Positive BoT on the provinces
Central bank unveils regional data tracker
Regional and provincial economic activities have intensified after the country’s reopening and positive momentum is expected to continue through the rest of the year, a Bank of Thailand (BoT) executive said.
After the government announced the reopening of the country from November 1, the economy as a whole – including regional and provincial economic activities – improved across the board, especially consumer spending, transportation local and domestic tourism, said the BoT’s senior director for the department’s economic policy structure, Chitkasem Pornprapunt.
Mr Chitkasem said the BoT expects the resumption of economic activities to continue in November and December of this year.
The central bank yesterday launched what it calls the BoT Regional Activity Tracker (BOT RAT), which will allow it to better track economic situations, trends and the living conditions of people in all regions.
The information obtained through the tool will help regional economic operators, who need up-to-date economic data, to develop better trade orientation plans.
The BOT RAT covers regional economic indices in five areas: the overall regional economy, tourism, employment, transport and drought.
The information obtained from BOT RAT will be published monthly, starting November 15th.
In addition, the BoT’s research on regional businesses in Thailand during the period 2007-2017 found that regional businesses in the North, Northeast and South were weaker.
Regional companies have generally experienced lower profitability, reflected by their lower return on assets (ROA) and their higher debt ratio (D / E).
Research found that over 50% of regional businesses had a higher D / E ratio and were in a lower financial position.
The provinces showing greater financial fragility were Nakhon Ratchasima, Phuket, Suratthani, Nakhon Si Thammarat, Songkhla and Lampang.
Low-profit businesses were found in wholesale and retail trade, real estate, construction, hotels and restaurants, and agricultural processors.
Companies with a high D / E ratio a decade ago were in the wholesale, retail, and hotel and restaurant industries, particularly in the South.
The increase in the D / E ratio of companies in the South was largely the result of their higher investments in response to higher demand from foreign tourists.
In 2017, the net profit of all companies in Bangkok and Greater Bangkok was 27% of the total profit of all companies in the regions studied, followed by 16% of those in the North, Northeast and South combined.
In 2017, the ratio of foreign direct investment (FDI) in the North, Northeast and South combined represented only 3% of total FDI at the national level.
In contrast, FDI in Bangkok and Greater Bangkok and Central Thailand was 97%.