The Federation of Thai Industries (FTI) plans to invite political party leaders to debate Thailand's economic challenges and their solutions as the country gears up for a new general election.
An FTI economic team is drafting details of Thailand's business challenges, focusing on higher costs in five areas: raw materials, labour, energy, logistics and finance.
Rising expenses could impact the competitiveness of local businesses and the country over the longer term, said FTI chairman Kriengkrai Thiennukul after a meeting of the Joint Standing Committee on Commerce, Industry and Banking (JSCCIB) yesterday.
The FTI wants to invite economic teams of political parties to share their solutions to these issues, with the result of the discussion included in a federation paper on Thailand's business challenges. The group plans to host a forum later where party leaders are invited to share their visions.
The JSCCIB meeting also expressed concern about the baht strengthening against the US dollar. The baht's appreciation will be a key factor affecting exports this year amid a global economic downturn, he said.
"The baht's movement is quite volatile against the dollar. Recently it weakened to 37-38 baht against the dollar before rising to 33 baht now. Business operators want the central bank to manage the baht and make it move steadily," said Mr Kriengkrai.
The committee maintained its 2023 export growth projection of 1-2% and plans to closely monitor the economic environment. Exports expanded the past three months, from 4.4% in October to 6.1% in November and 14.6% in December.
Rising financial costs because of interest rates hiking is another factor pressuring businesses. The Bank of Thailand recently increased its policy rate by 0.25 percentage points to 1.5% and is expected to raise it 2-3 more times to 2% or higher this year.
Amid an uneven economic recovery, rising financial costs will affect small and medium-sized enterprises as well as the household sector, Mr Kriengkrai said.
Krit Jitjang, co-president of Kasikornbank and representative of the Thai Bankers' Association, said businesses should hedge against foreign exchange rates to deal with higher baht volatility, caused by internal and external factors.
Central bank assistant governor Chayawadee Chai-Anant said the baht has been moving in line with the country's economic fundamentals. The firmer baht is a result of a smaller rate hike by the Fed and a recovery in Thai tourism, she said.
