The suggestions were made after the FTI’s Thai Industries Sentiment Index (TISI) for January fell to 86.3 from 87.5 the previous month, marking the first decline in five months.

The latest survey of FTI members found they were concerned about the country’s slow economic growth in the face of further drought, and a slowdown in global economic growth, especially in China, which would negatively affect the Kingdom’s exports this year, FTI chairman Suphant Mongkolsuthree said at a press conference.

The survey was conducted among 1,202 companies from 44 industry groups – 31.3 per cent of them being small firms, 38.4 per cent of them mid-sized, and 30.3 per cent large companies.

Suphant said the TISI in January had dropped because the global economy was showing signs of only slight growth, or possibly even a contraction, this year.

Particular concern was expressed about China’s slowdown, he said.

However, the FTI is maintaining its forecasts for Thai economic expansion this year at between 3 per cent and 3.5 per cent, and its estimate for export growth at 2 per cent, even though the Bank of Thailand and the National Economic and Social Development Broad have lowered their economic-growth forecasts to between 2.8 per cent and 3 per cent.

“We are keeping to our economic-growth forecast of 3 per cent to 3.5 per cent due to confidence over domestic spending, while direct investment from both domestic and foreign sources will continue to expand as the Board of Investment is providing more tax incentives for those who expand their investment this year,” he explained.

However, the government must in parallel accelerate its investment in infrastructure projects as planned, as such investment would also boost domestic spending and drive economic growth this year, he stressed.

Drought

Moreover, the government also has to have a strategy to solve the country’s drought problems by managing the water system to meet the needs of the country’s agriculture sector for the long term, he said.

Turning to the nation’s trade, he said that promoting investment and trade with neighbouring countries was another way to boost exports, especially to CLMV countries (Cambodia, Laos, Myanmar and Vietnam).

CLMV countries have showed strong economic growth and increased demand for products from Thailand, therefore Thai producers and exporters need to focus on maximising this regional opportunity, the FTI chairman said.

Promoting investment in CLMV would also expand the export market for Thai businesses, as they could us those bases to export to Europe and the US, which still offer import-duty incentives to products from CLMV countries, he added.

“We believe that if the government has measures to promote trade and investment with CLMV, speeds up its investment in infrastructure projects, and launches others measures to boost domestic spending – like the tax refund of Bt15,000 in the final five days of December last year – the TISI will recover the next time around,” Suphant said.

Meanwhile, the value of auto exports – complete vehicles, motorcycles and auto parts – in January came in at Bt76.59 billion, up 20.54 per cent from the same period |last year, thanks to higher |prices, Surapong Paisitpatnapong, spokesman of the FTI’s Auto|motive Industry Club, said yesterday.

However, car production fell 11.67 per cent to 147,651 units, |ear on year, with 100,616 of the units destined for the export market.

“We target domestic car sales this year will be between 750,000 and 780,000 units, or a drop of between 2.3 per cent and 6.13 per cent from 799,000 units last year,” Surapong said.

However, the club continues to maintain its export-market target of between 1.22 million and 1.25 million units for the year, which would be 1.3 and 3.8 per cent above shipments of 1.204 million units last year, he adde.