The baht opened at 34.48 to the US dollar on Wednesday, jumping from Tuesday’s close of 34.52.
The currency is expected to move in a range between 34.40 and 34.80 on Wednesday, predicted Krungthai Bank market strategist Poon Panichpibool.
Poon said the market is in a risk-on state and might cause the baht to fluctuate and weaken amid worries that the US Federal Reserve may move to increase the interest rate.
Besides, the effect of Russian energy sanctions might cause the dollar to advance again.
The strengthening of the baht might be limited to 34.40-34.50 to the dollar, the level importers are waiting for to purchase the greenback.
Poon advised businesses to use hedging tools such as options to manage risks in the highly volatile currency market.
He said the currency market is open to more risks due to hopes that China might ease its lockdown measures on June 1.
Moreover, Chairman Jerome Powell has signalled that the Fed might raise the interest rate again by around 0.5 per cent to tackle inflation, according to market expectations.
Thailand and Saudi Arabia agreed on Tuesday to set up a cooperation council to further strengthen bilateral ties.
The two countries also agreed to waive visa requirements for diplomacy and government affairs, while Saudi Arabia will consider helping the 800 Thai nationals whose visa has expired.
Foreign Minister Don Pramudwinai revealed these developments after meeting with his Saudi Arabian counterpart, Prince Faisal bin Farhan Al Saud, in Riyadh on Tuesday.
“Prince Faisal said he will visit Thailand in June to prepare for Crown Prince Mohammad bin Salman’s visit,” Don said.
Prince Faisal bin Farhan Al Saud
Meanwhile, he said, Thailand will appoint its ambassador to Saudi Arabia in the third quarter of this year.
“Saudi Arabia has already started direct flights to Thailand and we believe many Saudis will be travelling to the country,” he said. “Meanwhile, Saudi Arabia is also keen for Thais to visit.”
Don added the aim of this visit was to link up businesses from both countries, so they can make the most of the opportunities available.
“Many businesses were interested in participating in the investment conference hosted by Saudi Arabia’s Investment Ministry,” he said, citing Investment Minister Khalid A Al-Falih’s remark.
Don said he expects this trip to benefit the private sector of both countries, adding that Saudi Arabia needs a lot of Thai workers as it has many investment projects in the pipeline.
“We know that at least 500,000 positions in construction and other related services are available, of which about 200,000 will be allocated to Thais,” he said.
“However, it depends on whether we have enough workers to meet the demand.”
Apart from this, he said, the two countries aim to strengthen their ties in all aspects.
Don led hundreds of representatives from Thailand’s energy, tourism and export sectors on a five-day trip to Saudi Arabia. The May 15-19 trip aims to restore cooperation and investment after nearly a three-decades-long freeze in Thai-Saudi relations.
Riyadh cut trade and diplomatic ties with Bangkok after the so-called Blue Diamond affair, in which the theft of jewels by a Thai worker from a Saudi palace in 1989 was followed by a series of killings of Saudi representatives in Thailand.
Though first-quarter GDP growth beat expectations, Thailand’s economy faces uncertainty and needs more government support amid spiralling public debt, the National Economic and Social Development Council (NESDC) warned on Tuesday.
The warning came as the NESDC unveiled first-quarter growth of 2.2 per cent year on year, while offering its overall outlook for 2022.
GDP growth beat the forecasted 2.1 per cent after easing Covid restrictions sparked a tourism revival and a surge in exports.
Domestic consumption also accelerated as economic activities began to return to normal.
However, the ongoing Russia-Ukraine war saw the consumer confidence index drop from 38.9 last quarter to 37.3 as inflation took a toll on Thailand.
NESDC secretary-general Danucha Pichayanan pinpointed several challenges to Thai economic recovery and growth this year.
Apart from outside factors like the Ukraine war, China slowdown, Covid-19 uncertainty and supply chain disruption, Thailand’s rising private and household debt are key factors of concern, he said.
The NESDC report said high levels of private debt will hinder recovery while the ability to repay debt would be pressured by rising interest rates along with incomplete recovery in the labour market. Household debt, meanwhile, will place limits on how much people can consume.
“We need to accelerate the support scheme for the private sector and debt restructuring measures issued by the Bank of Thailand while considering more measures to extend the debt repayment period for households so they have liquidity,” Danucha said.
He said the current situation lacked precedents, so was not easy to improve. To weather the crisis, the NESDC has asked for firm cooperation from all parties. He also urged more government aid for citizens, adding that support schemes should be targeted at the neediest people as national budgets and resources are now limited.
Meanwhile, the public could greatly support the country by spending more on essential goods and services. He also pleaded for Thais to consider domestic travel rather than going abroad.
On the outlook for this year, the NESDC forecasts the economy will expand in the range of 2.5-3.5 per cent – lower than the previous forecast of 3.5-4.5 per cent.
Expansion would be driven by domestic demand, domestic tourism recovery, and exports growth. However, high inflation, slowdown in China, and uncertainty over the Russia-Ukraine war would create growth fragile growth.
Exports would remain Thailand’s main economic engine this year, with 7.3 per cent growth forecast. Meanwhile, private consumption and private investment are expected to increase by 3.9 per cent and 3.5 per cent respectively. Public investment is projected to rise by 3.4 per cent.
Headline inflation is estimated in the range of 4.2-5.2 per cent and the current account is projected to record a deficit of 1.5 per cent of GDP.
The Cabinet on Tuesday approved a deeper cut in excise tax on diesel from THB3 to THB5 per litre for two more months, the government spokesman said.
The Cabinet deliberated on the diesel excise cut proposal at its weekly Cabinet meeting, as the current THB3 cut is due to expire on May 20.
Government Spokesman Thanakorn Wangboonkongchana said the Finance Ministry had proposed two options to the Cabinet.
The first option urged the Cabinet to extend the THB3 per litre cut for three more months.
The second option urged the Cabinet to increase the cut to THB5 per litre, but for just two more months.
The Finance Ministry has projected that the subsidy would cost the government not more than THB20 billion in projected revenue. If the government loses more than THB20 billion in excise revenue, it could affect its revenue target, the ministry explained to the Cabinet.
The government is using excise cut to try to stabilise the retail price of diesel, so that people would not be affected by the rising cost of transportation, which could inflate manufacturing costs.
An academic, Praipol Kumsup, welcomed the extension of the excise cut, saying it would mitigate the impact of rising energy prices on the people.
The National Economic and Social Development Council (NESDC) on Tuesday lowered its forecast for Thailand’s economic expansion in 2022 to 2.5 to 3.5 per cent from the previous estimate of 3.5 to 4.5 per cent it had made in November 2021.
NESDC secretary-general Danucha Pichayanan said that in the first quarter of 2022, Thailand saw a 2.2 per cent expansion of gross domestic product (GDP), with almost all sectors reporting increased turnover.
The key economic indicators in the first three months of the year are:
Private consumption expanded 3.9 per cent
Overall investment expanded 0.8 per cent, with private investment increasing 2.9 per cent, but government investment contracted 4.7 per cent
Government consumption expanded 4.6 per cent
Exports expanded 10.2 per cent, with export volume increasing 30.7 per cent year on year
Agricultural sector expanded 4.1 per cent
Industrial sector expanded 1.9 per cent
Construction sector contracted 5.5 per cent
Danucha said that factors that prompted the NESDC to lower GDP estimates for 2022 were the slowdown in expansion of global trade and the rising price of crude oil.
“The conflict between Russia and Ukraine will continue to affect global and Thailand’s economic expansion, especially from the inevitable supply chain impact on energy, fertilisers and wheat that are key factors for the manufacturing sector,” he added.
In November last year, the NESDC had forecast GDP growth of up to 4.5 per cent, riding on increasing domestic demand and manufacturing capacity following the improving Covid-19 situation and increasing vaccination rate, gradual recovery of international tourism following the government’s relaxation of Covid measures, expansion of exports, and disbursement of government budget to various projects.
The baht opened at 34.70 to the US dollar on Tuesday following the four-day break, strengthening from Thursday’s close of 34.78.
The currency is expected to move in a range between 34.40 and 34.90 on Tuesday, said Krungthai Bank market strategist Poon Panichpibool.
Poon said the baht could fluctuate, weaken and test the key resistance level of 34.90 if the market remains in a risk-off state.
However, the baht might strengthen if Thailand’s first-quarter GDP is better than forecast, as investors expect the Bank of Thailand to signal monetary tightening in June.
Meanwhile, Poon said the US dollar will be supported by the demand for safe assets if the market remains in a risk-off state. The market might wait for the next US Federal Reserve statement. If the Fed does not signal a heavy interest rate increase, the market may gradually open to risks, he added.
Poon said that volatility was still high in the currency market due to the Ukraine-Russia conflict, China’s Covid-19 situation, and concern about the Fed’s monetary direction.
Poon advised businesses to use hedging tools such as options to manage risks in the highly volatile currency market.
Wind Energy Holding (WEH) is preparing to pay 2.7 billion baht in dividends to its shareholders after the Bangkok South Civil Court dismissed an injunction requested by KPN Group co-founder Kasem Narongdej.
Kasem requested the injunction in August 2020 to prevent WEH from paying dividends on 64 million of the total 108 million WEH shares, claiming that the shares belonged to him.
On May 11, the Bangkok South Civil Court dismissed Kasem’s request, ruling that he did not own the shares.
As a result, WEH will pay 2.7 billion baht in dividends to shareholders, including Golden Music and WEH chairman Pradej Kitti-Itsaranon.
“The company is allocating cash and expects to pay the dividends this week,” a source from WEH said.
WEH has made six dividend payments in the past two years, worth 41.9 baht per share.
Operations of the firm were halted in 2014 when its co-founder Nopporn Suppipat fled to France after being threatened with criminal prosecution for allegedly intimidating a former business partner to reduce his debts.
Former WEH chairman Nop Narongdej, who is also Kasem’s son, completed eight wind power projects with electricity production capacity of 717 megawatts in 2019.
However, he was voted out of his position by the current board of executives.
WEH is the largest wind power generation company in Southeast Asia, generating more than 10 billion baht revenue per year.
The Saudi Arabian Public Investment Fund (PIF) has pledged to use Thailand as a hub for investment in Southeast Asia, the PIF chief said.
The fund’s chief, Yasir bin Othman al-Rumayyan, met Prime Minister Prayut Chan-o-cha at the Royal Thai Air Force Airport in Don Mueang on Sunday morning.
Government spokesman Thanakorn Wangboonkongchana quoted Prayut as telling the PIF chief that relaxed travel restrictions in Thailand will help boost cooperation between the two kingdoms. He also told the fund chief that Thailand was ready to further develop bilateral ties, which are already improving.
Thanakorn quoted the PIF chief as saying that he was meeting Prayut under the instructions of Crown Prince Mohammad bin Salman bin Abdulaziz Al Saud, who is also deputy PM and defence minister of Saudi Arabia.
Yasir said he had been instructed to discuss cooperation between the two countries, especially on trade and investment in energy businesses such as petroleum and gas surveys.
The two sides also discussed e-sports and soft power cooperation, the spokesman said.
The Saudi fund chief also told Prayut that Saudi Arabia hopes to hold bilateral talks with Thailand to build opportunities for trade and investment. He added that Saudi Arabia will also use Thailand as an investment hub for the region.
Thai-Saudi relations had been stalled since 1989 over a scandal dubbed the Blue Diamond Affair, which involved stolen jewels and a string of murders.
The first Tianjin Air Cargo flight carrying Thai durians landed at Nanning Airport in Guangxi, China on Friday, opening a new shipment route for Thailand’s No 1 fruit export.
“This is good news for durian farmers, said Agriculture Ministry adviser Alongkorn Ponlaboot.
“The new cargo flight operation will help stimulate air freight between Guangxi and Thailand, especially of durians, which are popular in China,” he said.
Tianjin Air Cargo operates in China’s Beijing, Tianjin and Hebei regions but has expanded to cover the route between Nanning and Bangkok. China opened Nanning Airport as a gateway for Thai fruit exports on April 1 after trade negotiations between Bangkok and Beijing.
Thailand has also increased sea shipments of fruit to 55 per cent in a bid to reduce congestion at land checkpoints during the durian harvest, Alongkorn said.
The remaining 40 per cent of Thai fruit would be exported by land and 5 per cent by air, he added.
“Last year, Thailand exported 52 per cent of fruit by sea, 48 per cent by land and less than 1 per cent by air,” he noted.
The new gateway at Nanning Airport would boost exports by air, he added.
Friday saw a ceremony welcoming the first shipment of durians at Nanning Airport, aiming to promote opportunities for Chinese importers.
The airport also has quality-checking facilities for live and frozen aquatic food, which will further boost trade between Asean and China.
Bangkok, May 13 – SHR reveals strong business recovery with the total revenue in the first quarter of 2022 (Q1/2022) at Bt. 1.69 billion. The growth momentum is expected to continue to improve quarter-on-quarter towards 2022 on the back of the relaxation of travel policy across the world, brought up the estimated 2022 revenue to hit Bt. 8.50 billion or doubling the YoY growth.
SHotels and Resorts PCL (SHR), the flagship hospitality arm of Singha Estate PCL, announced its financial results, showing revenue from sales and services during Q1/2022 at Bt. 1,690 million, tripled the revenue over the same period last year. Adjusted EBITDA in the said quarter stood at Bt. 261 million which was the third consecutive quarter of positive adjusted EBITDA, reflecting the performance recovery of the Company.
In Q1/2022, the revenue from the UK and Maldives hotels portfolio made up to 78% of total revenue. The lift in Covid-19 restrictions, the borders reopening to international travelers together with the rise in travel demand in Thailand, Fiji, and Mauritius brought up the revenue from Thailand and Outrigger hotels in Q1/2022. This reflects a positive signal for future revenue growth when tourism sector recovers to surpass pre-pandemic level and the international flights resumes to its normal schedule.
The reopening borders policy and the government’s economic stimulus measures in several countries have allowed the travel demand to recover, starting from the second quarter this year onwards. The Company foresee the positive trend which reflected by the operation performance in April 2022, showing an increase in average occupancy of the overall portfolio of 60%. The growth performance is projected to keep its momentum towards 2022 in accordance with the entering into high travel season of each county. Given the aforesaid positive factors, the well-diversified hospitality portfolios, upgraded services and offerings to reach high tourist demands, and enhanced direct booking channels are the elements driving the Company performance to achieve its target of Bt. 8,500 million, pushing SHR to become the No. 2 highest revenue Thai hotel operator.
Mr. Dirk De Cuyper, Chief Executive Officer of S Hotels and Resorts PCL, revealed that “We foresee the increasing demands in the hospitality business, including our properties in the five top leisure destinations, particularly in the UK and Maldives. Moreover, SHR’s strategy in driving the business using digital marketing to create customized platforms for the wider implementation of direct booking has given the company more resilience and adaptability. The property renovation and the creation of value-added features in all identified potential properties to cater to guests’ various preferences and lifestyle needs is another key factor that will drive 2022 revenue.”
Performance of CROSSROADS Phase 1 Hotels in Maldives for Q1/2022 continued to recover, accomplished the occupancy rate of 74%, well above the industry average. This was mainly from its outstanding design and composition of the project which are different from other typical resorts in Maldives. CROSSROADS project is the first and only fully integrated leisure lifestyle destination in Maldives that serves variety types of guests. Thanks to the fast recovery in tourism, its unique selling points, and the proactive marketing strategy to attract customers from several regions across the globe, CROSSROADS Phase 1 Hotels are predicted to maintain favorable occupancy rate throughout the year 2022 and able to enhance ADR by the Company’s strategies on product upgrades and high spending customer concentration, for example tourists from Europe, America, and Middle East. Regardless, SHR is confident that once the tourists from Asian countries such as China, Korea and Japan, which used to be one of the key source markets in Maldives, have their borders fully reopen, the performance of CROSSROADS Phase 1 Hotels will grow even stronger and become a dream destination of travelers from all over the world.
The resumption of travel demand in UK and a solid performance are expected to continue starting from April to year end, in accordance with the high travel season. SHR projects the performance to return to the pre-pandemic level of 2019 as the hotels in UK portfolio are regional hotels, located in key leisure and economic destinations which gain more popularity from pent-up domestic travel demand. In addition, SHR intended to enhance the efficiency and return of UK hotels portfolio with the plan to further invest in the potential hotels to increase ADR and improve the profitability from Q3/2022 onwards.
Moreover, with the optimistic view on the recovery of MICE (Meetings, Incentive Travel, Conventions, Exhibitions) business in the UK, Maldives, and Thailand, especially SAii Laguna Phuket, this is another upside to boost up the 2022 performance.
“Amidst the most challenging environment. SHR will continue the long-term growth to continuously improve efficiency and returns of our hotel portfolio. A total budget of Bt. 2,800 million has been set aside for a three-year-plan to enhance its asset rotation strategy for existing properties and the construction of SO/Maldives, which is targeted to launch in 2023. The other earmarked budget is set for the merger and acquisition plan for new properties. We also aim to focus on being a hotel operator, either through a flagship homegrown brand or partnership with leading international brands for business expansion to gear up for accelerated growth and enhance competitiveness.” added Mr. Dirk De Cuyper.
Prince Faisal bin Farhan Al Saud
The two sides also discussed e-sports and soft power cooperation, the spokesman said.
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