Overall consumer spending during Loy Krathong is likely to remain sluggish this year because people remain concerned about the reoccurrence of Covid-19 outbreaks and relatively poor economic conditions.
The latest survey by the University of the Thai Chamber of Commerce (UTCC) revealed that spending during the annual full-moon celebration, which this year falls on Friday, is expected to shrink by 3% to 9.14 billion baht, the lowest level since 2011. It was also the first contraction in over five years.
“People are more cautious about spending now that most of them are still concerned about their income and a possible return of a Covid-19 outbreak while the economy has just started to see a mild recovery,” said Thanavath Phonvichai, UTCC president.
Mr Thanavath said average spending per person is estimated at 1,280 baht during the festival, down from 1,348 baht per person last year, with spending to go mainly on travelling, dining out and parties.
According to Mr Thanavath, based on the university’s survey, most respondents expect the economy will start recovering healthily in the second half of 2022.
Nonetheless, Mr Thanavath noted that economic growth will depend on the rate of vaccination coverage, additional stimulus measures and tourism income.
The atmosphere at Ong Ang canal in Bangkok’s Phra Nakhon district ahead of this year’s Loy Krathong festival. Arnun Chonmahatrakool
The government should also extend the diesel price subsidy until the first quarter of next year in order to reduce the cost of living for people and curb rising product prices.
“The UTCC expects the economy will grow by 1-1.5% this year and 4-5% next year, but the government is also needed to help enable businesses in provinces to access soft loans while the economy starts recovering,” Mr Thanvath said.
The National Economic and Social Development Council (NESDC) reported on Monday the economy contracted by 0.3% year-on-year in the third quarter of 2021, compared with 7.6% growth in the previous quarter.
The contraction largely stemmed from the ongoing and widespread outbreaks of Covid-19, which adversely impacted economic activities and people’s livelihoods.
After seasonal adjustments, the economy shrank by 1.1% from the second quarter. In the first nine months of 2021, the economy expanded by 1.3%.
The government’s planning unit predicted the economy is expected to grow by 1.2% this year, recovering from a 6.1% contraction in 2020, with next year’s expansion predicted to be between 3.5-4.5%.