recovery in exports during Q2/23-Q3/23 as overseas entrepreneurs are expected to have the opportunity to start gradually ordering products to replenish stocks in the warehouse once more. following the opening of the country by the Chinese government 3. The tourism and service sector in Thailand is expected to continue to expand throughout 2023 and 4. Prices of goods and services both domestically and internationally are likely to gradually decline throughout 2023.
However, the risk factor that must be considered for investment in this year 2023 is the global economic situation that is still at risk of an economic slowdown in some countries. And we are already starting to see warning signs from export figures in 4Q22 that the global economic slowdown may come faster than expected as well.