Thailand’s lockdown-like virus curbs dent economic recovery

  • Thailand risks fueling its decade-high unemployment rate and household debt with the imposition of lockdown-like measures to contain the deadliest Covid outbreak to hit the nation.
  • The greater Bangkok area, accounting for about 50% of Thailand’s gross domestic product, will shutter shopping malls, spas, massage and beauty clinics for at least two weeks starting 12 Jul 21. A mandatory work-from-home rule for most government employees, overnight curfews and curbs on domestic travel are set to hurt retailers, airlines and restaurant operators, already reeling from some form of Covid restrictions for more than a year.
  • Thailand is tightening restrictions to stem the spread of the more contagious delta variant of Covid that’s also fueled a surge in cases from Indonesia to Vietnam, and scuppered their plans to open up borders. The latest measures may further delay Thai economy’s recovery from its worst slump in more than two decades and derail Prime Minister Prayuth Chan-Ocha’s target to welcome back vaccinated tourists by as early as mid-Oct 21.
  • “The economic hit will be increasingly bigger with each lockdown even if the length of the lockdown is the same,” said Maria Lapiz, managing director of Maybank Kim Eng Securities Thailand. “This is because many companies are already nearing the end of their tether after so many months of ever-shrinking revenues and stubbornly high cost of existence.”
  • On 12 Jul 21, the Bank of Thailand said it may slash its 2021 GDP forecast to factor in the worsening Covid outbreak, and will closely monitor the situation to see whether additional policy measures are required.

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